Dozens of Bank Branches Disappear... Joint Branches Appear Rarely Like Beans in a Drought [1mm Financial Talk]

Financial Services Commission's Plan to Strengthen Store Closure Measures
Implementation Status and Actual Condition Inspection Plan

Although offline bank branches are disappearing, the joint branches opened as an 'alternative' in the banking sector are showing signs of decline.

According to the financial sector on the 23rd, the joint branches of the five major banks?KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup?number only five nationwide as of this date.

In April last year, Hana Bank and Woori Bank opened the first joint branch in the banking sector in Sinbong-dong, Suji-gu, Yongin-si, Gyeonggi-do. In May, KB Kookmin Bank and Shinhan Bank opened two joint branches in Yangju, Gyeonggi-do, and Yeongju, Gyeongsangbuk-do, and in September, KB Kookmin Bank opened a joint branch with BNK Busan Bank in Geumgok-dong, Buk-gu, Busan, emerging as an alternative to bank branch closures. In December, Hana Bank and Woori Bank opened a joint automated branch in Hanam, Gyeonggi-do, but since it has no face-to-face counters, it cannot be considered a practical joint branch.

However, this year, the only development was on the 21st when KB Kookmin Bank began operating a separated joint branch with Korea Citibank in Seo-gu, Daejeon. A representative from a commercial bank said, "Many joint branches were established last year, but recently the atmosphere has been almost quiet," adding, "To create a joint branch, the customer base must match, and the two banks must collaborate, so it is not easy in reality." Moreover, recently, there is a stronger focus on collaboration with post offices rather than joint branches among banks. A financial regulator said, "Since the damage caused by branch closures is mostly concentrated in island and mountainous areas rather than Seoul, banks tend to focus on partnerships with post offices."

Bank branches have been steadily disappearing every year. An analysis of the business reports of the four major banks shows that the number of branches (branches + sub-branches) decreased by 196 from 3,079 in 2021 to 2,883 in 2022, and as of the end of June this year, 2,818 branches remained, with 65 disappearing in the first half of the year alone. By bank, KB Kookmin Bank closed 62 branches, and Woori Bank closed 5. Shinhan and Hana Banks increased their branches by one each compared to the end of last year.

However, since the Financial Services Commission announced the 'Plan to Enhance the Substance of Bank Branch Closures' last April, the pace of branch closures has gradually slowed. Compared to March, KB Kookmin Bank closed 24 offline branches, Shinhan Bank closed 7, and Hana and Woori Banks maintained the status quo. To reduce financial consumer damage caused by branch closures, the Financial Services Commission required banks to prepare 'alternative branches' before deciding to close branches, expanded the management disclosure related to branch closures from once a year to four times a year, and added information such as closure dates, reasons, and alternative measures. The Financial Services Commission also plans to conduct an on-site inspection related to bank branch closures this month. A Financial Services Commission official said, "The intention is not to block branch closures themselves due to banks' interests, but to strengthen consumer protection," adding, "We are planning to check compliance and other matters."

This content was produced with the assistance of AI translation services.