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Article
Publication date: 1 February 1984

Terry E. Ashforth and Geoffrey N. Soutar

Research among credit unions in Western Australia is reported in which directors and managers of credit unions expressed their attitudes with regard to the corporate…

Abstract

Research among credit unions in Western Australia is reported in which directors and managers of credit unions expressed their attitudes with regard to the corporate objectives of their organisation, and future directions of development for the credit union movement are suggested.

Details

International Journal of Bank Marketing, vol. 2 no. 2
Type: Research Article
ISSN: 0265-2323

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Article
Publication date: 1 March 1982

Barbara R. Lewis

Examines the strength of credit unions in the UK, and assesses their future developments and possible threat to the clearing banks in terms of competing for the same…

Abstract

Examines the strength of credit unions in the UK, and assesses their future developments and possible threat to the clearing banks in terms of competing for the same markets. Emphasises that the first credit union was formed in 1846 by Bavarian farmers who pooled their savings and made loans to neighbours, during a bad winter, at lower rates than commercial lenders. Says there are at present 200,000 credit unions world‐wide with 120million members, though the UK possesses only 55 credit unions with less than 10,000 members and assets of only £1million. Discusses potential markets in the UK and gives opinions on this. Looks at various other savings and loan institutions and at attitudes to clearing banks. Concludes that there is much to be gained by obtaining credit union accounts.

Details

European Journal of Marketing, vol. 16 no. 3
Type: Research Article
ISSN: 0309-0566

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Article
Publication date: 1 November 1977

E SAMMONS

There is talk of legislation on credit unions in the next session of Parliament. This article looks at the history and philosophy of credit unions; in a future issue we…

Abstract

There is talk of legislation on credit unions in the next session of Parliament. This article looks at the history and philosophy of credit unions; in a future issue we hope to have an article about the Pitney‐Bowes credit union — the first employees' credit union in this country.

Details

Industrial and Commercial Training, vol. 9 no. 11
Type: Research Article
ISSN: 0019-7858

Article
Publication date: 1 September 2003

Nicholas Ryder

This paper examines the regulatory regime of the Financial Services Authority towards the credit union movement in Great Britain as contained in the Credit Union

Abstract

This paper examines the regulatory regime of the Financial Services Authority towards the credit union movement in Great Britain as contained in the Credit Union Sourcebook. The author discusses the merits of a strong regulatory regime towards credit unions within Great Britain and concludes that such an approach could improve the traditional perception of credit unions, increase the protection of members and increase awareness of the benefits of joining a credit union.

Details

Journal of Financial Regulation and Compliance, vol. 11 no. 3
Type: Research Article
ISSN: 1358-1988

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Article
Publication date: 9 May 2008

Krishnan Dandapani, Gordon V. Karels and Edward R. Lawrence

Existing empirical evidence indicates internet banks worldwide have underperformed newly chartered traditional banks mainly because of their higher overhead costs. The…

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Abstract

Purpose

Existing empirical evidence indicates internet banks worldwide have underperformed newly chartered traditional banks mainly because of their higher overhead costs. The purpose of this paper is to examine the impact of internet banking services on credit union activity.

Design/methodology/approach

The impact of internet banking services on credit union over the period 1999‐2006 was studied and regression equations were estimated for the growth in assets, operating expenses and return on assets as functions of portfolio characteristics, economic conditions and a dummy variable indicating if the credit union has adopted internet banking services.

Findings

The operating costs of credit unions providing web access were found to be significantly higher than those credit unions which do not have any web account offerings. There is increased growth in assets for the credit unions which have worldwide web accounts although this relationship is statistically significant in only three of the eight years studied. The return on assets show that the credit unions with web accounts have similar average profitability to those credit unions that do not provide the facility of internet access to their customers.

Research limitations/implications

Consideration could be given to running the regressions with the number of years the web site has been in place instead of just a dummy variable and putting in common bond dummy variables. Some common bonds are so narrow it may not pay to have internet services.

Practical implications

Even though there are costs associated with providing internet services, the retention of profitability and the evidence of potentially higher asset growth rates suggest the importance of internet banking and the trend of internet banking adoption is expected to continue in the near future in the credit union industry.

Originality/value

This is a pioneering study on the effect of internet banking services on the costs, growth and profitability of Credit Unions in the USA.

Details

Managerial Finance, vol. 34 no. 6
Type: Research Article
ISSN: 0307-4358

Keywords

Book part
Publication date: 11 September 2012

Mark Klinedinst

The global financial meltdown brought to light a number of weaknesses in the U.S. financial system. Not all financial institution types will be taking large sums of…

Abstract

The global financial meltdown brought to light a number of weaknesses in the U.S. financial system. Not all financial institution types will be taking large sums of taxpayer money to address their crippling decisions. Credit unions in the United States represent a type of financial cooperative that will probably not take any taxpayer money directly due to their structure and prudential oversight. Commercial banks, especially the megabanks, are likely to see even more bailouts in the future unless structural weaknesses are addressed in the clarifications as part of the enforcement of the Dodd-Frank Act. Using a unique panel data set on U.S. commercial banks, thrifts and credit unions from 1994 through 2010 performance metrics on a number of dimensions (over 300,000 observations) point to strengths and weaknesses of the various financial institutional forms. Credit unions also have had far fewer adjustable rate mortgages and mortgage-backed securities as a percentage of their portfolio. Robust estimators to correct for potential endogeneity are used to analyze the return on assets differentials between different institutional forms and portfolios. When controlling for size, region and portfolios credit unions are often estimated to have a better return on assets. Institutions with assets under 50 million dollars, about 50 percent of the total sample, show credit unions having higher efficiency in that they control more assets per dollar spent on salaries than commercial and savings banks.

Details

Advances in the Economic Analysis of Participatory and Labor-Managed Firms
Type: Book
ISBN: 978-1-78190-221-9

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Article
Publication date: 29 March 2021

Antonius Sumarwan, Belinda Luke and Craig Furneaux

This paper aims to explore how accountability to members is practised within credit unions. In particular, this study examines formal and informal practices and underlying…

Abstract

Purpose

This paper aims to explore how accountability to members is practised within credit unions. In particular, this study examines formal and informal practices and underlying approaches regarding accountability to members.

Design/methodology/approach

Adopting a case study approach, this study explores accountability within two credit unions in the lightly-regulated context of Indonesia through focus group discussions with credit union practitioners and documentary analysis.

Findings

Findings reveal both credit unions prioritised accountability to members for financial and social performance, underpinned by a socialising, relational approach and driven by a strong sense of social mission. Various mechanisms were adopted to directly address accountability to and empowerment of members, facilitating their participation and education. Further, several mechanisms of and approaches to accountability to other stakeholders indirectly enhanced the credit unions’ accountability to members.

Research limitations/implications

This study highlights the interrelated nature of credit unions’ accountability mechanisms to members. Further, empowerment through participation, education and small business development, suggests valuable investment in members’ social, intellectual and financial capital.

Originality/value

This study examines the socialising nature of accountability to credit union members and other stakeholders to support members’ interests, providing insights into how third sector organisations more broadly might enhance accountability to those the organisation seeks to serve.

Details

Qualitative Research in Accounting & Management, vol. 18 no. 2
Type: Research Article
ISSN: 1176-6093

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Article
Publication date: 1 February 1996

W. John Turner

Examines the changes that have taken place in personal banking in the 1980s and 1990s in the UK and the impact that these changes have had on the C2D market segment…

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Abstract

Examines the changes that have taken place in personal banking in the 1980s and 1990s in the UK and the impact that these changes have had on the C2D market segment. Suggests that, following efforts to attract such customers in the early and mid‐1980s, the banks have been following a strategy of de‐marketing to these customers in the late 1980s and 1990s. Suggests that this strategy may be misguided. Draws parallels with recent developments in food retailing which would suggest that new banking concepts are needed rather than neglect or abandonment of market segments. Examines the development of credit unions in the 1980s and 1990s. These provide an alternative banking concept which is successful and well liked by its members but which in the UK (unlike other developed countries) has yet to achieve a significant foothold in the mainstream financial services marketplace. Suggests that bringing closer together the clearing banks and the credit union movement could form the basis of a new banking concept, with benefits for all parties.

Details

International Journal of Bank Marketing, vol. 14 no. 1
Type: Research Article
ISSN: 0265-2323

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Article
Publication date: 4 July 2016

Gregory J McKee and Albert Kagan

The purpose of this paper is to assess product and service arrays of community banks within competitive markets that are impacted by varying sized financial institutions…

Abstract

Purpose

The purpose of this paper is to assess product and service arrays of community banks within competitive markets that are impacted by varying sized financial institutions. A cost efficiency model is used to understand the relationship of product offerings and business cycle response upon bank performance.

Design/methodology/approach

A cost efficiency model is used to understand the relationship of product offerings and business cycle response upon bank performance. Markets comprised of alternate size and type of financial institutions are compared.

Findings

Greater values of X_EFF i when institutions compete are observed in this analysis. Cost efficiency is lowest when community banks are the only institution in the market, and second lowest when credit unions are the only competing institutions. Call report data are analyzed from 1994 to 2013. The number of big banks increases community bank efficiency and efficiency of large banks. Also, the number of community banks does affect big bank cost efficiency. The magnitude of the effect pertaining to the number of community banks upon big bank efficiency is much smaller than that of the number of big banks on community bank efficiency.

Originality/value

This study considers cost efficiency and profitability as measures of institution on the performance of a competing institutional type. The modeling approach uses cost efficiency as a method of observing the performance of financial institutions and an explanation of how firms persist, grow, and respond to changes in technology or regulation. The effects of the presence of each type of financial institution on the performance of another type are compared. Situations in which any number of one or more institutional types is present in a market are considered for analysis purposes.

Details

International Journal of Bank Marketing, vol. 34 no. 5
Type: Research Article
ISSN: 0265-2323

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Article
Publication date: 4 May 2020

Hoang Van Cuong, Hiep Ngoc Luu, Loan Quynh Thi Nguyen and Vu Tuan Chu

The purposes of this paper are twofold. First, it analyses the income structure in cooperative financial institutions and examines how traditional and non-traditional…

Abstract

Purpose

The purposes of this paper are twofold. First, it analyses the income structure in cooperative financial institutions and examines how traditional and non-traditional incomes are related. Second, it evaluates whether increasing diversification towards non-traditional incomes facilitates or hampers the benefits of financial cooperative owners.

Design/methodology/approach

Data are collected from over 3,100 US credit unions over the period of 1994–2016. A number of modern econometric techniques are employed throughout the analysis, including the use of panel fixed effect, generalised method of moments (GMM) and two-stage least square (2SLS) methodologies.

Findings

Using US credit unions as the empirical setting, the empirical results reveal that the expansion of traditional income leads to a corresponding increase in income from non-traditional activities. However, an increasing reliance on non-traditional income causes a significant drop in interest margins. The authors also find that the extent to which income diversification affects owner benefit varies across credit union types and period of time. While income diversification negatively affects owners' benefits in single common bond credit unions, it has no significant influence on multiple common bond and community credit union owners' benefits. Third, diversification can be beneficial during crisis time, but can be detrimental to owner benefit during normal time.

Originality/value

This paper provides some of the first empirical investigations on the diversification strategy of cooperative financial institutions. Therefore, the results offer significant policy implications for policymakers and market participants on whether financial cooperatives should diversify or specialise.

Details

International Journal of Managerial Finance, vol. 16 no. 4
Type: Research Article
ISSN: 1743-9132

Keywords

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