Security Bank seeks MUFG’s 25% Home Credit stake

Security Bank Corp. will acquire the 25 percent stake of MUFG Bank Ltd. in Home Credit Philippines, a financing company for consumer products which boasts of over 11 million customers.

In a report to the Philippine Stock Exchange on Friday, Security Bank said it is working to purchase the shares in Home Credit Philippines from MUFG for P11 billion.

Security Bank eyes to complete regulatory approvals for the shares acquisition by the first quarter of next year.

Krungsri or Bank of Ayudhya PCL and its business units will continue to hold a 75 percent ownership in Home Credit Philippines and remain the majority shareholder.

“This is a tremendous opportunity to leverage synergies, offer innovative lending solutions, and support financial inclusion. We look forward to driving growth and delivering value to our stakeholders together,” Security Bank president and chief executive officer Sanjiv Vohra said.

Strong financial backing

Home Credit Philippines, also called HC Consumer Finance Philippines Inc. (HCPH), offers point-of-sale loans, cash loans, revolving credit and ancillary products such as insurance and warranty services.

Home Credit Philippines has expanded to 15,000 POS locations through its broad partnerships with numerous retailers in the country.

“Security Bank’s on-the-ground presence and understanding of the local market will bring forth continued growth for Home Credit Philippines,” Mitsubishi UFJ Financial Group. Inc (MUFG) head of Global Commercial Banking Business Group Yasushi Itagaki said.

Japan’s MUFG Bank Ltd. has been a partner of Security Bank since 2016, collaborating on easing access to auto and home loans and ways to address climate change.

Security Bank grew its profit in the first nine months by 12 percent to P8.5 billion as growth in consumer and business loans accelerated by double-digit.

Total revenues grew to P40 billion as of September, as net interest income jumped by 31 percent to P32.4 billion.

Net loans surged by 24 percent, reflecting a combined growth of 38 percent in retail and in micro, small and medium enterprises.

On the consumer side, the bank said growth in home loans reached 21 percent, 70 percent in credit cards, and 51 percent in auto loans.