Being a Member of a Cooperative Bank: Ethical of Financial Decision?
43 Pages Posted: 6 Jun 2015
Date Written: June 4, 2015
The definition of co-operative banks given by the International Cooperative Banking Association (ICBA) states that co-operative members, who buy and hold member shares, believe in the ethical values of honesty, openness, social responsibility and caring for others. Using a unique database of 246,120 clients/members at a cooperative bank, we show that the trading volume of member shares is far from negligible. The analysis of clients’ portfolios over a 13-month period shows that clients use member shares as standard savings and investment vehicles. These results show that the reasons given by the ICBA to become a member of a cooperative bank are unimportant in the decision process.
Keywords: Cooperative Banks, Bank Membership, Capital requirements, Investor Behavior.
JEL Classification: G21, G32, P13
Suggested Citation: Suggested Citation