Migliorelli New Cooperative Banking in Europe

Strategies for Adapting the Business Model Post Crisis
1. Auflage 2018
ISBN: 978-3-319-93578-2
Verlag: Springer International Publishing
Format: PDF
Kopierschutz: 1 - PDF Watermark

E-Book, Englisch, 259 Seiten

Reihe: Progress in Mathematics

This edited volume showcases how the European cooperative banks have continued to evolve amid a new competitive scenario that resulted from the Global Financial Crisis started in Europe in 2008. The cooperative banking paradigm has been put under an unprecedented pressure as a consequence of factors such as the exceptionally low interest rates set by the European Central Bank, low profitability generated by traditional banking services-which are the backbone of the cooperative banking business-and the entrance of fintech companies into the banking market. Furthermore, tightening regulation since the beginning of the crisis has produced an increased capital and liquidity burden which in some cases have forced cooperative banks to reduce lending to their members and customers, putting under question the traditional countercyclical role of cooperative banks in periods of crisis. For these reasons, it is of the utmost value to observe and analyse how cooperative banks have been reacting in the attempt to preserve their unique business model and, at the same time, to keep providing credit to the economy. A number of scholars active in the cooperative banking sector have been involved in this edited volume as contributors.



Marco Migliorelli is a researcher in finance at the IAE of the University Paris 1 Panthéon-Sorbonne (Sorbonne Business School), France and an economist at the European Commission. He holds a PhD in banking and finance from the University of Rome Tor Vergata, Italy. His main research interests include cooperative banks, green finance and financing instruments innovation.

Autoren/Hrsg.

Migliorelli, Marco

Inhaltsverzeichnis

1;Foreword;5
2;Preface;7
3;Acknowledgements;10
4;Contents;11
5;Notes on Editor and Contributors;15
6;List of Figures;18
7;List of Tables;20
8;Chapter 1: An Overview of Cooperative Banking in Europe;22
8.1;1.1 Cooperative Banks: Origins and Fundamental Principles in Today’s World;22
8.2;1.2 Types of Cooperative Banking Groups and Networks;26
8.3;1.3 Size and Geographical Presence of Cooperative Banks in Europe;29
8.4;1.4 Cooperative Banks and Relationship Banking;34
8.5;1.5 Characteristics of the Support of Cooperative Banks to the Economy;38
8.6;1.6 Stability of Cooperative Banks;40
8.7;1.7 Cooperative Banks and Savings Banks;41
8.8;References;43
9;Chapter 2: The New Economic Scenario and Its Impact on the Cooperative Banking Business Model;49
9.1;2.1 Introduction;49
9.2;2.2 Key Elements of the New Economic Scenario;50
9.2.1;2.2.1 Low Interest Rates;50
9.2.2;2.2.2 Regulatory Burden;51
9.2.3;2.2.3 Digitalization;53
9.3;2.3 The Impact of Extremely Low Interest Rates on Cooperative Banks;54
9.3.1;2.3.1 Interest Rates and Their Impact on Bank Profitability;54
9.3.2;2.3.2 Cooperative Banks and Cooperative Banking Groups;57
9.3.3;2.3.3 Development of Cooperative Banks’ Net Interest Income and Profitability;59
9.4;2.4 Reacting to the New Economic Scenario;63
9.4.1;2.4.1 Bringing Risk to the Market;63
9.4.2;2.4.2 Reducing Costs;64
9.4.3;2.4.3 New Sources of Income;64
9.5;References;65
10;Chapter 3: Cooperative Banks Lending During and After the Great Crisis;66
10.1;3.1 Introduction;66
10.2;3.2 Lending Behaviour of Cooperative Banks in the Different Areas of the Continent;68
10.2.1;3.2.1 Analysing Lending Behaviour Via the Bank Lending Channel;68
10.2.2;3.2.2 Research Method;70
10.2.3;3.2.3 Empirical Observation and Discussion of Results;80
10.3;3.3 Lending Supply, Capitalisation and Non-performing Loans During the Great Crisis: The Italian Case;87
10.3.1;3.3.1 Credit Crunch and Levels of Banks’ Capitalisation;87
10.3.2;3.3.2 Research Method;91
10.3.3;3.3.3 Empirical Observation and Discussion of Results;95
10.4;3.4 Limits to the Countercyclical Role of Cooperative Banks;101
10.5;References;103
11;Chapter 4: Cooperative Banks and Banking Regulation in the EU: Key Elements;105
11.1;4.1 Introduction;105
11.2;4.2 The Cooperative Banking Singularity in the EU Regulation;107
11.3;4.3 Relevant Aspects of Regulation for Cooperative Banks;111
11.3.1;4.3.1 Capital Requirements;111
11.3.2;4.3.2 Governance Requirements;113
11.3.3;4.3.3 The Institutional Protection Schemes;114
11.3.4;4.3.4 The Opening of the Market of Payment Services to Third Party Providers;116
11.4;References;118
12;Chapter 5: National Initiatives to Drive the Evolution of the Cooperative Banking Sector;120
12.1;5.1 Introduction;120
12.2;5.2 The Reform of the Cooperative Banking Sector in the Netherlands;121
12.2.1;5.2.1 Overview;121
12.2.2;5.2.2 External Environment;122
12.2.2.1;Macroeconomic Environment;122
12.2.2.2;Banking Regulation and Supervision;122
12.2.2.3;Banking Sector Shake Up;123
12.2.3;5.2.3 Internal Challenges;124
12.2.4;5.2.4 Strategic Responses;126
12.2.4.1;Fundamental Governance Reform;126
12.2.4.2;Cost Reductions, Efficiency Improvements and Capitalisation;127
12.2.4.3;Strategic Reorientation;128
12.2.4.4;Evolution of the Rabobank Group;129
12.2.5;5.2.5 Concluding Remarks;130
12.3;5.3 The Reform of the Cooperative Banking Sector in Italy;131
12.3.1;5.3.1 The Cooperative Banking Industry in Italy and Its Recent Evolution;131
12.3.1.1;The Legal Framework;132
12.3.1.2;The Need for a Reform;133
12.3.2;5.3.2 The Banche Popolari Experience;135
12.3.3;5.3.3 The Role of BCCs in the Italian Economy;138
12.3.4;5.3.4 The BCC Network Organisation;140
12.3.5;5.3.5 The BCCs Reform: Context and Background;140
12.3.6;5.3.6 The BCCs Reform: Principles and Contents;142
12.3.7;5.3.7 The Implementation of the Reform: First Results and Main Challenges;145
12.4;5.4 Other Country-Level Developments in Europe from the Beginning of the Great Crisis;146
12.4.1;5.4.1 Germany;146
12.4.2;5.4.2 France;147
12.4.3;5.4.3 United Kingdom;149
12.4.4;5.4.4 Austria, Finland and Spain;152
12.5;References;154
13;Chapter 6: The Governance of Cooperative Banks: Main Features and New Challenges;157
13.1;6.1 Introduction;157
13.2;6.2 Features of the Cooperative Banking Model of Governance;158
13.2.1;6.2.1 Democracy;159
13.2.2;6.2.2 Autonomy;159
13.2.3;6.2.3 Accountability;159
13.2.4;6.2.4 Non-monetary Compensation and Recognition;160
13.2.5;6.2.5 Territorial Entrenchment;160
13.3;6.3 Models of Governance in Europe;161
13.4;6.4 Cooperative Banks and Risk Appetite;167
13.4.1;6.4.1 The Specific Place of Risk Governance in Banking;167
13.4.2;6.4.2 Does Risk Appetite Framework Push Really to Centralization?;170
13.5;6.5 The Governance Bodies of Cooperative Banks;171
13.6;6.6 The Challenges for the Cooperative Banks’ Governance Model Under New Regulatory Provisions;173
13.7;6.7 Conclusions;175
13.8;References;176
14;Chapter 7: The New Paradigm of Digital Proximity for Cooperative Banks;178
14.1;7.1 Introduction: The Banks’ Reputation Might Need Working On and Yet a Real Bond Is Actually There;178
14.2;7.2 The Bank-Client Relationship, the Bank’s Main Challenge Since Time Immemorial;179
14.2.1;7.2.1 Client Scepticism: Bank Employees Torn on the Fence Between Giving Advice and Financial Objectives;179
14.2.2;7.2.2 A Rich Relational Context Between Employees and Clients;180
14.2.3;7.2.3 Differentiating Between Banks Is No Longer Solely Relational;181
14.3;7.3 The Bank-Employee Relationship, a Connection Built on the Individual and Not Institutional Level;183
14.3.1;7.3.1 Employees Appreciative of Their Bank;183
14.3.2;7.3.2 Contrast Between a Fuzzy Brand Identity and Strong Employee Attachment to Their Cooperative Bank;184
14.4;7.4 Digital, a Lever of Competence and Positive Relations;184
14.4.1;7.4.1 More Streamlined Communication Between Colleagues;185
14.4.2;7.4.2 Greater Efficacy Between Employees and Clients;185
14.4.3;7.4.3 Clients Attributed Greater Value by the Bank;186
14.5;7.5 Cooperative Values, a Similar Vision Between Clients and Employees But Not Rooted in Banks’ Own Identities;188
14.5.1;7.5.1 Cooperative Values Clearly Established in Clients’ Minds;188
14.5.2;7.5.2 Employees Not That Convinced by the Meaning of the Word “Cooperative”, But Still Proud of the Proximity Established with the Clients;189
14.5.3;7.5.3 A Trilogy: Cooperative-Proximity-Digital;190
14.6;7.6 Conclusions: Brand, a Lever for Cooperative Banks to Create Enduring Relations with Their Clients;191
14.6.1;7.6.1 Digitality at the Service of Brand and Cooperative;191
14.6.2;7.6.2 Brands: Vectors of Meaningful Values;192
14.7;Appendix 1;194
14.8;Appendix 2;194
14.9;References;195
15;Chapter 8: The Way Forward for Cooperative Banks;197
15.1;8.1 Introduction: Innovation and Cooperative Banks;197
15.2;8.2 Keeping Membership at the Centre of the Project;200
15.3;8.3 Aggregation Versus Many Independent Small Entities;202
15.4;8.4 How to Leverage the Unique Relationship with the Client;205
15.5;8.5 Cooperative Banks, Digitalization, and Fintech;207
15.6;8.6 How to Limit the Regulatory Burden;209
15.7;8.7 Conclusions;210
15.8;References;213
16;Chapter 9: The Cooperative Banks Today in the EU Perspective;215
16.1;9.1 Introduction;215
16.2;9.2 Cooperative Banks and Diversity in Banking;217
16.2.1;9.2.1 Measuring Diversity in the Banking Sector;219
16.2.2;9.2.2 Financial and Economic Implication of Diversity in Banking;223
16.2.2.1;Diversity in Banking and Financial Stability;224
16.2.2.2;Diversity in Banking and Access to Credit;227
16.3;9.3 ‘One-Fits-All’ Regulatory Approach and Proportionality;229
16.3.1;9.3.1 Regulation and Diversity in the Banking Sector;229
16.3.2;9.3.2 Challenges of a ‘One-Size-Fits-All’ Regulatory Approach to Diversity in Banking;230
16.3.3;9.3.3 Proportionality in Banking Regulation;232
16.3.3.1;Principle of Proportionality in EU Regulation;232
16.3.3.2;Application of Proportionality to EU Banking Regulation;233
16.4;9.4 Diversity in Banking and Impact on Society;236
16.5;9.5 Summary and Conclusions;239
16.6;References;240
17;Chapter 10: Cooperative Banking in Europe Today: Conclusions;244
17.1;10.1 Stressing the Importance of Cooperative Banks in Europe;244
17.2;10.2 An External Environment That Carries Unprecedented Challenges;245
17.3;10.3 The Imperative of Restoring Profitability;248
17.4;10.4 The Call for Challenging the Cooperative Business Model;249
17.4.1;10.4.1 Rethink Proximity;249
17.4.2;10.4.2 Embrace Sustainability;251
17.4.3;10.4.3 Learn to Communicate the Cooperative Difference in Banking;252
17.4.4;10.4.4 Do Not Leave Fintech Companies Leading the Change;253
17.5;References;255
18;Index;256