Asia United Bank plans 30-branch expansion

Asia United Bank (AUB) is looking to add another 30 branches to its existing 26-branch network in identified growth areas within three years.

AUB executive vice president Vic Lim said the bank’s applications to open up new branches have been filed with the Bangko Sentral ng Pilipinas (BSP).

He said they have already identified growth areas for the new branches, which will either be acquired from other banks or put up as new structures.

Upon securing the BSP’s nod, Lim said AUB will open an average of 10 new sites per year in the next three years.

"If we get the approval, we would hit the ideal number of branches of between 50 to 60," Lim said, adding that the new branches will be put up mainly in the Metro Manila area and its outskirts.

Most of the branches will operate on a regular commercial banking basis even as they are considering establishing small and medium enterprises (SME)-oriented ones.

However, the branch expansion will not come via the acquisition route as the process is deemed too tedious and expensive, Lim said.

He pointed out that AUB would prefer to grow organically since it is considered medium in size, establishing its niche market rather than compete with the major players in the commercial banking system.

The bank already has a foothold in foreign trade transactions and the wholesale or consumer market, including personal and salary loans.

The bank has likewise made inroads in the remittances market through partnerships with foreign remittance agencies in Kuwait, United Arab Emirates, Bahrain and Spain. In 2003, its remittance earnings nearly broke the $40-milllion barrier.

In that same year, AUB’s foreign exchange business grew by 21.4 percent to $349.1 million from $287.5 million the year before.

Domestic trade transactions likewise improved to P4.1 billion.

AUB presently has 26 branches, strategically located in economic growth zones and the Chinese-rich Binondo area.

However, a branch expansion moratorium has been in force as monetary and financial regulators are encouraging the country’s banking system to consolidate in the face of strong opposition from regional players.

The bank recorded significant numbers in 2003 on the strength of doubled earnings from salary loans and impressive treasury gains. It is bullish that these gains could be sustained if its branch network would double in size.