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Does Rocky Mountain Credit Union Competition still Affect Commercial Bank Interest Rates?

Author

Listed:
  • Thomas M. Fullerton

    (Department of Economics & Finance, University of Texas at El Paso, El Paso, USA)

  • Robert J. Tokle

    (Department of Economics, Idaho State University, Pocatello, USA)

  • Bryce Jones

    (Colorado Office of Economic Development & International Trade, Denver, USA)

  • Steven L. Fullerton

    (Border Region Modeling Project, University of Texas at El Paso, El Paso, USA)

Abstract

Historically, increased credit union competition in Idaho and Montana has caused commercial banks to offer higher deposit rates to savers and lower loan rates to borrowers. Data are collected for the second quarter of 2018 to examine whether that pattern still holds true. Unlike prior studies, empirical results indicate that credit union competition no longer exerts statistically reliable impacts on deposit rates or loan rates in this northern Rocky Mountain region of the United States. Potential contributing factors include bank and thrift consolidation in recent years, the low interest rate environment prevailing during the late 2010s, and greater emphasis on non-interest forms of intermediary competition in the banking markets that comprise this regional economy.

Suggested Citation

  • Thomas M. Fullerton & Robert J. Tokle & Bryce Jones & Steven L. Fullerton, 2023. "Does Rocky Mountain Credit Union Competition still Affect Commercial Bank Interest Rates?," Journal of Regional Economics, Anser Press, vol. 2(1), pages 42-52, September.
    • Handle: RePEc:bba:j00009:v:2:y:2023:i:1:p:42-52:d:209
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    References listed on IDEAS

    as
    1. Robert M. Feinberg, 2001. "The Competitive Role Of Credit Unions In Small Local Financial Services Markets," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 560-563, August.
    2. Robert M. Feinberg & A.F.M. Ataur Rahman, 2006. "Are Credit Unions Just Small Banks? Determinants of Loan Rates in Local Consumer Lending Markets," Eastern Economic Journal, Eastern Economic Association, vol. 32(4), pages 647-659, Fall.
    3. Timothy H. Hannan, 2003. "The impact of credit unions on the rates offered for retail deposits by banks and thrift institutions," Finance and Economics Discussion Series 2003-06, Board of Governors of the Federal Reserve System (U.S.).
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    Cited by:

    1. Robert M. Feinberg, 2025. "Local Credit Union Competition and Bank Deposit Rates: The Role of Covid-19," Journal of Industry, Competition and Trade, Springer, vol. 25(1), pages 1-11, December.
    2. Robert M. Feinberg & Kara M. Reynolds, 2026. "The impact of credit union competition on Bank loan rates, 2010–2019," Southern Economic Journal, John Wiley & Sons, vol. 92(3), pages 705-715, January.

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