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Article
Publication date: 17 March 2020

Wenling Lu and Judith Swisher

The purpose of this research is to examine the growth rates of commercial banks and credit unions around the financial crisis and recovery. Credit unions are analyzed as a group…

Abstract

Purpose

The purpose of this research is to examine the growth rates of commercial banks and credit unions around the financial crisis and recovery. Credit unions are analyzed as a group and by field of membership. Specifically, this research analyzes the growth rates of assets, deposits, and loans.

Design/methodology/approach

This research employs univariate tests of differences to examine the median growth rates for commercial banks and credit unions. Unbalanced pool regressions analyze growth rates during the pre-crisis, crisis, and recovery periods, controlling for size, net charge-offs, and unemployment.

Findings

Univariate test results that control for size show that banks grow at faster rates than credit unions for most of the pre-crisis years. However, medium sized credit unions grow at faster rates for most of the crisis and recovery years. Results of unbalanced pool regressions suggest that, overall, credit unions grow at slower rates than do banks. However, during the crisis and recovery, credit union growth is significantly greater than that of banks, after controlling for net charge-offs, size, and unemployment. Credit union growth varies by field of membership type.

Originality/value

Although a large volume of research examines commercial bank performance around the financial crisis, only a few papers assess the performance of credit unions. And very few papers compare commercial banks and credit unions. This paper explores how the recent financial crisis influenced the growth of commercial banks and credit unions from 2005 to 2013.

Details

American Journal of Business, vol. 35 no. 1
Type: Research Article
ISSN: 1935-5181

Keywords

Article
Publication date: 22 April 2006

Judith Swisher

A dual‐class share structure allows managers or original owners to retain control of a firm, while providing public equity financing. In the U.S., a firm generally issues…

Abstract

A dual‐class share structure allows managers or original owners to retain control of a firm, while providing public equity financing. In the U.S., a firm generally issues superior‐voting shares to managers or original owners, and inferior‐voting shares to the public. As a result of the separation of control and risk bearing, the potential for agency problems exists. Theory predicts and some evidence shows that the use of a dual‐class share structure leads to a lower firm valuation than would otherwise exist. However, theory also suggests that separation of control and risk bearing might be desirable in some situations, since it allows managers to make long‐term investments without fear of a hostile takeover. Thus, a dualclass share structure could result in superior performance. This study addresses the question that confronts investors with respect to dual‐class firms: “Are inferior‐voting shares inferior investments?” Specifically, this research investigates the stock performance of companies that have dual‐class shares. Overall, results show that investors in inferior‐voting shares do not earn abnormally low risk‐adjusted returns. Investors in non‐IPO inferior‐voting shares earn positive abnormal risk‐adjusted returns.

Details

American Journal of Business, vol. 21 no. 1
Type: Research Article
ISSN: 1935-5181

Keywords

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