May 08, 2024

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[THE INVESTOR] NH NongHyup Bank plans to slash the number of branches next year to streamline operations, according to industry sources on Oct. 26.

Unlike other major banks, the agriculture cooperative-based bank with 849 branches, has not closed any branch this year citing its popularity in rural areas and loyal customers from the older generation.

“Despite the increasing use of mobile banking services, it has not been easy to reduce the number of branches due to the nature of the bank,” a senior official said. “But next year we plan to reduce the number of branches by half of what commercial banks have done to improve efficiency,” he added. 

The country’s four major commercial banks have closed a total of 40 branches in the first nine months, led by KB Kookmin Bank which shut down 20 of its 900 branches.

The bank will wait until the Financial Supervisory Service announces planned guidelines for the closure of bank branches. FSS Gov. Yoon Suk-hun warned in July that “best practices” for bank branch closure will be announced later this year to protect customers.

“We are currently discussing with the Korea Federation of Banks,” an FSS official said. “We are aware of the factors behind the closure of commercial bank branches, such as the development of internet banking, and it does not mean that we will block branch closure unconditionally.”



By Park Ga-young (gypark@heraldcorp.com)