Singapore-based financial services group Right Choice Capital Pte announced that it has received approval from the central bank of the Philippines to proceed with its acquisition of a rural bank in the country.
Financial details of the acquisition were not disclosed.
Right Choice said the deal to acquire Rural Bank of San Luis (Pampanga), a three-branch rural bank in the Philippines with a 50-year history, is part of its rapid business expansion strategy in the country and in Singapore.
The company said it will transform the bank into a fully digital bank while retaining its core of MSME and personal deposit and loan account holders.
“The acquisition of RSBL is a key element in our group’s rapid expansion and diversification strategy,” said Right Choice Capital CEO and founder Kodi Kodrowski.
Kodrowski also hinted that the company is currently negotiating another bank acquisition.
To support its scaling and further acquisitions, Right Choice Capital also announced that it is in the market to raise $10 million in a Series A funding round.
“We expect that there will be significant investor and strategic partner upside as we rapidly grow the business into a much larger financial services & ganking group during these next few years, with an accelerated start to 2023,” Kodrowski added.
The Bangko Sentral ng Pilipinas (BSP) has already approved six digital banks to operate in the country. These include UnionDigital Bank, GoTyme Bank Corporation, Tonik Digital Bank, Maya Bank, Overseas Filipino Bank, and UNObank.
In November 2020, the BSP approved the recognition of digital banks as a new bank category separate and distinct from other bank classifications.
Digital banks are defined as banks that offer financial products and services that are processed end-to-end through a digital platform and/or electronic channels with no physical branches.
To qualify, banks must meet the minimum capitalization of 1 billion pesos ($18 million) and will have to follow all the fiduciary rules imposed on other bank categories.