CBS steps up expansion with mini-branches

MANILA, Philippines – Tycoon Henry Sy-led China Bank has teamed up with the SM group’s grocery chain, SaveMore, to speed up the branch expansion program of its thrift bank subsidiary, China Bank Savings (CBS).

The partnership is part of a strategy to boost CBS’ branch network from 45 to 100 by next year, about 30 percent of which will be in the form of “mini-branches” to be hosted by SaveMore. This strategy seeks to unlock synergies within the SM group.

In a briefing on Friday, CBS president Alberto Emilio Ramos said the partnership would be mutually beneficial as it would boost foot traffic for both the thrift bank and the grocery chain.

“CBS can expand its market share from the supermarket’s flow of shoppers and SaveMore can expect increased sales as more of CBS’ shoppers will choose to stop at a SaveMore market housing a CBS branch,” he said.

CBS expects each new in-store branch to break even at a much faster pace than a traditional branch with narrowing margins arising from stiff competition and record-low interest rates. Traditional branches usually break even after four to five years. For a CBS mini-branch, the turnaround can happen in two years, Ramos said.

Jaime Valentin Araneta, CBS executive vice president, said the establishment of in-store branches was also meant to provide access and to better engage people, including prospective customers who will otherwise be intimidated to walk into traditional bank branches.  Doris C. Dumlao