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The effect of bundling trade association monitoring and female board representation on loan losses in community credit unions

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posted on 2023-06-09, 23:24 authored by Anne Marie Ward, John Forker, Barry ReillyBarry Reilly
Loan book management is important to community credit union survival, particularly in deprived localities. Consistent with agency theory, prior studies of credit unions report an association among individual monitoring mechanisms, trade association monitoring, and female board representation, respectively, and reduced loan losses. This study provides a more nuanced understanding by investigating the moderating influence of these monitoring mechanisms on the relationship between loan losses and deprivation and by considering the effect of bundle combinations of different levels of the two monitoring mechanisms on loan losses. The results reveal that credit unions subject to trade association monitoring have the lowest loan losses. However, in the absence of trade association monitoring, female board representation has a moderating effect on loan losses as deprivation increases. Finally, trade association monitoring and female board representation have a substitutive, rather than a complementary effect on loan losses.

History

Publication status

  • Published

File Version

  • Published version

Journal

Nonprofit and Voluntary Sector Quarterly

ISSN

0899-7640

Publisher

SAGE Publications

Page range

1-23

Department affiliated with

  • Economics Publications

Full text available

  • Yes

Peer reviewed?

  • Yes

Legacy Posted Date

2021-03-22

First Open Access (FOA) Date

2021-03-22

First Compliant Deposit (FCD) Date

2021-03-22

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