EastWest gets green light to go into financial leasing

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) has given East West Banking Corp. the green light to venture into the financial leasing business.

In a disclosure to the Philippine Stock Exchange (PSE), EastWest said the BSP has approved its proposed P100 million initial equity investment in a wholly owned financial leasing company subject to regulatory conditions set by the bank regulator.

EastWest said it has a pending application with the Securities and Exchange Commission (SEC) for the registration of the proposed financial leasing company.

“We shall inform the Exchange as soon as we receive approval of the registration of the financial leasing company by the SEC,” the bank said in the disclosure.

As early as 2014, the bank owned by the family of the late Andrew Gotianun announced plans to venture into the finance leasing business to complement EastWest’s core lending activities.

The bank’s profits jumped 31 percent to P789.6 million in the first quarter of the year from P600 million in the same quarter last year on the back of sustained double-digit growth in its core businesses.

Net interest income surged 32 percent year-on-year to P3.6 billion, driven by robust growth across the different business units: consumer, business loans and deposits.

Other income climbed four percent to P1.5 billion as trading income jumped 52 percent to P449.7 million in the first quarter of the year. The bank’s net revenues jumped 22 percent to P5.1 billion compared to P4.1 billion in the same period last year.

Customer loans increased 33 percent to P164.6 billion as the bank remains focused on growing its consumer and mid-market corporate loans while deposits jumped 29 percent to P189 billion year-on-year, underpinned by a hefty 32 percent increase in low-cost deposits and 26 percent rise in high-cost deposits.

Total assets went up 30 percent to P240 billion from P184.7 billion, bolstered by robust loans and deposits growth as the bank’s customer base and market share grew alongside the expansion of its store network nationwide.

The Gotianun-led bank has 437 stores to date, almost triple its nationwide network five years ago.