THAILAND’S Bank of Ayudhya (Krungsri) will buy a 50% stake in Security Bank Corp.’s consumer finance unit in a bid to boost its loan portfolio and expand retail offerings, the Philippine lender said in a statement on Friday.
Security Bank said Krungsri or its units will have a 50% stake in Security Bank Finance. The deal will take effect once the transactions are closed and after regulatory approvals. ING Bank N.V. served as the financial advisor on this transaction.
Security Bank shares rose by P1.5 to close at P193.50 each.
“By localizing the strategies that propelled Krungsri to become Thailand’s market leader in consumer finance, SBF is well positioned to scale the business faster, launch better and more innovative product variants, serve more customers and, in effect, substantially grow its market share in retail business,” Security Bank President and Chief Executive Officer Sanjiv Vohra said in the statement.
The integration will also allow Security Bank Finance to adopt new risk management models and make operations more efficient.
The two banks said they planned to explore opportunities in personal and motorcycle loans and insurance.
Krungsri is the fifth largest financial group in Thailand in terms of assets, loans and deposits.
Security Bank, which posted total assets of P763 billion as of March 31, is among the six largest private local universal banks in the Philippines. — Beatrice M. Laforga