Thailand’s Bank of Ayudhya, or Krungsri, acquired a 50-percent stake in SB Finance Co. Inc., the consumer finance unit of Security Bank Corp.
Security Bank said in a statement Tuesday the strategic partnership obtained all the necessary regulatory approvals in the Philippines and Thailand.
The partnership will make a customer-centric digital lending experience available to all Filipinos and small business owners and will strengthen the relationship between the two institutions which have MUFG Bank, Ltd. as a common shareholder.
Security Bank president and chief executive Sanjiv Vohra said the closing of the transaction came at a very opportune time.
“This strategic partnership with Bank of Ayudhya will help rebuild consumer confidence and enhance financial inclusion at this time of the COVID-19 pandemic. We are confident that by leveraging on Krungsri’s strength in the ASEAN retail finance market and in consumer risk management, we can contribute meaningfully to the economic recovery of the Philippines,” Vohra said.
MUFG Bank in 2016 bought a 20-percent stake in Security Bank that allowed the local bank to access MUFG’s global expertise and grow its business beyond local borders.
SB Finance is expected to grow its loan portfolio and loan products suite as the collaboration builds on the strengths of Security Bank in the country’s unsecured personal loan segment. The partnership is set to offer various loan products that cater to personal and small business needs of the Filipino market, while building on Krungsri’s expertise as the number one consumer finance provider in Thailand.
Krungsri and Security Bank appointed ING Bank N.V. as the financial advisor on the transaction.
Security Bank is the seventh largest private domestic universal bank in the Philippines with total assets of P740.4 billion as of June 30, 2020.
Security Bank’s net income jumped 14 in the first half to P5.7 billion from a year ago, on sustained growth in net interest income and trading gains coupled with proactive provisioning.