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Detecting abnormal credit union performance

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  • Bauer, Keldon

Abstract

Credit unions are an important financial intermediary, but little credit union research is done. A primary reason for the lack of research is the cooperative nature of the industry, making traditional methods of detecting abnormal performance inappropriate. This paper proposes two methods of detecting abnormal performance, one parametric, the other non-parametric. Instead of testing the efficiency of the institution, this paper proposes testing the return vector, as indicated in the theoretical objective function of the member. Simulations demonstrate that both methods are correctly specified and powerful.

Suggested Citation

  • Bauer, Keldon, 2008. "Detecting abnormal credit union performance," Journal of Banking & Finance, Elsevier, vol. 32(4), pages 573-586, April.
    • Handle: RePEc:eee:jbfina:v:32:y:2008:i:4:p:573-586
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    References listed on IDEAS

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