Category: EastWest Bank

EastWest Bank to enter in life insurance business via a joint venture with Ageas

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EastWest Banking Corporation (“EW Bank”) signed a joint venture agreement with Ageas Insurance International NV (“Ageas”) to establish a new life insurance company to be called “EastWest Ageas Life”.

The JV will be a start-up company in which EW Bank and Ageas will both have an equal shareholding of 50%. It was further agreed that EW Bank and EastWest Ageas Life will enter into a 20-year exclusive distribution agreement.

The ambition is to build the premier Bancassurance business in the Philippines offering tailor-made insurance solutions to the customers of EW Bank supported by high quality service and state-of-art technology. The insurance business will benefit from EW Bank’s fast growing customer base. With more than 400 branch stores, the bank has the 7th largest distribution network amongst banks in the Philippines. Ageas will contribute its proven Bancassurance skills and best practices from its successful businesses in Asia and Europe.

Tony C. Moncupa Jr., President and CEO of EW Bank said “We have always viewed Bancassurance as an integral part of our business model. We see it as a necessary ingredient to have complete product offerings for the financial services needs of our target market segments. Specifically, the consumer and middle market corporate segments. We are pleased to partner with Ageas, one of the major insurance providers in the world. In Ageas, we are comfortable that we have a common set of objectives and aligned philosophy on how to conduct business and best serve our customers. For us in EW, alignment is most important. This is why we have always preferred a JV arrangement. We are confident that this partnership will be mutually beneficial to EW and Ageas. We are very excited in this new venture and we look forward creating value for all our stakeholders.

“As part of our Asia strategy, we have made no secret that we wish to enter the Philippines as the insurance market is highly attractive with a population of around 100 million people, a fast growing middle class and low insurance penetration. The potential is huge given that the current Life insurance penetration rate of around 1.5% is one of the lowest in Asia. We are very pleased to be a partner to EW Bank which has a strong management and clear ambition to grow. We are convinced that together we can deliver another successful partnership in Asia,” commented Gary Crist CEO of Ageas Asia.

The JV will have an initial capitalization of PHP2.01 billion, which is double the minimum regulatory capital required for a new insurance company in the Philippines. Future funding will be dependent on the performance of the business.

Subject to regulatory approvals, the transaction is expected to be completed in the second half of the year. Ageas and EW are looking forward to EastWest Ageas Life writing its first insurance policy before the end of the year.

 

 

EastWest Bank to enter in life insurance business via a joint venture with Ageas

PRNEWS Admin Leave a comment

EastWest Banking Corporation (“EW Bank”) signed a joint venture agreement with Ageas Insurance International NV (“Ageas”) to establish a new life insurance company to be called “EastWest Ageas Life”.

The JV will be a start-up company in which EW Bank and Ageas will both have an equal shareholding of 50%. It was further agreed that EW Bank and EastWest Ageas Life will enter into a 20-year exclusive distribution agreement.

The ambition is to build the premier Bancassurance business in the Philippines offering tailor-made insurance solutions to the customers of EW Bank supported by high quality service and state-of-art technology. The insurance business will benefit from EW Bank’s fast growing customer base. With more than 400 branch stores, the bank has the 7th largest distribution network amongst banks in the Philippines. Ageas will contribute its proven Bancassurance skills and best practices from its successful businesses in Asia and Europe.

Tony C. Moncupa Jr., President and CEO of EW Bank said “We have always viewed Bancassurance as an integral part of our business model. We see it as a necessary ingredient to have complete product offerings for the financial services needs of our target market segments. Specifically, the consumer and middle market corporate segments. We are pleased to partner with Ageas, one of the major insurance providers in the world. In Ageas, we are comfortable that we have a common set of objectives and aligned philosophy on how to conduct business and best serve our customers. For us in EW, alignment is most important. This is why we have always preferred a JV arrangement. We are confident that this partnership will be mutually beneficial to EW and Ageas. We are very excited in this new venture and we look forward creating value for all our stakeholders.

“As part of our Asia strategy, we have made no secret that we wish to enter the Philippines as the insurance market is highly attractive with a population of around 100 million people, a fast growing middle class and low insurance penetration. The potential is huge given that the current Life insurance penetration rate of around 1.5% is one of the lowest in Asia. We are very pleased to be a partner to EW Bank which has a strong management and clear ambition to grow. We are convinced that together we can deliver another successful partnership in Asia,” commented Gary Crist CEO of Ageas Asia.

The JV will have an initial capitalization of PHP2.01 billion, which is double the minimum regulatory capital required for a new insurance company in the Philippines. Future funding will be dependent on the performance of the business.

Subject to regulatory approvals, the transaction is expected to be completed in the second half of the year. Ageas and EW are looking forward to EastWest Ageas Life writing its first insurance policy before the end of the year.

 

 

Manny Pacquiao signs endorsement deal with EastWest Bank

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In the midst of preparing for his long-awaited fight with Floyd Mayweather, Manny Pacquiao signed a new endorsement deal with EastWest Bank, a subsidiary of Gotianun-led Filinvest Development Corporation and one of the country’s fastest-growing banks.

Pacquiao said of his new endorsement, “I am proud to represent EastWest, a young bank that dreams big and works really hard to reach its goals, just like me.”

Like Pacquiao, EastWest Bank’s climb to success has been more than phenomenal. The universal bank started humbly with just a small network of branches, but aggressively expanded and grew to 405 branches.

EastWest CEO Antonio C. Moncupa Jr. said that the bank could not have chosen a better brand endorser than the world-renowned boxing champ.

“Pacquiao is a hero who embodies the excellent qualities of the Filipino spirit. Starting as an underdog, he has fought with bigger opponents and emerged as one of the greatest boxing champions the world has ever had.

“He has always been focused, disciplined and determined to win; and one who humbly dedicates his victory to God and country,” Moncupa said during the bank’s contract signing with the premier athlete.

By offering excellent products and services and investing in technology and training, EastWest has demonstrated as well the bank’s drive to excel. Like Pacquiao, EastWest’s spot-on strategies will allow the bank to leverage its momentum to be, pound-for-pound, one of the country’s best banks.

Eastwest Core Businesses Register Double Digit Growth

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EastWest Bank reported a Net Income of P1.6 Billion for the first nine months of 2014, with steady quarterly growth but lower by 5% from the same period last year due mainly to lower trading gains. Recurring income on the other hand continues to improve at the back of solid growth in core banking businesses.

EastWest Bank reported robust growth in its core income as Net Interest Income and Fees increased by 20% and 29%, respectively on the back of healthy growth in Loans and Deposits.

Total Assets stood at Php167 billion as of September 30, 2014, or 31% higher from the same period last year. The growth in assets largely came from customer loans, which grew by 28% year-on-year, with both consumer and corporate loans growing by double-digit at 29% and 26%, respectively.

EastWest continues to be the most consumer-focused universal bank with its consumer portfolio at 54% of total loans. As a result, it continued to register the highest Net Interest Margin at 8.1%, which is more than double the industry average.

Deposit levels stood at Php128 billion, up by 34% from third quarter 2013. The year-on-year growth is largely attributable to the expanded branch store network. EastWest currently has a total of 393 consolidated branches and expects to close the year with at least 400, combined with its subsidiary EastWest Rural Bank.

Net Interest Income for the first nine months stood at Php7.3 billion or 20% higher than the Php6.1 billion posted in the same period last year as interest income increased by 17%, while interest expense declined by 2% largely due to the loan growth and lower cost of deposits.

Total Operating Expenses, including provision for loan losses, increased by 7% to Php8.8 billion. The Bank reported that its costs still have to improve as its branch stores become more productive. The bank opened 178 branches in 2012 and 2013 which has driven costs higher this year.

“As expected, our costs will be most bloated this year due to the branch store expansion. We just have to bear this short term pain as we prepare EastWest to face up to the ever challenging competitive environment. We should see significant improvements starting next year.”

“We expected our first nine months profit to be lower year-on-year because of last year’s one-off income from trading. That is fine as we continue to focus on recurring income from loans and deposits as well as fee-based revenues”, said EastWest Senior Executive Vice President and Chief Operating Officer Jose Emmanuel U. Hilado.

The bank’s annualized return on equity and return on assets were at 10.9% and of 1.4%, respectively. Its Capital Adequacy Ratio (CAR) and Tier 1 were 14.8% and 10.4%, respectively.

Eastwest to Further Grow Auto Loans

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EastWest Bank has a unique business model of having the biggest proportion of its total loan portfolio in the high-margin consumer segment. It reported that for the first half of 2014 its auto loans already grew by 38 percent over Dec 2013.

Industry data affirm the growing market for auto loans. The Chamber of Automotive Manufacturers Association of the Philippines, Inc. (CAMPI) forecasts vehicle sales at 250,000 units this year, up by 24 percent from 2013, because of positive economic fundamentals and improved purchasing power of Filipinos.

The bank will continue to grow its auto loans by harnessing its omni-acquisition channels. In particular, EastWest is targeting to increase its auto loan business in the provinces through its close to 400 stores that serve as one-stop-shops where customers can avail of a complete line of deposit, loan and investment products.

Aside from taking advantage of its stores, EastWest is also fortifying its relationship with its automotive dealer partners to grow its auto loan business. The bank held an Appreciation Night last October 24 at Quest Hotel in Cebu where it recognized its top dealer partners. Exciting gadgets and overnight hotel stay were raffled off to guests. Topnotch singer Kuh Ledesma serenaded the guests with a compelling repertoire of songs.

The event was graced by EastWest’s senior executives led by EastWest President and CEO Antonio C. Moncupa, Jr. and EVP and Head of Consumer lending Cluster Jacqueline S. Fernandez together with the top officers of the bank’s 66 dealer partners.

In her welcome speech, Fernandez said, “The bank is now ranked number 4 in the auto financing industry. We have grown at an average of 45 percent in the last 4 years. To date, our auto loans business here in Cebu comprises 11 percent of our total auto loans portfolio. We are thankful to our dealer partners for their support to our business.”

“Our objective is to help more customers in fulfilling their dreams of owning a vehicle. As a result, our auto loans business has grown steadily over the last years,” added Fernandez.

Cebu is considered a center of trade and commerce, health, tourism and education in the Visayas. EastWest currently has 18 stores in key areas around Cebu to adequately serve the financial needs of residents and businesses in the province. Last June, the bank posted another milestone when it simultaneously inaugurated these stores.

EastWest is owned by the Gotianun family who hails from Cebu. Its sister company Filinvest Land, currently has 6 residential and leisure developments in the province, a testament to the strong commitment of the Gotianun family to Cebu.