[Report] 'One Roof, Two Banks'... Joint Branches Emerging as an Alternative to Closures

Gyeonggi Yongin Woori Hana Bank Sinbong Branch
Separate Counters, Ticket Dispensers, and ATMs
Primarily Visited by Elderly Customers

On the 13th, I visited the joint branch of Woori Bank and Hana Bank located in Sinbong-dong, Suji-gu, Yongin, Gyeonggi Province. The two banks shared a space of about 50 pyeong (approximately 165 square meters). With a central partition wall between them, each bank had two counters arranged symmetrically, resembling a 'decalcomania.' Each bank operated its own ticket dispenser, ATM (Automated Teller Machine), and had separate staff members for customer assistance.

On the 13th, customers were conducting banking transactions at the Woori Hana Bank joint branch, Sinbong branch, Suji-gu, Yongin, Gyeonggi. Photo by Kwon Hyunji

Opened in April last year, this branch is the first case in the banking sector where two banks have established a joint branch in a single space. Initially, many customers found this arrangement unfamiliar, but after about a year, many local residents now visit the branch. Over the past year, two nearby commercial bank branches have closed, making this branch the only offline branch available in the neighborhood. Currently, the daily number of visitors is around 60 to 70, which is an increase compared to the early days of opening.

As bank branch closures accelerate, causing inconvenience to financial consumers, joint branches are gaining attention as an alternative. With digital transformation and the expansion of non-face-to-face services, offline bank branches are rapidly disappearing. The number of domestic branches of commercial banks, which was 3,322 at the end of 2018, gradually decreased to 3,256 in 2019, 3,139 in 2020, 2,930 in 2021, and 2,739 by the end of last year. The number of mini-branch offices, known as business offices, also declined from 512 in 2018 to 349 by the end of last year.

Consequently, the inconvenience for consumers who require offline financial services, such as the elderly, has increased as a side effect. From the banks' perspective, joint branches reduce personnel and operating costs, while customers benefit from improved access to financial services, making it a mutually beneficial choice.

This branch also primarily serves elderly customers. On the afternoon of my visit, 8 out of 10 customers were middle-aged or older, aged 50 and above. Therefore, the branch is operated as a 'specialized branch for the elderly.' A bank official explained, "We assign staff experienced in serving elderly customers and, unlike other branches, we did not use tiles to prevent fall accidents."

Customer satisfaction is also high. Mr. Kim (85), who visited the bank that day, said, "I find it difficult to use digital devices, so I come directly to the bank even for simple deposit and withdrawal transactions. Before this branch opened, I had to walk 20 to 30 minutes to busy areas like Suji District Office, but having it near my home is much more convenient." Mr. Kwak, a man in his 50s, also said, "All nearby bank branches have disappeared, so many elderly people are dissatisfied. It's fortunate that at least this branch exists."

ATM machines are lined up side by side at the Woori Hana Bank joint branch in Sinbong, Suji-gu, Yongin-si, Gyeonggi Province. Photo by Kwon Hyunji

Of course, there are many limitations due to it being a joint branch. As a small branch affiliated with a higher-level branch, cash deposit and withdrawal limits are set at 1 million KRW or less, and transfer limits at 10 million KRW or less. To prevent competition, the sale or promotion of deposit products, investment products, and the like are restricted. Only simple tasks such as loan principal or interest payments, card issuance and inquiries, and reporting are possible. Another unique feature of this branch is that it closes from 12 PM to 1 PM. This is because with only two staff members, it is difficult to respond to security incidents with just one person.

Despite high satisfaction, the opening of joint branches is progressing slowly. Currently, there is only one joint branch each in Yangju, Gyeonggi Province and Yeongju, Gyeongbuk Province (KB Kookmin Bank and Shinhan Bank), and in Busan (KB Kookmin Bank and BNK Busan Bank). A bank official explained, "It is not easy for multiple banks to share the same needs and plan and operate a joint branch." It is realistically difficult to find suitable areas and large enough branches to open joint branches.