It was in June 6, 1952 when Congress of the Philippines approved and make it into law Republic Act No. 720 also known as “Rural Bank Act.” It was enacted to promote and expand the rural economy in an orderly and effective manner by providing the people of the rural communities with the means of facilitating and improving their productive activities, and to encourage cooperatives.  It is the government objective to encourage and assist in the establishment of a system of rural banks which will place within easy reach and access of the people credit facilities on reasonable terms. The Department of Agriculture and Natural Resources, the Department of Commerce and Industry, and other agencies and instrumentalities of the Government, in cooperation with the Rural Bank, provide advices on business or farm management and proper use of credit for production and marketing while the Central Bank of the Philippines now known as Bangko Sentral ng Pilipinas formulates the necessary rules and regulations governing the establishment and operation of the  Rural Banks for the purpose of providing adequate credit facilities to small farmers and merchants, and to supervise the operation of the rural banks.

It was in September 22, 1970 when a group of socio-civic minded people of Magdalena and Liliw, towns in Laguna joined hands and shared their capital and conceptualized the establishment of a Rural Bank.  It was in November 27, 1970 that Bangko Sentral ng Pilipinas thru the Monetary Board approved its application to operate thus RURAL BANK OF MAGDALENA (Laguna), INC. opened its door to serve the public on December 7, 1970. It is committed to live up to the objective and purpose in the creation of rural banking.