Announcement of Major Philippine Leasing Company Formed on August 18, 1980

• International Finance Corperation IFC Press Release No. sf/Ii 0 Monday, August 18, 1980 1818 H Street. N.W. Washington. D C. 20433. U .SA 202-4 77-1234 Majo~ Philippine Leasing Company Formed A Philippine leasing company which seeks to assist private enterprises with emphasis on small and medium-size business has been launched by a group of Philippine based investors, headed by the Philippine Investments sistems Organization (PISO), in cooperation with the Land Bank of the Philippines (LBP), the Intemational Finance Corporati9n (IFC) and the Private Investment Company for Asia' (PICA) • The Company, PISO Leasing Corporation, with an initial capitalization of $8.85 million, will concentrate on reasing industrial equipment to the Philippine . businesses. • PISO Leasing is designed to fill in the perceived. gaps and strengthen cur- rent leasing operations in the Philippines. The Co~pany's sponsors feel that they will be able to tap the small and medi~size business market by providing these companies, whose access to existing capital markets is frequently restricted by strict collateral requirements, with an alternative source of long-term financ- ing. IFC, the World Bank affiliate which supports economic development through assistance to the private sector, is providing $5 million in long-term. loans, of which $3 million will be sold as a participation to PICA. LBP is providing an additional $2 million peso equivalent long-term loan. Of the: $1 million equity funds contributed by the sponsors, PISO, a Philip- pine owned investment:· bank, has invested $300,000. Chemical Industries of the Philippines, Inc., a well-known diversified Philippine industrial firm, and Mr. Rafael M. Atayde, a leading industrialist, have both participated in the amount of $100,000. IFC, LBP and PICA have each provided $150,000. Other Philippine investors are p~viding $50,000. The balance of the financial plan, $850,000, will be in th~ form of sub- • ordinated loans that will be taken up by all the sponsors except IFC • /i i\ \\ • - 2 od, In addition to offering its client longer term leases, the Company intends to provide foreign exchange denominated leases. The Company will emphasize the leasing of industrial equipment needed by such industries as food processing, textile and garment manufacturing, wood processing, paper, and medical and health services. The Company is based in Manila but will provide services throughout the country. It has started extending lease financing assistance to a number of enterprises since its incorporation last November 26 • • [Any inquiries relating to IFC' s participatA-Qµ in this project should be directed to the IFC Information Office, 18l~_l Street, N.W., Washington, D.C. 20433, Telephone (202) 676-0394.] •