Economies of Scale and Economies of Scope in Multiproduct Financial Institutions: Further Evidence from Credit Unions

1986 ◽  
Vol 18 (2) ◽  
pp. 220 ◽  
Author(s):  
H. Youn Kim
Keyword(s):  
Financial Institutions ◽  
Economies Of Scale ◽  
Credit Unions ◽  
Economies Of Scope

Credit unions’ acquisitions of banks and thrifts

2019 ◽  
Vol 11 (3) ◽  
pp. 306-318
Author(s):  
David A. Walker ◽  
Kathryn I. Smith
Keyword(s):  
Capital Structure ◽  
Design Methodology ◽  
Economies Of Scale ◽  
Financial Analysis ◽  
Credit Unions ◽  
Credit Union ◽  
Social Implications ◽  
Economies Of Scope ◽  
Content Type ◽  
Practical Implications

Purpose In total, 14 credit unions have acquired 16 banks and savings institutions since 2012; 7 additional acquisitions are in progress and are expected to close before year-end 2019. The analysis of the population of these acquisitions spans the paths of annual differences in CAMEL ratios. Most acquirers have a somewhat revised capital structure and are often benefiting from economies of scope, as well as economies of scale. Since their acquisitions, the acquiring credit unions have become less risky, measured by simulated CAMEL ratios, and they are lending a larger share of their deposits. There is no apparent financial reason to discourage credit unions from acquiring additional banks and savings institutions. The National Credit Union Administration does not need to be particularly hesitant to allow credit unions to acquire banks and thrifts. Design/methodology/approach Financial analysis is done via simulated CAMEL ratios. Findings After acquiring banks, credit unions are less risky and lend a greater share of their deposits. Research limitations/implications The study analyzes the population of the credit unions that have acquired banks since 2012, but the population consists of 14 banks acquiring 16 credit unions. Practical implications Credit unions should not be prohibited from further acquisitions of banks and thrifts. Social implications Credit union members are better served after a credit union acquires a bank. Originality/value No previous study has explored the effects of credit unions acquiring banks and thrifts, which began in 2012.

scholarly journals Économies d’échelle dans les opérations des caisses populaires du district de Québec

2009 ◽  
Vol 53 (1) ◽  
pp. 23-43
Author(s):  
Nabil T. Khoury
Keyword(s):  
Financial Institutions ◽  
Economies Of Scale ◽  
Empirical Studies ◽  
Credit Unions ◽  
Financial Intermediaries ◽  
Empirical Results ◽  
Technological Transition

Abstract The application of the computer to the servicing of deposit accounts at banks and non-bank financial intermediaries is a fairly recent development. Most empirical studies of economies of scale in this industry date prior to this technological transition. There is one notable exception, however, and that is the study by D. L. Daniel, W. A. Longbrake and N. B. Murphy (1972), in which they reported economies of scale in the servicing of checking deposits for computerized banks, especially when the number of such accounts exceeds the 10,600 mark. The present study examines the issue for a different type of computer-using deposit institution, namely: a sample of 128 Canadian Credit Unions located in the district of Quebec and referred to as the "Caisses Populaires" (C.P.'s). These institutions were chosen for the study because they present some unique characteristics and also because they were among the first Canadian financial institutions to computerize the servicing of their deposit operations. Following G. J. Benston (1970) and F. Bell and N. Murphy (1968), the data has been tested using two different models. The empirical results of both tests indicate that computerization did not generate any economies of scale in the checking deposit accounts. Further analysis reveals that the potential economies of scale were captured by the lessor of the equipment through a financial arrangement tying the rent to the number of cheking accounts to be serviced.

scholarly journals The Efficiency of Non-Bank Financial Intermediaries: Empirical Evidence from Malaysia

2008 ◽  
Author(s):  
Fadzlan Sufian
Keyword(s):  
Risk Factors ◽  
Data Envelopment Analysis ◽  
Empirical Evidence ◽  
Financial Institutions ◽  
Economies Of Scale ◽  
Financial Intermediaries ◽  
Scale Efficiency ◽  
Data Envelopment ◽  
Parametric Data ◽  
Dea Method

This paper investigates the performance of Malaysian non-bank financial institutions during the period of 2000-2004. Several efficiency estimates of individual NBFIs are evaluated using the non-parametric Data Envelopment Analysis (DEA) method. The findings suggest that during the period of study, scale inefficiency outweighs pure technical inefficiency in the Malaysian NBFI sector. We find that the merchant banks have exhibited a higher, technical efficiency compared to their peers. The empirical findings suggest that scale efficiency tends to be more sensitive to the exclusion of risk factors, implying that potential economies of scale may be overestimated when risk factors are excluded.  

scholarly journals A Cross-Section Analysis of Intra-Industry Trade in the U.S. Processed Food and Beverage Sectors

1993 ◽  
Vol 22 (2) ◽  
pp. 189-198 ◽  
Author(s):  
Darcy A. Hartman ◽  
Dennis R. Henderson ◽  
Ian M. Sheldon
Keyword(s):  
Product Differentiation ◽  
Imperfect Competition ◽  
Economies Of Scale ◽  
Economies Of Scope ◽  
Processed Food ◽  
Industry Trade ◽  
Manufacturing Sectors ◽  
Food And Beverage ◽  
Trade Partners ◽  
Section Analysis

This paper analyzes the determinants of variation across industries in levels of intra-industry trade (IIT) for a sample of thirty-six U.S. processed food and beverage industries in 1987, previous studies of intra-industry trade having focussed on industry characteristics in the manufacturing sectors. The determinants predicted by IIT theory are measures of product differentiation, economies of scale, and imperfect competition; the results of this analysis indicate that IIT variation across the food and beverage industries is positively related to product differentiation, economies of scope, and similarity of tariff barriers among trade partners, but negatively related to industry concentration.

INCOME FROM VINEYARD FARMS ACCORDING TO ECONOMIC SIZE IN SELECTED EUROPEAN UNION COUNTRIES

2019 ◽  
Vol XXI (3) ◽  
pp. 277-286
Author(s):  
Mariusz Maciejczak ◽  
Tadeusz Filipiak ◽  
Massimo Gardinam
Keyword(s):  
European Union ◽  
Economies Of Scale ◽  
Family Income ◽  
Economies Of Scope ◽  
Farm Income ◽  
The European Union ◽  
Wine Production ◽  
Eu Countries ◽  
Wine Sector ◽  
Economic Size

The wine sector is of great importance for many national economies of EU countries. The European Union is a world leader in area under grape cultivation and wine production. The goal of the paper was to determine the profitability of farms specializing in winegrape production depending on economic size in selected EU countries in the years 2004-2016. In addition, the level of farm income per 1 ha of viticulture was determined, as well as the level of family income and the share of total subsidies in total income. Overall, it was found that there was an increase in income, however income increased along with economic size. In the examined period, growth was only observed from the fourth economic class (EUR 50-100 thousand). Additionally, the share of income subsidies under CAP decreased along with economic size. The conducted research gave light to information that could prove vital to adapt the European vineyard and wine sector to the opportunities and needs of the market, namely by taking into account the links between economies of scale and economies of scope.

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