Wpływ konkurencji ze strony spółdzielczych kas oszczędnościowo-kredytowych na stabilność banków spółdzielczych. Analiza rynków lokalnych

Łukasz Kozłowski

Published : 2023-11-21

Vol. 61 No. 4 (2015)

The impact of credit union cempetition on cooperative bank stability. An analysis of local markets

Łukasz Kozłowski

Abstract

In the research article I analyze the effects of competition from Polish credit unions on the stability of cooperative banks. I make use of the addresses of all bank and credit union outlets in order to accurately reflect competitors’ strength in local markets. The results prove that credit unions, which until recently stayed outside the official financial supervision, constituted unwanted competition from the perspective of the banking system stability. Cooperative banks that faced the strongest competition from credit unions generated significantly higher loan loss provisions. This result should be related to a comparatively loose credit policy of those banks, and – in turn – taking higher credit risk negatively impacts the stability of these banks. Unwanted competition effects were also observed at the level of the cooperative banks’ net interest margin and their profitability. On the other hand, the results do not confirm a comparable negative influence of competition from other banks.

Keywords:

competition, cooperative banks, credit unions, stability

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Kozłowski, Łukasz. (2023). The impact of credit union cempetition on cooperative bank stability. An analysis of local markets. Safe Bank, 61(4), 180–199. Retrieved from https://ojs.bfg.pl/index.php/bb/article/view/322

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