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Regulatory Change and Capital Adjustment of US Credit Unions

Goddard, J. and McKillop, D. and Wilson, J.O.S. (2015) Regulatory Change and Capital Adjustment of US Credit Unions. Journal of Financial Services Research. DOI: 10.1007/s10693-015-0217-y

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Abstract

We investigate the determinants of US credit union capital-to-assets ratios, before and after the implementation of the current capital adequacy regulatory framework in 2000. Capitalization varies pro-cyclically, and until the financial crisis credit unions classified as adequately capitalized or below followed a faster adjustment path than well capitalized credit unions. This pattern was reversed, however, in the aftermath of the crisis. The introduction of the PCA regulatory regime achieved a reduction in the proportion of credit unions classified as adequately capitalized or below that continued until the onset of the crisis. Since the crisis, the speed of recovery of credit unions in this category following an adverse capitalization shock was sharply reduced.

Item Type: Article
Subjects: Research Publications
Departments: College of Business, Law, Education and Social Sciences > Bangor Business School
Date Deposited: 29 May 2015 02:45
Last Modified: 26 Apr 2016 02:54
ISSN: 0920-8550
Publisher's Statement: The final publication is available at Springer via http://dx.doi.org/10.1007/s10693-015-0217-y
URI: http://e.bangor.ac.uk/id/eprint/4602
Identification Number: DOI: 10.1007/s10693-015-0217-y
Publisher: Springer
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