East West Bank acquired AIG-Philam Savings Bank
Posted on March 9th, 2009
East West Bank will become the sixth largest credit card issuer in the country when it finally completes its merging with AIG-Philam Savings Bank. Obviously East West Bank will be the surviving entity.
Nestor A. Espenilla, Jr., the Deputy Governor of Bangko Sentral ng Pilipinas (BSP) has approved the acquisition of the equity of Philam Savings East West Bank, adding that the merger will be a subsequent step which is still subject for approval.
East West Bank president Antonio C. Moncupa Jr. said that the approval paved the way for the integration of the two institutions and added that the merger should be completed within the next three to four months.
AIG-Philam Savings Bank is a subsidiary of Philippine-American Life and General Insurance Co. (Philamlife), the local subsidiary of the US-based American International Group (AIG).
Last month, East West Bank bought Philam Savings and the bank’s two subsidiaries, Philam Auto Finance and Leasing, Inc. and PFL Holdings, Inc., three more local units of AIG which were put up for sale to repay AIG’s lifeline from the US Federal Reserve.
Philamlife is the country’s largest insurer, incidentally, is also on sale. They owned 45% of Philam Savings, while AIG Consumer Finance Group had 45% equity.
With the acquisition of AIG-Philam Savings Bank, Moncupa is expecting East West Bank to expand its retail banking business and is looking forward to get a larger share of the credit card and auto loan market.
“The acquisition will expand our retail footprint, give us better economies of scale and strengthen our service delivery capabilities to the broad middle market segments that include business enterprises and companies,†Moncupa said.
With the merger, East West Bank’s assets will increase to P63 billion from P49.924 billion as of 2008, while its current credit card receivables of at least P3.7 billion is expected to expand.
Currently, East West bank is ranked 19th among commercial banks in the Philippines in terms of assets, capital and deposits.
