Performance Comparison of Cooperative Banks in the EU, USA and Canada
Authors: Matej Kuc
This paper compares different types of profitability measures of cooperative banks from two developed regions: the European Union and the United States of America together with Canada. We created balanced dataset of more than 200 cooperative banks covering 2011-2016 period. We made series of tests and run Random Effects estimation on panel data. We found that American and Canadian cooperatives are more profitable in terms of return on assets (ROA) and return on equity (ROE). There is no significant difference in net interest margin (NIM). Our results show that the North American cooperative banks accommodated better to the current market environment.
Digital Object Identifier (DOI): doi.org/10.5281/zenodo.3566287Procedia APA BibTeX Chicago EndNote Harvard JSON MLA RIS XML ISO 690 PDF Downloads 190
 T. W. Guinane, “Cooperatives as Information Machines: German Rural Credit Cooperatives, 1883-1914”, The Journal of Economic History, Volume 61, Issue 2, pp. 366-389, June 2001.
 R. Ayadi et al., “Investigating Diversity in the Banking Sector in Europe: Key Developments, Performance and Role of Cooperative Banks,” Centre for European Policy Studies, Brussels, 2010.
 E. Liikanen et al. “High-level Expert Group on reforming the structure of the EU banking sector”, European Commission, Brussels, 2012.
 E. Castelló, C. Trias, A. Arribas, “ Europe’s cooperative banking models (Revised edition)”, European Economic and Social Committee, Brussel, 2018.
 “World Council of Credit Unions 2017 Statistical Report”, World Council of Credit Unions, Washington D.C., November 2018.
 J. Schildbach, “Bank performance in the US and Europe - An ocean apart”, Deutsche BankAG, DB Research, Frankfurt am Main, September 2013.
 M. Matejašák, P. Teplý, J. Černohorský, “The impact of regulation of banks in the US and the EU -15 countries“, Ekonomie a Management (Economics and Management). Issue 3, pp. 58-68, 2019.
 E. Posner, N. Véron, “The EU and financial regulation: power without purpose?”, Journal of European Public Policy, Volume 17, 2010 - Issue 3: Europe and the Management of Globalization, March 2010.
 C. L. Buch, S. M. Golder, “Foreign versus domestic banks in Germany and the US: a tale of two markets?”, Journal of Multinational Financial Management, Volume 11, Issues 4–5, pp. 341-361, December 2001.
 S. Hoffmann, P. Rodrigo, “Determinants of the Profitability of the US Banking Industry”, Repositorio de la Universidad Pontificia Comillas, 2015.
 D. K. Chronopoulos, H. Liu, F. J. McMillan, J. O. S. Willson, “The dynamics of US bank profitability”, The European Journal of Finance, Volume 21, 2015 - Issue 5, pp. 426-443, September 2013.
 M. Kuc, P. Teplý, “A Financial Performance Comparison of Czech Credit Unions and European Cooperative Banks”, Prague Economic Papers, University of Economics, Prague, vol. 2018(6), pp. 723-742, 2018.
 R. Beckmann, “Profitability of Western European Banking Systems: Panel Evidence on Structural and Cyclical Determinants”, Deutsche Bundesbank. Discussion Paper No. 2007/17, 2007.
 G. Iannotta et al., “Ownership Structure, Risk and Performance in the European Banking Industry”, Journal of Banking and Finance, 31(7), pp. 2127–2149, 2006.
 H. Hesse and M. Čihák, “Cooperative Banks and Financial Stability,” IMF WP, no. 07/02, Washington D.C.: IMF, 2007.
 B. R. Moulton, “Random Group Effects and the Precision of Regression Estimates,” Journal of Econometrics, vol. 32, no. 3, pp. 385-397, 1986.