The Securities and Exchange Commission (SEC) has approved on October 6 the registration and incorporation of East West Leasing & Finance Corporation (EastWest Leasing), a wholly-owned subsidiary of East West Banking Corporation (EastWest Bank).

EastWest Leasing, which aims to complement the core lending activities of EastWest Bank will soon operate and contribute to the bank’s growth and further diversify its income sources.

“Our mandate is to develop the leasing business and portfolio, thereby creating synergies with the different business units of EastWest Bank and the Filinvest Group,” said Armando Inabangan, Jr., President of EastWest Leasing.

In July this year, the Bangko Sentral ng Pilipinas (BSP) approved EastWest Bank’s equity investment into EastWest Leasing of P100 million, ten times the minimum regulatory requirement.

"We have completed the major regulatory approvals and are now applying for the requisite local business permits and licenses to start commercial operations. EastWest Leasing is most likely weeks away from providing alternative financing packages to the SME and corporate clients of EastWest,” said Inabangan.

EastWest Leasing will offer competitively packaged financial (direct and sale-and-lease back) and operating leases, factoring, amortized commercial loans, and other financing products and services. The company will initially focus on the existing clients of EastWest and simultaneously partner with various vendors/sellers of equipment and machineries.

According to Inabangan, the generic strategy of the top players in the leasing sector is cost leadership. As the newest entrant in the market, EastWest Leasing will focus on value and customer service. “The competition within the sector is basically based on pricing or low interest rates. Thus, we will not compete directly in terms of pricing. We will exert efforts to compete based on value creation and better customer service,” he noted.

For the first year, Inabangan and his team will work towards heightening market awareness of EastWest Leasing and develop and harness business partnerships with the major vendors/distributors of machineries and equipment.

“The challenge is to penetrate the market, establish market recall and be noticed by competitors aside from creating value for our customers and for the stakeholders. Being a wholly-owned subsidiary of East West Bank, we shall take advantage of the established business channels, market base, and the expertise of its management and Board of Directors,” said Inabangan.

The Philippine leasing industry, which began in the late 1950s, remains strong, with plenty of opportunities ahead. Over the years, the thriving leasing and finance sector has been benefitting from the sustained economic growth, investment grade boost, tamed inflation and lending rates, and the huge consumer market of almost 100 million Filipinos.

At present, the market is dominated by the major leasing companies operating in the country, most of which are also subsidiaries of top domestic banks.