Irish credit unions: Investigating performance determinants and the opportunity cost of regulatory compliance

J. Colin Glass, Donal G. McKillop, Syamarlah Rasaratnam

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    The study investigates how producer-specific environmental factors influence the performance of Irish credit unions. The empirical analysis uses a two-stage approach. The first stage measures efficiency by a data envelopment analysis (DEA) estimator, which explicitly incorporates the production of undesirable outputs such as bad loans in the modelling, and the second stage uses truncated regression to infer how various factors influence the (bias-corrected) estimated efficiency. A key finding of the analysis is that 68% of Irish credit unions do not incur an extra opportunity cost in meeting regulatory guidance on bad debt.
    Original languageEnglish
    Pages (from-to)67-76
    JournalJournal of Banking and Finance
    Issue number1
    Publication statusPublished - Jan 2010



    • Credit unions
    • efficiency
    • regulatory compliance.

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