TWO MORE rural banks have merged, the Bangko Sentral ng Pilipinas (BSP) announced in a circular, a development that is in line with the regulator’s efforts to strengthen the sector through consolidations.
The merger between Manor Bank – A Rural Bank Corp. and Rural Bank of Casiguran (Aurora), Inc. (CSIGU) took effect on June 2, the BSP said in a circular dated June 27.
Manor Bank was the surviving entity and absorbed all the assets and liabilities of CSIGU.
The Securities and Exchange Commission approved on April 29 the articles and plan of merger between the two banks, which was executed on Sept. 11, 2024, the central bank said.
Information from the BSP’s website showed that Manor Bank has four offices and is headquartered in Romblon.
The BSP has been encouraging rural banks to consolidate as part of its Rural Bank Strengthening Program (RBSP) that was launched in 2022.
The RBSP has five time-bound tracks that aim to strengthen the capital position of rural banks, namely merger/consolidation, acquisition/third-party investment, voluntary exit/upgrade of banking license, capital buildup program, and supervisory intervention.
In September 2022, the BSP raised the minimum capital requirement for rural banks with a head office and as many as five branches to P50 million, while those with six to 10 branches must have a minimum capital of P120 million.
Meanwhile, those with more than 10 branches must have a capital of at least P200 million.
Rural banks have until 2027 to comply with the new rules.
In March, the BSP announced the merger of Zambales Rural Bank, Inc. and Bridgeway Rural Banking Corp., with the former being the surviving entity.
Last month, the central bank said it approved the consolidation of four rural banks to form Agribusiness Banking Corp. – A Rural Bank (Agribank), which began operating on June 16.
The rural bank sector booked a combined net income of P3.09 billion in the first quarter, latest BSP data showed. Total assets were at P471.17 billion as of end-March.
As of May, there were a total of 2,884 rural bank offices operating in the Philippines, including those of microfinance-oriented banks. These include 358 head offices. — AMCS