RCBC takes over First Malayan Leasing

MANILA, Philippines—The Yuchengco-led Rizal Commercial Banking Corp. is taking a 100-percent stake in the affiliate leasing company First Malayan Leasing & Finance Corp. and infusing P163.2 million in fresh capital into the latter.

In a disclosure to the Philippine Stock Exchange on Monday, the RCBC said the Monetary Board of the Bangko Sentral ng Pilipinas had given it the authority to make this acquisition and capital infusion.

RCBC is taking over control of First Malayan Leasing from House of Investments (HI), which is likewise part of the Yuchengco group of companies.

“We’d like to get into the leasing business. We believe that our leasing products are complementary to the needs of our SME [small and medium enterprise] clients and we want them to have these leasing products in their portfolio,” said John Deveras, chief of strategic initiatives at RCBC.

Folding the leasing firm into RCBC is likewise seen to lower the funding cost of First Malayan Leasing.

“RCBC has more capital to inject and can do cross-selling more actively and help it raise capital from the market directly. It will be easier and cheaper as the market will value parent strength better. Its funding costs will decline given the parent’s ‘halo’ effect,” a banker said.

First Malayan Leasing is a pioneer in the leasing and financing industry in the Philippines as the company started its operations in 1957. It is a non-bank financial institution with a quasi-banking license granted by the BSP. It serves the requirements of corporate, commercial and consumer markets through its innovative loans, leases and investment products.

After ceding control of the leasing company to RCBC, HI, as indicated in its company profile at the PSE, still has subsidiaries such as EEI Corp., iPeople Inc., Honda Cars Kalookan and Landev Corp.