RIZAL Commercial Banking Corp. (RCBC) recently transferred its credit card business to a new issuer as it assured that this move would have effect to any of its cardholders.
John Thomas Deveras, RCBC executive vice president, on Friday announced the transfer of the management of its credit card business to RCBC Bankard Services Corp. (RBSC) from its former issue Bankard Inc.
On December 27, 2013, RCBC completed the sale of its 65.42-stake in Bankard Inc. to RYM Business Management Corp. and other undisclosed investors.
The transaction allowed RCBC to recognize a net gain on sale of about P123 million, monetizing the value inherent in the listed corporate vehicle.
“Aside from enhancing the bank’s product offering and customer reach, this transaction will allow RCBC to book a net gain of P69 million while RCBC Capital will recognize a net gain of P54 million,” Deveras said.
He noted that RCBC’s net gain on sale is about P123 million after taxes and fees. Meanwhile, Deveras explained that even before the sale of Bankard Inc. the bank’s credit card portfolio has always been booked to the balance sheet of the RCBC.
“So what had to be transferred to the new company are the offices and staff and the licenses and operation. There should really be no effect in any of our cardholders,” he said. The bank’s portfolio for its credit card business was at P12 billion. For 2014, RCBC is looking at a 25-percent growth on its credit card portfolio from an average 20-percent growth for the past three years.
Meanwhile, the new issuer—RBSC—is optimistic on its goal to be at the Top 5 in terms of credit card business in the Philippines.
Oscar Biason, RBSC president and chief executive officer, said he is projecting about 150,000 additional credit card issuances this year, on top of the 600,000 currently issued.
However, Biason said that reaching one million credit card issuance is not in the company’s near term plan saying it will continue its growth conscious about asset quality.
He also said that RBSC is also not focusing on certain age bracket in acquiring customers but will definitely launch new products that are unique to strengthen its relevance to the clients.