Financial performance of credit unions in the Czech Republic
|Author:||Mgr. Matěj Kuc|
|Year:||2014 - summer|
|Leaders:|| prof. PhDr. Petr Teplý Ph.D.
|Work type:|| Economic Theory
|Awards and prizes:|
|Abstract:||This thesis is interested in relative performance of highly criticized Czech credit unions.Theoretical
part comments on their historical development, makes international comparison and shows possible development of legislation. We created two unique datasets to assess
financial performance of Czech credit unions
in subsequent empirical part. The first one
contains Czech credit unions’and commercial banks’ data.
The second one is established to make a comparison
of Czech credit unions with cooperative banks
operating elsewhere in the EU. Both are based on annual data between 2007 and 2012 period. System GMM method is
employed as main instrument of our empirical analysis and
alternative panel data methods are used as supplementary techniques. We focused our analysis on comparison
of relative profitability and stability measures of Czech credit unions. The results revealed their poor performance in the
given time period. According to our estimates, they resembled rather small commercial banks than cooperative ones. The negative rela tionship between Czech credit unions’
stability measure (Z - score) and their asset size is especially striking. Moreover, Z - score of Czech credit unions decreased sharply in 2012. Such development was observed neither in case of Czech commercial banks nor i
n other European cooperative banks.