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Operating Performance Evaluation Based on Z-score Model and Profitability between Cross-Straits Credit Cooperatives

Author

Listed:
  • Kuei-Chiu Lee

    (College of Business, Feng Chia University, TAIWAN)

  • Wun-Hong Su

    (Business School, Shantou University, CHINA)

  • Chien-Yen Liu

    (College of Business, Feng Chia University, TAIWAN)

Abstract

This paper extends the literature evaluating credit cooperatives practices for two sides of Taiwan Strait. It finds evidence of different regulations and systems between cross-straits credit cooperatives resulting in the different profitability. The profitability is significantly and positively related with ratio of loan to deposit and with the capital structure, but is negatively associated with loan growth rate for Chinese rural credit cooperatives. The higher total asset turnover and ratio of loan to deposit lead to the better profitability and operating performance while the increasing operating expense ratio decreases with the profitability for Taiwanese credit cooperatives.

Suggested Citation

  • Kuei-Chiu Lee & Wun-Hong Su & Chien-Yen Liu, 2017. "Operating Performance Evaluation Based on Z-score Model and Profitability between Cross-Straits Credit Cooperatives," Review of Economics & Finance, Better Advances Press, Canada, vol. 10, pages 72-82, November.
    • Handle: RePEc:bap:journl:170406
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    References listed on IDEAS

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    More about this item

    Keywords

    Credit cooperatives; Z-score model; Profitability; Return on assets; Return on sales;
    All these keywords.

    JEL classification:

    • G00 - Financial Economics - - General - - - General
    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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