The Bangko Sentral ng Pilipinas (BSP) has approved applications for five regular bank branches and 23 branch-lite units in the first quarter of 2024. This number is lower than the previous year’s first quarter, which saw the approval of three regular branches and seventy-five branch-lite units.
Regular branches are full-sized banks offering complete banking services, whereas branch-lite units provide a wide range of products and services but with limited banking activities, not catering to clients with aggressive risk tolerance.
The central bank is now favouring streamlined branch-lite units offering limited banking services. This is due to the knock-on effect caused by the pandemic and the rise of digital banking, which have led the banking industry to reorganise, streamline, and consolidate traditional branches while increasingly digitalising products and services.
The central bank’s Banking Sector Outlook Survey (BSOS) identifies the digitalisation of banking products and services as a top strategic priority for all banks. The focus is on deposit operations and payment systems, with larger banks more advanced in their digital transformation.
In total, there were five regular bank branches and fifteen branch-lite units that applied for BSP approval in Q1 2024. The larger banks did not seek approval to open new regular branches but two universal and commercial banks — namely Bank of the Philippine Islands (BPI) and Maybank of the Philippines — applied for five branch-lite units in Cauayan City, Dipolog City, Tagum City, and Tuguegarao City.
Only one thrift bank, 1st Valley Bank in Lanao Del Sur, applied to open a branch-lite unit. Four rural and cooperative banks requested approval for five regular bank branches and 17 branch-lite units in the first quarter.
These smaller banks include Cebuana Lhuillier Rural Bank Inc., LifeBank, Mount Carmel Rural Bank, and Rural Bank of Bansud Mindoro.
During this period, only one regular bank branch and three branch-lite units were opened by three large banks: BDO Unibank Inc., Maybank, and Security Bank Corp.
In total, eight regular branches, 27 branch-lite units, and one Islamic bank were opened in the first quarter. The Islamic bank is CARD Bank, Inc., a microfinance-based rral Bank, was opened in Cotabato City.
Of the eight regular branches, one was from a large bank, three from thrift banks, and four from rural and cooperative banks. Most of the 27 branch-lite units were opened by rural and cooperative banks.
As of the end of June 2024, the BSP supervises 44 big banks, 42 thrift banks, 364 rural banks, and 22 cooperative banks. There are currently 12,886 bank branches in the country, with 7,123 operated by big banks, 2,567 by thrift banks, and 3,196 by rural and cooperative banks.
Featured image credit: Edited from WikiMedia