Overwhelming Philippine Banks

The Philippine banks vary from universal, rural, commercial, thrift banks, rural, credit union, and even non-banks but still with quasi-banking functions.

All of these banks are licensed with the Central Bank of the Philippines commonly addressed as the Bangko Sentral ng Pilipinas.

Different Kinds of Philippine Banks and Their Functions

Financial institutions are always classified according to their size and functions. The country's banking institutions are categorized as commercial, universal, thrift, cooperative and rural banks, and those that are defunct or merged banks.

Commercial and universal banks seem to have the same functions. These bank classifications are by virtue of the Republic Act No. 8791 or the commonly known General Banking Act of 2000. Commercial bank functions to accept drafts and issue letters of credit. It also has the power to discount or negotiate promissory notes, drafts, bills of exchange, and proofs of debt. Commercial bank works in accepting or creating demand deposits and even accepts other kinds of deposits.

This kind of bank also has the right to buy and sell foreign exchange and even precious metals such as gold and silver. It may also assume saleable debt instrument and securities as it also has the power to extend credit. There are 23 commercial banks existing in the country.

Universal banks on the other hand assume powers similar to a commercial bank but it has some extended powers. It can work on an investment house. This extended power that universal banks have is elaborated in present laws with the power to commit in non-allied projects. So far, there are three government-owned universal banks in the Philippines. These are the Amanah Islamic Investment Bank of the Philippines, Development Bank of the Philippines, and Land Bank of the Philippines. There are about ten privately owned universal banks in the country and about four foreign banks with universal banking operations.

To accept savings and time deposits are just few of the functions of thrift banks. They can also act as an analogous or representative to other banking institutions and as collection agents for government transactions, issue, mortgages. They can also be involved in real estate deals and they can extend credits too. These kinds of banks can be involved in similar banking and money market operations subject under the Bangko Sentral ng Pilipinas' approval. There are so many privately owned thrift banks in the country and the Philippine Postal Savings Bank is the sole government owned thrift bank in the country.

Cooperative and rural banks promote and thrives the rural economy in an orderly and trenchant way simply by offering the people in agricultural communities with basic financial services. This is a big help among farmers in their industry. Cooperative banks are often established by cooperatives or some cooperative organizations. Rural banks on the other hand are often owned and managed by private corporations.

There are about 44 cooperative banks all over the country and several rural banks are situated in almost every region or even province in the Philippines.

There are extensive Philippine banks across the country that caters to the different banking needs of every industry and financial needs of its people.

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