The COVID-19 pandemic has caused people all over the world to make changes in their way of working and living. The rural banking industry had its share of challenges to adapt to changes and continue to provide efficient and reliable banking services to its clients. We try to uphold our commitment to always be by our customers’ side and support the national economic recovery process as champions of countryside development.
In a recent economic briefing organized by the Bureau of Investment (BOI), economists say that the Philippine economy is viewed to be on the path to further strong growth this year despite the threat of spiking COVID cases and opening the economy to more investments. The APAC Chief Economist said that the country’s GDP growth forecast is at 7%, as global recovery is seen this 2022. He said that rapid growth this year is expected due to further progress towards the normalization of the economy driven by private consumption and government infrastructure investments. He added that the Philippines is projected to become one of Asia’s USD one trillion economies by 2033. These positive signs look bright for the countryside, where the rural banks are mostly located.
BSP Governor Benjamin E. Diokno is still confident that banks will remain resilient to withstand tighter global financial conditions this year. Looking at the rural banking industry, based on data from the BSP website (Sept. 2020 & Sept. 2021), the industry’s average growth of Total Resources grew by 11.44% y-o-y ending at P 280.92 billion, while Total Loans grew by 8.77% or to P 148.19 billion from P 136.24 billion which shows that rural banks continued to lend out even during the pandemic. Total deposits likewise grew by 14.62% and Capital improved by 6.43%. More importantly, Net income grew by 36% despite the pandemic. Rural banks likewise have a healthy CAR of 19.10%, which is above the BSP requirement of 10%, and they remained liquid with a liquidity ratio of 56.08%. Growth rates are good and the industry remains stable.
Looking forward, we keep abreast with the changing times and align ourselves to the projects and initiatives of the government. We partner with government institutions like the Department of Agriculture to provide funds for the farmers and fisherfolks, with the Development Bank of the Philippines to provide assistance to the MSMEs. Together with Land Bank and other government agencies, all efforts are geared towards helping the economy bounce back. We likewise align ourselves with BSP’s Digital Payments Transformation Roadmap and started on this journey towards providing our clients with digital streams to remain significant and competitive by providing safe and secure digital financial services. The BSP recognizes the vital role of the rural banks in countryside development and created this Inter-Agency Working Group where the different agencies worked together for the Strengthening Program for the Rural Banking Industry. This multi-stakeholder responsibility is what we need for sustainable growth, and there is no better time to act but NOW!
Rural banks remain proud to be known as the grassroots of the banking industry and the future of the countryside. Like other rural banks, our bank, GRBank, is here to serve your banking needs, provide you with a more personalized customer experience and help you grow your business.