Economies of scale in large credit unions

Taylor, Ryland A.

doi:10.1080/00036847200000004

Cited by 35 publications

(24 citation statements)

References 6 publications

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“…Primary emphasis in previous studies using this approach is directed toward deriving all relevant variables which affect costs (Taylor, 1972;Wolken and Navratil, 1980). However, one may argue that cost minimization is synonymous with operational efficiency.…”

Section: Introductionmentioning

confidence: 99%

An update on economies of scale in credit unions

Kohers

Mullis

1988

Applied Economics

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Section: Introductionmentioning

confidence: 99%

An update on economies of scale in credit unions

Kohers

Mullis

1988

Applied Economics

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“…Studies dealing with this issue trace back to Taylor [ 14]. Articles dealing with the U.S. We would like to thank Doug Brown and Alvin Lo for computational assistance.…”

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confidence: 97%

Measuring returns to scale and technological change in co-operative banks: A provincial analysis of Canadian credit unions and caisses populaires

Chan

Mountain

1986

Empirical Economics

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In Canada economies of scale m credit unions come not only from large single office arrangements but from external economies realized from belonging to central provincial credit unions. Making use of aggregate provincial time series and cross-sectional data, this study begins by employing a sequential Akaike's Information Criterion (AIC) test to select the most appropriate model. This procedure permits the isolation of economies of scale from technological change effects. For all provinces, economies of scale are discovered to be significantly different from 1, and for five of the eight provinces examined, technological change was statistically significant from zero. The larger the provincial organization, as illustrated by the Quebec caisses populaires, the higher we find estimates of returns to scale and technological change. An implication may be that both expansion and more centralization should be encouraged and that other provinces may be able to increase efficiency by imitating some of Quebec's operational and administrative practices.In the last few decades, the co-operative banking movement in Canada has exemplified one of the largest rates of growth among all financial intermediaries. The membership in these co-operative institutions which are known as caisses populaires in Quebec and credit unions in the rest of Canada, has increased at the surprising rate of roughly 125% from 1967 to 1980 reaching approximately 40% of the total population. Furthermore, in terms of total assets, caisses populaires and credit unions (hereafter collectively referred to as credit unions) rank number four after the chartered banks, the trust companies and the life insurers.The rapid expansion of the credit union industry in Canada and other countries have provided the focal point of many empirical studies about returns to scale. Studies dealing with this issue trace back to Taylor [ 14]. Articles dealing with the U.S. We would like to thank Doug Brown and Alvin Lo for computational assistance.0377-7332/86/040207-222 $2.50 9 1986 Physica-Verlag, Wien, Heidelberg

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“…In contrasting the volume of work on banks with that on mutual financial services organizations, Worthington (2010, p.39-40) Early studies in this area use either ratio analysis or simple production and cost functions to assess performance. For the US see for example Taylor (1972 and1977), Wolken and Navratil (1980), Mullis (1987 and. For Australia, see Crapp (1983), Brown and O'Connor (1995) and more recently Esho (2000).…”

Section: Efficiency Studiesmentioning

confidence: 99%

Modelling the Performance of Irish Credit Unions, 2002-2010

2012

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This study undertakes a modeling based performance assessment of all Irish credit unions between 2002 and 2010, a particularly turbulent period in their history. The analysis explicitly addresses the current challenges faced by credit unions in that the modeling approach used rewards credit unions for reducing undesirable outputs (impaired loans and investments) as well as for increasing desirable outputs (loans, earning assets and members' funds) and decreasing inputs (labour expenditure, capital expenditure and fund expenses). The main findings are: credit unions are subject to increasing returns to scale; technical regression occurred in the years after 2007; there is significant scope for an improvement in efficiency through expansion of desirable outputs and contraction of undesirable outputs and inputs; and that larger credit unions, that are better capitalised and pay a higher dividend to members are more efficient than their smaller, less capitalised, and lower dividend paying counterparts.

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Economies of scale in large credit unions

Cited by 35 publications

References 6 publications

An update on economies of scale in credit unions

An update on economies of scale in credit unions

Measuring returns to scale and technological change in co-operative banks: A provincial analysis of Canadian credit unions and caisses populaires

Modelling the Performance of Irish Credit Unions, 2002-2010

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