Chinatrust buys ABN Amro’s loan portfolio

Chinatrust (Philippines) Commercial Bank Corp. said yesterday it had purchased the personal loan portfolio of ABN Amro Bank and is looking at other such acquisitions.

Chinatrust, a subsidiary of Taiwan’s Chinatrust Commercial Bank, did not disclose the value of the portfolio it acquired from ABN Amro.

"Several more portfolio acquisitions are being seriously pursued by the bank, including the mortgage and salary loan portfolios of financial institutions and home developers," Chinatrust said in a disclosure to the stock exchange.

A Chinatrust spokeswoman told Reuters the acquisition will mark the bank’s entry into the personal loan business. It was a purely corporate bank previously.

The disposal by ABN Amro followed the sale of 20 of its thrift bank branches locally and liabilities in excess of P5 billion to a wholly owned banking unit of J.G. Summit Holdings in March.

The country’s second largest bank, Bank of the Philippines Islands, purchased the auto and mortgage loans portfolio of ABN Amro in March.

The Dutch bank is shedding non-core assets to focus on core client segments globally, and has kept just one branch in the Philippines following the asset sales.

The Bangko Sentral ng Pilipinas (BSP) has encouraged banks to lend more, especially with interest rates low, to spur economic activity.

ABN Amro president Carmelo L. Bautista said the sale is in line with the bank’s focus on corporate and institutional banking. Bautista added that the sale of its personal loan portfolio would allow the bank to increase focus on corporate finance, mergers and acquisitions, the financial markets, cash management, and trade services.

"Private banking and asset management will continue their presence in the bank," Bautista added in a press statement. ABN Amro has total assets of $60 billion and operates in 60 countries.

Meanwhile, the acquisition benefits Chinatrust Phils., which has been aggressively courting the consumer or retail banking sector. Recently, it launched a unique housing loan product valued up to P8 billion.

"With this personal loan portfolio, Chinatrust immediately becomes a major player in the personal loan business," said Joey A. Bermudez, president and chief executive officer of Chinatrust Phils.

"The challenge is not just to launch new products, but to ensure that our customers derive distinct and meaningful values from these products," he added.

By 2007, the Taipei-based bank would have consumer banking products accounting for 40 percent of its activities while the remaining 60 percent will come from corporate and institutional banking.

At present, nearly all the bank’s activities are focused on corporate banking, with 60 percent of their market in the Taiwanese business sector and the 40 percent with local corporates.

Earlier, ABN Amro Savings Bank sold its branch network to Robinsons Savings Bank. The 20-branches were sold for more than P5 billion. It likewise sold the auto and mortgage loan portfolio to BPI Family Savings Bank. – Ted Torres