Marco Ercole Oriani

Are Cooperative Banks a Lever for Promoting Bank Stability? Evidence from the Recent Financial Crisis in OECD Countries

Based on a sample of cooperative, savings, and commercial banks from OECD countries, this paper examines whether and to what extent cooperative banks affected average bank soundness during 2001–2010. To account for the impact of the recent financial crisis, we analyse separately the pre�?crisis period (2001–2006) and crisis years (2007–2010). Unlike published claims that blame the fragility of banking systems on the presence of non–profit�?maximising entities, our main finding is that cooperative banks have explanatory power for stabilisation during the crisis years, but only above a certain market share threshold.

On the relationship between bank business models and financial stability. Evidence from the financial crisis in OECD countries

The cooperative credit sector represents an essential sector of the banking structure of many financial systems, especially in Europe where, in Austria, Finland, France, Germany, Italy and the Netherlands, the cooperative banks have a high market share (see Figure 1.1). In advanced economies and emerging markets outside Europe, cooperative banks generally have a lower share, but there are some countries where they play a non-negligible role, as in Japan and Canada, where in 2010 the share of the cooperatives was 15.72 per cent and 3.49 per cent, respectively.