Mutual Savings Research Articles

Performance Evaluation of Co-operative Banks in India with Special References to Delhi NCR

In this paper we have considered some parameter tools, Data Analysis, Data Collection Method and introductory part regarding Assessing the Effectiveness of India's Cooperative Banks with Special References to Delhi NCR. In India, co-operative banks play a crucial role since they were set up to provide the country's rural population with banking services. The goal of its founding was to provide access to financial services and stimulate growth in rural areas. They're crucial to India's progress economically and socially. To better understand the challenges encountered by co-operative banks and provide solutions to help them thrive, this research examined their organizational framework, development, and performance. The information comes from several SCB, DCCB, and PACS yearly reports. Percentages, percentage changes, coefficients of variation, compound annual growth rates, and graphs have all been employed in the statistical analysis of the data. The research will be useful to policymakers as they seek to boost the efficiency of Co-operative banks. Some metrics, including as the number of branches, sum deposited, employee output, and location, proportion of late to demand, nonperforming assets, and profits, have been studied to assess the efficiency of Co-operative banks. The data reveals that PACS, in particular, are losing money owing to large overdoes, an increase in nonperforming assets (NPA), and low output per employee and location. Mutual savings banks confront a number of challenges, but they may be overcome with the right actions (such as a focus on recovery, training for employees to boost efficiency, and government backing).

Embracing Market Liberalism? Community Structure, Embeddedness, and Mutual Savings and Loan Conversions to Stock Corporations

Integrating research on communities with economic and organizational sociology, we analyze how organizations’ responses to marketization are shaped by their embeddedness in communities and the socio-associational structure of those communities. We address these relations via event-history analyses of mutual conversions to stock corporations among savings and loan associations (SLAs) in the United States, a population of depositor-owned and traditionally community-based banks that demutualized amid deregulation during the 1970s and 1980s. Consistent with accounts of social disorganization and declining social capital, SLA managers abandoned mutual for corporate enterprise as SLAs became less locally embedded, and where communities experienced disorganization and declining working- or cross-class associationalism. Yet conversions also depended on elite detachment, civic reorganization, bifurcation within communities, and “upwardly oriented” associations that helped SLA managers reorient SLAs from Main Street to Wall Street. Through this study, we look beyond networks, institutions, and categories to add communities and local associations to economic sociology’s toolkit for understanding the social foundations of firms and markets. We show how financialization coupled macro-level political-institutional dynamics of marketization with community-level dynamics of elite disconnection, class and ethno-racial fracture, and civic reorganization, while also shedding light on the contemporary fates of mutual and cooperative forms.

Accounting transparencies and audit fees of auditor-designated mutual savings banks in Korea

In 1998, the act on mutual savings banks was amended to create a legal basis for auditor designation for certain mutual savings banks in Korea. Also, a series of restructuring processes for the savings banking industry took place in 2011 due to the insolvency of some savings banks. This study empirically analyzes whether the auditor designation rule has affected how mutual savings banks set aside allowance for bad debts and thus help improve their accounting transparency (better asset quality and less earnings management), as well as the impact of this rule on audit fees. It also looks into whether there is any notable difference in accounting transparency and audit fees between before and after the savings bank incident in 2011. We specifically set the six hypotheses about the effect of auditor designation on asset quality, earnings management, and audit fees, and the different effect of savings bank incident on these three factors. We investigate the hypotheses using regression models with 809 firm-year sample from 2005 to 2014. The results show that asset quality has improved for auditor designated mutual savings banks and after the incident. With respect to earnings management, mutual savings banks with designated auditors are found to be less likely to manage their earnings using allowance for bad debts, but there is no statistical significance in difference between before and after the savings bank incident. As for audit fees, the amount of fees is large for auditor-designated mutual savings banks, and after the incident. This study would offer useful insights to financial regulators, auditors, audit clients, and other stakeholders.

BIS Ratio as Financially Sound Index for Mutual Savings Banks

BIS Ratio as Financially Sound Index for Mutual Savings Banks

금융위기 시 예금자 우선변제제도의 역할에 관한 연구: 한국의 부실저축은행 구조조정을 중심으로(The Financial Crisis and a Deposit Preference: Focusing on Resolution of the Insolvent Mutual Saving Banks in Korea)

Korean Abstract: 본 연구는 금융회사 파산 시 예금자가 다른 일반채권자보다 우선하여 파산재단으로부 터 예금채권을 변제받을 수 있도록 하는 예금자 우선변제제도가 예금보험제도와 상호보 완적인 역할을 담당하여 궁극적으로 금융시스템 안정에 기여할 수 있음을 인식하고, 예 금자 우선변제제도의 예금보험기금 절감효과를 살펴봄으로써 동제도 도입의 필요성을 제언하고자 하였다. 본 연구에서는 2011년~2015년 부실저축은행 정리에 투입된 금액과 예금자 우선변제 제도를 적용한다고 가정할 경우의 정리비용을 비교함으로써 예금보험기금의 절감효과를 확인하였다. 분석 결과, 첫째, 보험금 지급 후 청ㆍ파산 방식 하에서 예금자 우선변제권 은 예금보험기구의 파산배당률을 높여 회수금액의 극대화를 통해 약 1.4조원의 정리비용 을 절감할 수 있음을 확인하였다. 둘째, 제3자(또는 가교금융회사) 계약이전 방식으로 부실저축은행 정리 시, 예금이 부분보호되고 예금자 우선변제가 있는 경우, 약 3.9조원의 예금보험기금 절감효과를 확인하였다. English Abstract: This study analyzes the reduction effects of the deposit insurance fund in the depositor preference system. In addition, this study examines the importance of the depositor preference system, which allows depositors to repay deposits from bankruptcy in preference to other general creditors in case of bankruptcy. Depositor preference plays a complementary role with deposit insurance and ultimately contributes to the stability of the financial system. In this study, we examined the savings of the Deposit Insurance Fund by comparing the amount of money spent on the resolution of insolvent mutual savings banks from 2011 to 2015 in Korea as well as the reconciliation cost in the case of applying the Depositor Preference. Results found the depositor preference system under the bankruptcy method can increase the bankruptcy dividend rate of the deposit insurance organization, thereby reducing the resolution cost of about KRW 1.4 trillion by maximizing the amount recovered. Second, when arranging insolvent mutual savings banks by the transfer of third party (or bridging financial company) contracts, we found the savings of the deposit insurance fund of approximately KRW 3.9 trillion when the deposits were partially protected and with the depositor preference.

시나리오 분석을 활용한 예금보험기금 상호저축은행 구조조정 특별계정의 부채 추정에 관한 연구(A Study on Debt Estimation of Mutual Savings Bank Restructuring Special Accounts of Deposit Insurance Fund Using a Scenario Analysis)

Korean Abstract: 상호저축은행 구조조정 특별계정은 2011년 1월 이후 발생한 상호저축은행의 부실을 정리하기 위해 예금보험기금 내 별도로 설치되어 2026년말까지 한시적으로 운영되는 예금보험기금의 일부 계정이다. 동계정은 그동안 31개 저축은행의 부실을 정리하는 데 크게 기여하였지만, 상환기일인 2026년말까지 막대한 규모의 부채가 기금의 안정성과 건전성에 적지 않은 영향을 미칠 것으로 예상되는 바, 현재와 같이 저축은행의 구조조정이 일단락된 시점에 부채 규모를 적절히 추정하고 그 상환대책을 마련하는 것이 무엇보다도 중요하다. 본 논문은 시나리오 분석을 활용하여 특별계정 부채를 추정하고 예금보험기금의 건전성을 제고하기 위한 상환대책을 제언하고자 하였다. 2018년말 기준 특별계정 부채 잔액 약 21.3조원에 대해 운영기한인 2026년말까지 특별계정 수입으로 부채 잔액을 추정한 결과, 현재의 특별계정 수입만으로 적립된 부채를 상환하기에는 어려운 것으로 파악되었다. 향후 보험료수입의 대폭 증가가 힘든 상황을 고려하면 회수자금 극대화 노력이 매우 주효함을 시사하는 결과라 할 수 있다. 본 연구에서는 상환기한의 연장을 가장 현실적인 대안으로 제언하고, 장기적으로는 공동계정의 설치 또는 유사계정간 통합 등 기금 체계의 개편과 자본조달수단의 다양화 등을 적극 검토할 필요가 있음을 제언한다. English Abstract: Restructuring special accounts of mutual savings banks is part of the Deposit Insurance Fund (DIF) operated temporally until the end of 2026. The purpose of this change in the DIF is to reorganize the insolvent mutual savings banks that occurred after January, 2011. These accounts have greatly weakened 31 savings banks. But because massive debt considerably affects the safety and soundness of the fund until the end of 2026, the due date of repayment, it is vital that when savings bank restructuring is completed, the amount of liabilities is appropriately estimated and repayment policy is prepared. This paper suggests a repayment policy for estimating special account debts and enhancing the stability of DIF using a scenario analysis. As a result of approximating the debt balance of approximately 21.3 trillion won (with special account income until the end of 2026) as of the end of 2018, it is clear that it will be difficult to service the debt with only the present special account income. Given that a massive increase in additional income is unlikely, it could be said that maximizing public fund recovery is extremely important. This study suggests the extension of the repayment schedule as the most realistic alternative, and suggests that it is necessary to actively review the DIF system, including the establishment of joint accounts of integration between similar accounts, and diversification of fund-raising opportunities.

Financial Liberalization and Regulatory Changes in Korea

1. Introduction 2. Proliferation of NBFIs: A Precursor to the 1997 Financial Crisis 3. Role of NBFIs in the 1997 Financial Crisis 4. Financial Supervision: Before and After the Crisis 4.1 Credit Card Crisis: Haphazard Deregulation and Weak Financial Supervision 4.2 Mutual Savings Bank Crisis in 2011: A Replay of Previous Crises 5. Financial Development and Inadequate Financial Supervision

Observations on the Life Insurance Policyholders Protection Corporation of Japan

Observations on the Life Insurance Policyholders Protection Corporation of Japan

ПЕРЕДУМОВИ ТА ПЕРСПЕКТИВИ РОЗВИТКУ БАНКІВ ВАРТОСТІ


 
 
 The state of the modern financial market is not homogeneous. Various organizations act on it, such as world, investment, public, retail, social, church, green, folk and development banks; official and unofficial banking organizations; shadow financial system. Mutual assistance banks, rural banks, credit unions, savings and loan funds are institutions formed on the basis of mutual assistance among people. There are also banks operating in the «western» financial tradition and those operating under the laws of Sharia. Value banks are social, ethical, green and public banks without a definite management model that function in the form of joint stock companies, unions and private enterprises. In the article, the ways of formation, organizational structures, historical and religious preconditions of creation and modern tendencies of development of value banks are viewed.
 
 

Offsite Detection of Insider Abuse and Bank Fraud among U.S. Failed Banks 1989-2015

We find evidence that material insider abuse and internal fraud were present in approximately 457 (37 percent) of the 1,237 U.S. failed commercial and mutual savings banks (hereafter, banks) between 1989 and 2015. Using a unique dataset of the incidence of insider abuse and internal fraud among U.S. failed banks we analyze the characteristics of failed banks with the ultimate goal of developing fraud detection models — parametric (logistic regression, Benford digit analysis) and non-parametric (neural networks). We obtain information on the incidence of insider abuse and internal fraud among failed banks from failing bank cases prepared for the FDIC Board of Directors, restitution orders (fines) supervisors assessed for bank employee fraud, and bond claims the FDIC made to recover fraud-related losses on failed banks. The supervisory data we use to quantify fraud among failed banks has not been used previously in published research and, we feel, provides more comprehensive information on fraud among failed banks than that available to academic researchers. Since fraudulent behavior lies outside the realm of rationale behavior modelled in economics, we develop a framework for internal bank fraud that provides rationale and support for our fraud detection models. This framework is based on previous studies of financial fraud and internal bank fraud in particular. We test this framework using regression analysis of the determinants of fraudulent behavior among failed banks between 1989 and 2015 and find that banks with insider abuse and fraud present overstated income and asset values, under-reported losses and consequently overstated net worth. The regression models of fraudulent failed banks provide information on the financial statement line items that can be used to identify fraud. We next use a recently developed second-order Benford digit test to identify those banks whose financial statements suggest tampering and purposeful misstatement. Our results suggest that material insider abuse and fraud at banks is detectable using Benford digit analysis of bank financial data for a period one-to-four years prior to failure. Unfortunately, we are unable to develop an accurate neural network model for fraud prediction.

금융기관 지배구조와 이익조정-저축은행의 내부감사기능을 중심으로

금융기관 지배구조와 이익조정-저축은행의 내부감사기능을 중심으로

상호저축은행의 회계에 관한 연구

상호저축은행의 회계에 관한 연구

(Expected Probability of Default Model for Mutual Savings Banks Combining Financial Data and Stock Prices)

Korean Abstract: 부실예측시 과거의 재무제표를 이용한 로지스틱 회귀모형 또는 주가를 이용한 옵션모형이 많이 사용되나 자료의 제약으로 모형의 유용성이 제약된다. 특히 국내의 경우 부도시점이 IMF사태 직후로 편중되어 부실예측모형의 모수 추정시 어려움이 존재한다. 본 논문은 이에 대한 대안으로 기존의 두 모형이 모두 부도확률을 제공한다는 점에 착안하여, 먼저 상장된 상호저축은행의 주가자료를 이용하여 해당은행의 부도확률을 옵션모형을 이용하여 주기적으로 구한 후, 재무자료의 주기에 맞게 단순(가중)평균값을 구함으로써 관측오차를 줄여줌과 동시에 재무건전성을 신속히 반영하는 부도확률을 구할 수 있었다. 결합모형을 실제 자료에 적용한 결과, CAMEL 관련 변수 중에서 자본적정성(C)과 자산건전성(A)관련 변수가 부도를 예측하는 유용한 변수일뿐더러, 추정시기가 변함에 따라 선택되는 설명변수는 변함이 없어 부도를 예측하는 조기경보시스템을 구축함에 매우 유용함을 알 수 있고, 실제 도산한 저축은행에 적용한 실증분석에서도 효과적임을 알 수 있었다. English Abstract: The logistic regression model based on the historical finance data and option model based on the stock prices are used as probability of default(PD) models for the mutual savings banks, but there are some problems on the usefulness of model and accessibility of data. As an alternative, we propose a new methodology combining both models: the option model provides PDs for the exchang-traded S&L banks, which is used as a dependent variable in the logistic model, and multivariate regression with the corresponding S&L bank's financial data are used. The empirical results show that 1) variables of Capital adequacy and Asset quality in CAMEL index are of significance, 2) selection of these variable are consistent, although the estimation period changes, hence, this method will be very effective for the implementation of early-warning model, 3) it is very effective for the forecast of default in case of real defaulted S&L banks.

(Default Prediction of Mutual Savings Bank by Using a Survival Analysis)

Korean Abstract: 본 논문에서는 부실예측연구를 금융기관인 상호저축은행으로 확장하여 2001년 6월말부터 최근까지의 도산 집단과 생존 집단을 표본으로 현행 CAMEL 지표 및 특성을 반영하여 도산 예측 모형을 추정하였다. 특히 기존의 이분류 예측 모형의 한계를 보완할 수 있는 생존분석 기법을 응용하여 비례위험 모형을 도산예측에 이용하였다. 비례위험 모형을 이용하여 개별기업의 위험함수를 추정한 결과는 손실위험도가중여신비율을 제외하면 모두 예상 부호와 일치하는 결과를 보였다. 각 변수의 민감도 분석을 실시한 결과 총 자산이익률의 1% 증가는 도산 위험률을 약 0.68배 감소시키며, 자기자본대영업수익의 1% 증가는 도산 위험률을 약 0.97배, BIS기준기본자본비율의 1% 증가는 도산 위험률을 약 0.91배 감소시키는 것으로 나타났다. 비례위험 모형은 이와 같이 개별 공변량들의 민감도 분석에 매우 용이하다. English Abstract: This paper examines the significance of the variables which are used in predicting the defaults of saving institutions. Cox’s proportional hazard model, considered to be a complementary method to the dichotomous classification, has been used in making the predictions. The results for all the variables, except the loss weighted asset ratio, were shown to be consistent with the expected results. It was revealed that a 1% increase in the return on assets reduces the default ratio 0.68 times, a 1% increase in the operating income to equity capital reduces the default ratio 0.97 times and a 1% increase in the BIS capital ratio reduces the default ratio by 0.91 times.

The Effects of Corporate Governance System of Financial Institutions on Earnings Management －Focus on Mutual Savings Bank’s Ownership Structure－

The Effects of Corporate Governance System of Financial Institutions on Earnings Management －Focus on Mutual Savings Bank’s Ownership Structure－

Philanthropy and the Third Sector in Korea: Overview, Extent, Activities, and Impacts

This is a part of a major work undertaken by the Asia Pacific Philanthropy Information Network (APPIN. This segment on Indonesia is divided into two sections. The first section provides an overview of philanthropy (including zakat and sadaqa), the third sector (including waqf or Muslim foundation), historical growth, policy environment, and the laws related to incorporation and tax treatment of the third sector. The second section provides an overview of an activity-based classification, identifying various fields internationally where non-profit organizations are active. The Johns Hopkins Comparative Nonprofit Sector Project developed the International Classification of Non-Profit Organisations or ICNPO. We used this classification to explore the variety of third sector activity in each country, but we extended the ICNPO to include trading co-operatives. Traditionally, philanthropy in Indonesia has been spontaneous and un-planned occurring within the family or neighborhood. Different community or occupational groups used to have their own informal bodies like Subak in Bali organised to ensure sustainability of water supply from common-pool resources. There also have been organized philanthropic activities in a hamlet or a village for protecting and creating public goods. There also have been self-reliant community organizations (LSMs) working to improve social and economic conditions as well as the welfare of local communities through community participation. Most importantly 500,000 or so arisan groups participated by housewives, employees, or young men for mutual savings, called pre-cooperatives, facilitate significant amount of savings to meet many financial needs of the members. Besides the above philanthropic activities, religion-based philanthropy is also practiced in Indonesia. For example, Muslims (85% of the population in Indonesia) provide zakat ul mal, zakat ul fitr, sadaqa, etc in charity. There are 623,829 mosques; 41,874 Protestant churches; 12,406 Catholic churches, 68,861 Hindu temples; and 7,424 Buddhist monasteries available for religious practices and educations in Indonesia (as of 2000). These organizations collect funds, build religious facilities, provide religious educations, and promote religious ethics and morale values. The re-emergence of democracy in 1998 resulted in many changes in the government’s policy and strategies. The Ministry of Justice and Human Rights issued a new law on foundation in August 2002. The newly created NGOs (mostly as foundations) are demanding and undertaking stronger roles in the on going political and democratic reform activities. Thus the identity of the Indonesian NGOs is being established as civil society organizations fighting for democracy. Some civil society organizations played considerable advocacy and consciousness raising roles in Indonesia for decades. For example, Nahdatul Ulama (NU), the largest Muslim organization in Indonesia, with millions of members, 330 branch offices, 6,000 traditional boarding schools or Pondok Pesantren, and 21,000 schools throughout the country has been an influential civil society organization since the beginning of the 20th century. Muhammdiyah, as the oldest Islamic non-profit organization in Indonesia, followed a similar path. Both the organizations, following the revival of democracy moved to national politics. The NU established its own political party, the Partai Kebangkitan Bangsa (PKB, or National Awakening Party) in 1999. One of the charismatic leaders of Muhammadiyah founded a political party, Partai Amanat Rakayat Nasional (PAN, or National Mandate Party) in 1999. These two newly formed political parties provided a president and the speaker of the parliament, respectively, to reinforce influence of the civil society organizations in Indonesian politics.

Effect of Ownership Structure on Corporate Performance and Internal Decision-making Mechanism in Mutual Savings Banks

This study aims to focus on mutual savings banks in financial sector and explore different corporate performances and internal decision-making mechanism based on ownership structure. Especially, mutual savings banks have unique characteristics different from general corporations and financial institution. In this paper, we analyze deciding factors for management performance of mutual savings banks as financial corporations and, through this, to elucidate causes of their bankruptcy or ultimate failure. For case study, Hankook Savings Bank and Dongbu Savings Bank were selected as representative listed large saving banks with assets over 1 trillion won. This study also selected comparison group which can support indexes that caused insolvency of savings banks with assets of over 1 trillion won and investigated industry average and average of healthy and unhealthy savings banks. The results of case study and analysis on group cases in this study are as follows; Unhealthy savings banks tend to have higher asset ratio against capital than healthy ones and under the circumstances without risk management (system) and internal control system, moral hazard occurred by major stockholders who tried to take advantage of expanded asset for their own personal interests. In addition, lax laws and regulations on capital and ownership structure and relaxation policy on operation regulations produced vulnerable capital structure and abnormal asset structure.

The Effects of The Second Largest Shareholders on Earnings Management in Korea’s Mutual Savings Banks

The Effects of The Second Largest Shareholders on Earnings Management in Korea’s Mutual Savings Banks

The Impact of Block shareholder on Quality of Internal Control in Korea’s Mutual Savings Banks

The Impact of Block shareholder on Quality of Internal Control in Korea’s Mutual Savings Banks

The competition and coexistence of mutual and commercial banks in New England, 1870–1914

Scholars have studied the US banking systems of the late nineteenth century, but the presence and influence of mutual savings banks has largely gone unexamined. A new annual database of New England banks shows that mutual savings banks had a significant presence in the postbellum banking system. Mutual savings banks accounted for about 75 % of the region’s total bank deposits and largely avoided financial panics. The banks seemed to have complemented rather than competed with national banks. Mutual savings bank growth was correlated with agriculture and urbanization, whereas national bank growth was correlated with manufacturing. Mutual savings banks also channeled significant funds to national banks through the interbank network.