Journal of Business Ethics

, Volume 151, Issue 2, pp 319–336 | Cite as

How Well Have Social Economy Financial Institutions Performed During the Crisis Period? Exploring Financial and Social Efficiency in Spanish Credit Unions

  • Almudena Martínez-Campillo
  • Yolanda Fernández-Santos
  • María del Pilar Sierra-Fernández


As Social Economy financial institutions, credit unions have traditionally been considered less efficient than traditional banking entities. However, like banks and savings banks, they have to be as efficient and competitive as possible to survive in today’s business environment, especially at times of crisis. To date, there have been very few studies on their efficiency and practically none for the crisis period. Moreover, almost all the existing studies assess only financial efficiency, without considering their social function. This study examines the levels of both financial and social efficiency in Spanish credit unions as well as their main determinants during the recent crisis. We apply the two-stage double bootstrap data envelopment analysis (DEA) methodology based on panel data corresponding to all the credit unions active in Spain between 2008 and 2013. The empirical results indicate that financial and social efficiency achieved an acceptable level, although on average the former was slightly greater than the latter. We also find that both age and merger and acquisition activity were positively influential on the financial efficiency of credit unions but had a significant negative effect on their social efficiency. Moreover, the regional location of such entities and the financial crisis were also crucial determinants of both types of efficiency. Our findings are therefore useful for all the stakeholders of credit unions to know if these entities have been efficient according to a double bottom line accounting in the crisis period and hence to maintain successful social management that is compatible with satisfactory financial efficiency.


Credit unions Crisis period Financial efficiency Social Economy financial institutions Social efficiency 



Data envelopment analysis


Unión Nacional de Cooperativas de Crédito (National Union of Credit Unions)


Small and medium-sized enterprises


Stochastic frontier analysis


Decision making unit


Constant returns to scale


Variable returns to scale


Gross domestic product












Security investments


Customer socialisation


Financial inclusion


Social fund contribution






Merger and Acquisition activity


Corporate group


Regional location




  1. Asociación Española de Banca. (2008–2013). Anuarios Estadísticos/Statistical yearbooks. Madrid: AEB. Retrieved from
  2. Banker, R. D., Charnes, A., & Cooper, W. W. (1984). Some models for estimating technical and scale inefficiencies in DEA. Management Science, 30, 1078–1092.CrossRefGoogle Scholar
  3. Barra, C., Destefanis, S., & Lavadera, G. L. (2013). Regulation and the risk: The efficiency of Italian cooperative banks. Working Paper nº 338. Centre for Studies in Economics and Finance (CSEF), University of Naples (Italy).Google Scholar
  4. Battilana, J., Sengul, M., Pache, A. C., & Model, J. (2015). Harnessing productive tensions in hybrid organizations: The case of work integration social enterprises. Academy of Management Journal, 58, 1658–1683.CrossRefGoogle Scholar
  5. Belmonte, L. J. (2012). La eficiencia social de las cooperativas de crédito españolas: Una aproximación mediante el análisis DEA. Revista de Micro-finanzas y Banca Social, 1, 133–151.Google Scholar
  6. Belmonte, L. J., & Plaza, J. A. (2008). Análisis de la eficiencia en las cooperativas de crédito en España: Una propuesta metodológica basada en el análisis envolvente de datos (DEA). CIRIEC-España, Revista de Economía Pública, Social y Cooperativa, 63, 113–133.Google Scholar
  7. Berger, A. N., & Humphrey, D. B. (1997). Efficiency of financial institutions: International survey and directions for future research. European Journal of Operational Research, 98, 175–212.CrossRefGoogle Scholar
  8. Brown, R. (2006). Mismanagement or mismeasurement? Pitfalls and protocols for DEA studies in the financial services sector. European Journal of Operational Research, 174(2), 1100–1116.CrossRefGoogle Scholar
  9. Brown, R., Brown, R., & O’Connor, I. (1999). Efficiency, bond of association and exit patterns in credit unions: Australian evidence. Annals of Public and Cooperative Economics, 70, 5–23.CrossRefGoogle Scholar
  10. Charnes, A., Cooper, W. W., & Rhodes, E. (1978). Measuring the efficiency of decision making units. European Journal of Operational Research, 2, 429–444.CrossRefGoogle Scholar
  11. Confederación Española de Cajas de Ahorros. (2008–2013). Informes Anuales/Annual reports. Madrid: CECA. Retrieved from
  12. Cooper, W. W., Seiford, L. M., & Tone, K. (2007). Data envelopment analysis. New York: Springer.Google Scholar
  13. Cornée, S., & Szafarz, A. (2014). Vive la différence: Social banks and reciprocity in the credit market. Journal of Business Ethics, 125(3), 361–380.CrossRefGoogle Scholar
  14. Curi, C., Guarda, P., Lozano-Vivas, A., & Zelenyuk, V. (2012). Is foreign-bank efficiency in financial centers driven by home or host country characteristics? Journal of Productivity Analysis, 40(3), 367–385.CrossRefGoogle Scholar
  15. De Castro, M., & Motellón, C. (2011). El modelo de banca cooperativa: el acierto de un siglo. In Unión Nacional de Cooperativas de Crédito (Ed.), 40 Años de la UNACC: El Nuevo Mapa del Sistema Financiero (pp. 73–77). Madrid: UNACC.Google Scholar
  16. Destefanis, S., Barra, C., & Lavadera, G. L. (2014). Financial development and local growth: Evidence from highly disaggregated Italian data. Applied Financial Economics, 24(24), 1605–1615.CrossRefGoogle Scholar
  17. Efron, B., & Tibshirani, R. J. (1993). An introduction of the bootstrap. New York: Chapman and Hall/CRC.CrossRefGoogle Scholar
  18. Farrell, M. J. (1957). The measurement of productive efficiency. Journal of the Royal Statistical Society: Series A, 120(3), 253–290.CrossRefGoogle Scholar
  19. Fortin, M., & Leclerc, A. (2011). L’efficience des cooperatives de services financiers: Une analyse de la contribution du milieu. Annals of Public and Cooperative Economics, 82(1), 45–62.CrossRefGoogle Scholar
  20. Fried, H. O., Lovell, C. A. K., & Vanden Eeckaut, P. (1993). Evaluating the performance of U.S. credit unions. Journal of Banking and Finance, 17(2), 251–265.CrossRefGoogle Scholar
  21. Fried, H. O., Lovell, C. A. K., & Yaisawarng, S. (1999). The impact of mergers on credit union service provision. Journal of Banking & Finance, 23, 367–386.CrossRefGoogle Scholar
  22. Fukuyama, H. (1996). Returns to scale and efficiency of credit associations in Japan. Japan and the World Economy, 8, 259–277.CrossRefGoogle Scholar
  23. Fukuyama, H., Guerra, R., & Weber, W. L. (1999). Efficiency and ownership: Evidence from Japanese credit unions. Journal of Economics and Business, 51, 473–487.CrossRefGoogle Scholar
  24. Garden, K. A., & Ralston, D. E. (1999). The X-efficiency and allocative efficiency effects of credit union mergers. Journal of International Financial Markets, Institutions & Money, 9, 285–301.CrossRefGoogle Scholar
  25. Glass, J. C., McKillop, D. G., Quinn, B., & Wilson, J. (2014). Cooperative bank efficiency in Japan: A parametric distance function analysis. The European Journal of Finance, 20(3), 291–317.CrossRefGoogle Scholar
  26. Gutiérrez, M., & Palomo, R. (2012). Los sistemas institucionales de protección como respuesta de la banca cooperativa española ante la crisis: Hacia la búsqueda de la eficiencia en su integración. CIRIEC-Revista de Economía Pública, Social y Cooperativa, 76, 27–50.Google Scholar
  27. Gutiérrez-Nieto, B., Serrano-Cinca, C., & Camón-Cala, J. (2015). A credit score system for socially responsible lending. Journal of Business Ethics. doi: 10.1007/s10551-014-2448-5.Google Scholar
  28. Gutierrez-Niéto, B., Serrano-Cinca, C., & Molinero, C. M. (2009). Social efficiency in microfinance institutions. Journal of Operational Research Society 60, 104–119.CrossRefGoogle Scholar
  29. Hermes, N., Lensink, R., & Meesters, A. (2011). Outreach and efficiency of microfinance institutions. World Development, 39(6), 938–948.CrossRefGoogle Scholar
  30. Jackson, K. T. (2015). Economy of mutuality: Merging financial and social sustainability. Journal of Business Ethics. doi: 10.1007/s10551-014-2408-0.Google Scholar
  31. Kalmi, P. (2012). Cooperative banking. In J. Toporowski & J. Michell (Eds.), Handbook of critical issues in finance (pp. 56–65). London: Edward Elgar Publishing.CrossRefGoogle Scholar
  32. Martínez-Campillo, A., Cabeza-García, L., & Marbella-Sánchez, F. (2013). Corporate social responsibility and results: Evidence of two-way causality in the savings bank. Cuadernos de Dirección y Economía de la Empresa (Business Research Quarterly), 16(1), 54–68.CrossRefGoogle Scholar
  33. Mcalevey, L., Sibbald, A., & Tripe, D. (2010). New Zealand credit union mergers. Annals of Public and Cooperative Economics, 81(3), 423–444.CrossRefGoogle Scholar
  34. Mester, L. J. (1996). A study of bank efficiency taking into account risk-preferences. Journal of Banking & Finance, 20, 1025–1045.CrossRefGoogle Scholar
  35. Miles, M. P., Verreynne, M. L., & Luke, B. (2014). Social enterprises and the performance advantages of a Vincentian marketing orientation. Journal of Business Ethics, 123(4), 549–556.CrossRefGoogle Scholar
  36. Moradi-Motlagh, A., Valadkhani, A., & Saleh, A. S. (2015). Rising efficiency and cost saving in Australian banks: A bootstrap approach. Applied Economics Letters, 22(3), 189–194.CrossRefGoogle Scholar
  37. Ory, J. N., & Lemzeri, Y. (2012). Efficiency and hybridization in cooperative banking: The French case. Annals of Public and Cooperative Economics, 83(2), 215–250.CrossRefGoogle Scholar
  38. Othman, A., Mansor, N., & Kari, F. (2014). Assessing the performance of co-operatives in Malaysia: An analysis of co-operative groups using a data envelopment analysis approach. Asia Pacific Business Review, 20(3), 484–505.CrossRefGoogle Scholar
  39. Pache, A. C., & Santos, F. (2013). Inside the hybrid organization: Selective coupling as a response to competing institutional logics. Academy of Management Journal, 56, 972–1001.CrossRefGoogle Scholar
  40. Paxton, J. (2007). Technical efficiency in a semi-formal financial sector: The case of Mexico. Oxford Bulletin of Economics and Statistics, 69(1), 57–74.CrossRefGoogle Scholar
  41. Piot-Lepetit, I., & Nzongang, J. (2014). Financial sustainability and poverty outreach within a network of village banks in Cameroon: A multi-DEA approach. European Journal of Operational Research, 234(1), 319–330.CrossRefGoogle Scholar
  42. Ralston, D., Wright, A., & Garden, K. (2001). Can mergers ensure the survival of credit unions in the third millennium. Journal of Banking & Finance, 25, 2277–2304.CrossRefGoogle Scholar
  43. Ramus, T., & Vaccaro, A. (2015). Stakeholders matter: How social enterprises address mission drift. Journal of Business Ethics. doi: 10.1007/s10551-014-2353-y.Google Scholar
  44. Santos, F., Pache, A., & Birkholz, C. (2015). Making hybrids work: Aligning business models and organizational design for social enterprises. California Management Review, 57(3), 36–58.CrossRefGoogle Scholar
  45. Server, R. J., & Capó-Vicedo, J. (2011). The interrelationship between the demands of Corporate Social Responsibility and cooperative principles and values. CIRIEC-España: Revista de Economía Pública, Social y Cooperativa, 73, 213–232.Google Scholar
  46. Servin, R., Lensink, R., & van der Berg, M. (2012). Ownership and technical efficiency of microfinance institutions: Empirical evidence from Latin America. Journal of Banking & Finance, 36(7), 2136–2144.CrossRefGoogle Scholar
  47. Sierra, C., & Sánchez, E. (2013). Evolución reciente de las oficinas del Community Banking en España: Un nuevo entorno tras la crisis. Análisis AFI. 2º semestre, pp. 21–29.Google Scholar
  48. Simar, L., & Wilson, P. W. (2000). A general methodology for bootstrapping in non-parametric frontier models. Journal of Applied Statistics, 27(6), 779–802.CrossRefGoogle Scholar
  49. Simar, L., & Wilson, P. W. (2007). Estimation and inference in two-stage, semi-parametric models of production processes. Journal of Econometrics, 136, 31–64.CrossRefGoogle Scholar
  50. Unión Nacional de Cooperativas de Crédito (UNACC). (2008–2013). Anuarios Estadísticos de las Cooperativas de Crédito/Statistical yearbooks of credit unions. Madrid: UNACC. Retrieved from
  51. Usai, S., & Vannini, M. (2005). Banking structure and regional economic growth: lesson from Italy. Annals of Regional Science, 39, 691–714.CrossRefGoogle Scholar
  52. Wanke, P., & Barros, C. (2014). Two-stage DEA: An application to major Brazilian banks. Expert Systems with Applications, 41, 2337–2344.CrossRefGoogle Scholar
  53. Wijesiri, M., Viganò, L., & Meol, M. (2015). Efficiency of microfinance institutions in Sri Lanka: A two-stage double bootstrap DEA approach. Economic Modelling, 47(1), 74–83.CrossRefGoogle Scholar
  54. Wilson, P. W. (1993). Detecting outliers in deterministic nonparametric frontier models with multiple outputs. Journal of Business and Economics Statistics, 11(3), 319–323.Google Scholar
  55. Wilson, P. W. (2008). FEAR 1.0: A software package for frontier efficiency analysis with R. Socio-Economic Planning Sciences, 42, 247–254.CrossRefGoogle Scholar
  56. Wilson, P. W. (2010). Detecting outliers in deterministic nonparametric frontier models with multiple outputs: Correction. Working Paper. Department of Economics, Clemson University.Google Scholar
  57. Worthington, A. C. (1998a). Testing the association between production and financial performance: Evidence from a not-for-profit co-operative setting. Annals of Public and Co-operative Economics, 69, 67–83.CrossRefGoogle Scholar
  58. Worthington, A. C. (1998b). The determinants of non-bank financial institution efficiency: A stochastics frontier approach. Applied Financial Economics, 8, 279–287.CrossRefGoogle Scholar
  59. Worthington, A. C. (1999). Measuring technical efficiency in Australian credit unions. The Manchester School, 67(2), 231–248.CrossRefGoogle Scholar
  60. Worthington, A. C. (2001). Efficiency in pre-merger and post-merger non-bank financial institutions. Managerial and Decision Economics, 22, 439–452.CrossRefGoogle Scholar
  61. Worthington, A. C. (2010). Frontier efficiency measurement in deposit-taking financial mutuals: A review of techniques, applications, and future research directions. Annals of Public and Cooperative Economics, 81(1), 39–75.CrossRefGoogle Scholar
  62. Wyman, O. (2014). Cooperative banking: Leveraging the cooperative difference to adapt to a new environment. Chicago: Marsh & McLennan Company.Google Scholar
  63. Zvolská, M., & Olsson, J. (2012). Cooperatives and restructuring. Brussels: European Economic and Social Committee.Google Scholar

Copyright information

© Springer Science+Business Media Dordrecht 2016

Authors and Affiliations

  • Almudena Martínez-Campillo
    • 1
  • Yolanda Fernández-Santos
    • 1
  • María del Pilar Sierra-Fernández
    • 1
  1. 1.Faculty of Economics and Business AdministrationUniversity of LeónLeónSpain

Personalised recommendations