Japan's Mitsubishi UFJ Acquires Second-Tier Financial Firms in the Philippines and Indonesia

[Asia Economy Reporter Jeong Hyunjin] Mitsubishi UFJ Financial Group of Japan plans to acquire secondary financial institutions in the Philippines and Indonesia to expand its business base in Southeast Asia, Nikkei reported on the 24th.

According to the report, Mitsubishi UFJ will acquire local subsidiaries in the Philippines and Indonesia from the Dutch lending company Home Credit for 600 million euros (approximately 840 billion KRW) next year. It will purchase 100% of the shares of the Philippine subsidiary and 85% of the shares of the Indonesian subsidiary.

The reason Mitsubishi UFJ is acquiring Southeast Asian subsidiaries of secondary financial institutions is due to the strength of "digital lending." Nikkei explains that Home Credit has a high market share in POS loans, which provide funds for purchasing home appliances by determining loan eligibility and conditions within seconds after entering occupation and salary information into a smartphone application (app).

Nikkei evaluated, "By digitalizing everything from screening to lending and repayment, it becomes a means to cultivate individual customers in Southeast Asia, where economic growth continues."

Nikkei also reported that Japanese financial companies have recently been focusing on expanding their presence in Southeast Asia through digital enhancement. Mizuho Bank invested in Tonik Financial, which operates a digital bank in the Philippines, in February.

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