Security Bank to open 10 branch-lite units
SECURITY BANK Corp. is eyeing to open 10 branch-lite units in Metro Manila in 2019 to test the viability of the dressed-down bank office concept.
Leslie Y. Cham, Security Bank branch banking group head, said the lender plans to open 10 small branches in Makati, Pasig and Mandaluyong this year, constituting the first tranche of its branch-lite unit roll-out.
“We want to make sure and test the branch-lite concept. We wanted to make sure the branchlite to make profit immediately,” Mr. Cham said at the sidelines of the bank’s economic forum last month.
In December 2017, the Bangko Sentral ng Pilipinas allowed banks to set up branch-lite units. This kind of branch is compact and less formal compared with the typical brick-and-mortar bank branch, and can be opened in towns which are unbanked or underserved.
Mr. Cham said the lender opted to establish its first branch-lite offices in the three cities where its presence is “lacking” despite having huge deposit levels.
“We’ll concentrate on the three first and let’s test the new model,” he said.
Eventually, Security Bank will set up more dressed-down branches in “very high provincial areas” in 2020.
“As much as possible, we don’t want to put in a lot of brick-andmortar (branches) right now. If we could use other means of distribution in terms of reaching our clients at a cheaper mode, that’s how we want it,” Mr. Cham added.
At last month’s economic forum, Security Bank President and Chief Executive Officer Alfonso L. Salcedo said the lender’s distribution strategy over the next five years is to move away from being “too dependent” on branches amid its development of its digital platforms.
“As we all know, that (branch network) is the most expensive distribution channel,” he said. “While they are [still] going to be a major part of the distribution strategy, we are looking to moderate its importance. For us, we already have good development in our e-commerce platform.”
Security Bank booked a net profit of P8.6 billion in 2018, down 16% from a year ago due to decrease in trading gains and higher provisions for income tax.
Shares in Security Bank closed at P175 apiece on Tuesday, up P3.30 or 1.92%.