Types of Banks in the Philippines

UNIVERSAL & COMMERCIAL BANKS represent the largest single group, resource-wise, of financial institutions in the country. They offer the widest variety of banking services among financial institutions. In addition to the function of an ordinary commercial bank, universal banks are also authorized to engage in underwriting and other functions of investment houses, and to invest in equities of non-allied undertakings.

Universal Banks offer the widest variety of services among all financial institutions in the Philippines today. In addition, only banks under this category can engage in the functions of an investment house such as underwriting. Universal banks can also invest in equities of non-allied undertakings.

Commercial Banks offer the same variety of banking services offered by a universal bank. However, it cannot engage in underwriting and other functions of an investment house.

THRIFT BANKING SYSTEM Thrift banking system is composed of savings and mortgage banks, private development banks, stock savings and loan associations and microfinance thrift banks. accumulates the savings of its depositors and invests it. Most thrift banks are known to provide short-term working capital, and medium- and long-term financing to businesses engaged in agriculture, services, industry, housing and allied services, especially to small and medium enterprises.

Thrift Banks They also provide short-term working capital and medium- and long-term financing to businesses engaged in agriculture, services, industry and housing, and diversified financial and allied services, and to their chosen markets and constituencies, especially small- and medium- enterprises and individuals.

RURAL & COOPERATIVE BANKS Rural and cooperative banks are the more popular type of banks in the rural communities. Their role is to promote and expand the rural economy in an orderly and effective manner by providing the people in the rural communities with basic financial services. Rural and cooperative banks help farmers through the stages of production, from buying seedlings to marketing of their produce. Rural banks and cooperative banks are differentiated from each other by ownership. While rural banks are privately owned and managed, cooperative banks are organized/owned by cooperatives or federation of cooperatives.

Rural Bank commonly found in far-flung areas that cannot be reached by bigger banking institutions. These privately-owned banks provide basic financial services to the small but growing economies in the countryside. More often than not, the rural banks are the ones helping farmers through the stages of production--from providing loans for inputs and irrigation to harvest.