Brazilian credit union member groups: Borrower-dominated, saver-dominated or neutral behavior?

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Valéria Gama Fully Bressan
Marcelo José Braga
Moisés de Andrade Resende Filho
Aureliano Angel Bressan


Theoretical models concerning Credit Unions (CUs) suggest that the type of CU domination determines the way it allocates the monetary value it generates. A borrower- (saver-) dominated CU benefits borrower (saver) members at the expenses of saver (borrower) members, and a neutral CU equally benefits its member groups. This paper applies direct measure of monetary benefits to each member group (Patin & McNiel, 1991a) to test for the existence of dominated behavior in Brazilian CUs, and is the first to apply panel data regressions to identify the determinants of CUs behavior. We use a unique panel data with 40,664 observations taken from 533 CUs affiliated with the largest Brazilian cooperative network. Results indicate Brazilian CUs are dominated by borrowers, but behave close to neutrality. Panel regression estimates show that common or multiple bond type, size and overdue loans of a CU have no effect on its behavior, the greater the total amount of loans over social capital and adjusted equity over total assets are the more likely a CU is borrower dominated, and the greater the age and current operational expenses over total asset of a CU are the more likely a CU is saver dominated.


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Bressan, V. G. F., Braga, M. J., Resende Filho, M. de A., & Bressan, A. A. (2012). Brazilian credit union member groups: Borrower-dominated, saver-dominated or neutral behavior?. Brazilian Administration Review, 10(1), 40-56.