An Overview of Cooperative Banking in Europe

  • Simon CornéeEmail author
  • Lucrezia Fattobene
  • Marco Migliorelli


This chapter aims to give a general introduction on cooperative banking in Europe. To do that, it first gives an overview on the key inherent characteristics of cooperative banks. Second, it analyses the main phases of their development in Europe. Third, it discusses the actual presence of cooperative banks over the continent in terms of size and geographical distribution. Finally, it summarises the relevant existing literature. Overall, the systemic relevance and countercyclical attitude of cooperative banks as well as their crucial role in fostering relationship lending practices are highlighted.


European cooperative banks Cooperative principles Membership Proximity Relationship banking Great Crisis 


  1. Abdesselam, R., Cieply, S., & Le Pape, N. (2002). Les facteurs de différentiation des banques mutualistes et AFB en matière de financement des PME-PMI. Revue d’Economie Financière, 67, 121–131.CrossRefGoogle Scholar
  2. Alexopoulos, Y., & Goglio, S. (2009). Financial Deregulation and Economic Distress: Is There a Future for Financial Co-Operatives? Euricse Working Papers, No. 001/09.Google Scholar
  3. Angelini, P., Di Salvo, R., & Ferri, G. (1998). Availability and Cost of Credit for Small Businesses: Customer Relationships and Credit Cooperatives. Journal of Banking & Finance, 22(6–8), 925–954.CrossRefGoogle Scholar
  4. Ayadi, R. (2017). Banks’ Business Models in Europe: Are Cooperative Banks Different? In E. Miklaszewska (Ed.), Institutional Diversity in Banking: Small Country, Small Bank Perspectives. London: Palgrave Macmillan.Google Scholar
  5. Ayadi, R., Llewellyn, D., Schmidt, R. H., Arbak, E., & De Groen, P. W. (2009). Investigating Diversity in the Banking Sector in Europe: Performance and Role of Savings Banks. Brussels: CEPS Paperbacks.Google Scholar
  6. Ayadi, R., Llewellyn, D., Schmidt, R. H., Arbak, E., & De Groen, P. W. (2010). Investigating Diversity in the Banking Sector in Europe: Key Developments, Performance and Role of Cooperative Banks. Brussels: CEPS Paperbacks.Google Scholar
  7. Barker, J. L., Bronstein, J. L., Friesen, M. L., Jones, E. I., Reeve, H. K., Zink, A. G., & Frederickson, M. E. (2017). Synthesizing Perspectives on the Evolution of Cooperation Within and Between Species. Evolution, 71, 814–825.CrossRefGoogle Scholar
  8. Becchetti, L., Ciciretti, R., & Paolantonio, A. (2016). The Cooperative Bank Difference Before and After the Global Financial Crisis. Journal of International Money and Finance, 69, 224–246.CrossRefGoogle Scholar
  9. Berger, A. N., Miller, N. H., Petersen, M. A., Rajan, R. G., & Stein, J. C. (2005). Does Function Allow Organizational Form? Evidence from the Lending Practices of Large and Small Banks. Journal of Financial Economics, 76(2), 237–269.CrossRefGoogle Scholar
  10. Berger, A. N., Rosen, R. J., & Udell, G. F. (2007). Does Market Size Structure Affect Competition: The Case of Small Business Lending. Journal of Banking & Finance, 31(1), 11–33.CrossRefGoogle Scholar
  11. Berger, A. N., & Udell, G. F. (1995). Relationship Lending and Lines of Credit in Small Firm Finance. Journal of Business, 68(3), 351–381.CrossRefGoogle Scholar
  12. Birchall, J., & Ketilson, L. H. (2009). Resilience of the Cooperative Business Model in Times of Crisis. Geneva: International Labour Office, Sustainable Enterprise Programme.Google Scholar
  13. Bolton, P., Freixas, X., Gambacorta, L., & Mistrulli, P. E. (2013). Relationship and Transaction Lending in a Crisis. BIS Working Papers, No. 417.Google Scholar
  14. Boot, A. W. A. (2000). Relationship Banking: What Do We Know? Journal of Financial Intermediation, 9(1), 7–25.CrossRefGoogle Scholar
  15. Boscia, V., Carretta, A., & Schwizer, P. (2009). Cooperative Banking: Innovations and Developments. London: Palgrave Macmillan.CrossRefGoogle Scholar
  16. Boscia, V., Carretta, A., & Schwizer, P. (2010). Cooperative Banking in Europe: Case Studies. London: Palgrave Macmillan.Google Scholar
  17. Brunetti, M., Ciciretti, R., & Djordjevic, L. (2016). The Determinants of Household’s Bank Switching. Journal of Financial Stability, 26, 175–189.CrossRefGoogle Scholar
  18. Bülbül, D., Schmidt, R. H., & Schüwer, U. (2013). Savings Banks and Cooperative Banks in Europe. White Paper Series No. 5.Google Scholar
  19. Carretta, A. (2011). Il Credito Cooperativo. Storia, Diritto, Economia, Organizzazione. Bologna: Il Mulino.Google Scholar
  20. Chiaramonte, L., Poli, F., & Oriani, M. E. (2015). Are Cooperative Banks a Lever for Promoting Bank Stability? Evidence from the Recent Financial Crisis in OECD Countries. European Financial Management, 21(3), 491–523.CrossRefGoogle Scholar
  21. Choulet, C. (2016). Institutional Protection Systems: Are They Banking Groups? BNP Economic Research.Google Scholar
  22. Coccorese, P., & Shaffer, S. (2018). Cooperative Banks and Local Economic Growth. CAMA Working Paper No. 11/2018.Google Scholar
  23. Cole, R. A., Goldberg, L. G., & White, J. W. (2004). Cookie Cutter vs. Character: The Micro Structure of Small Business Lending by Large and Small Banks. Journal of Financial and Quantitative Analysis, 39(2), 227–250.CrossRefGoogle Scholar
  24. Cornée, S. (2014). Soft Information and Default Prediction in Cooperative and Social Banks. Journal of Organizational and Entrepreneurial Diversity, 3(1), 89–109.Google Scholar
  25. Cornée, S. (2017). The Relevance of Soft Information for Predicting Small Business Credit Default: Evidence from a Social Bank. Journal of Small Business Management, in press.Google Scholar
  26. Cornée, S., Kalmi, P., & Szafarz, A. (2017). The Business Model of Social Banking. Unpublished Manuscript.Google Scholar
  27. Cornée, S., Masclet, D., & Thenet, G. (2012). Credit Relationships: Evidence from Experiments with Real Bankers. Journal of Money, Credit and Banking, 44(5), 957–980.CrossRefGoogle Scholar
  28. D’Auria, C., Foglia, A., & Reedtz, P. (1999). Bank Interest Rates and Credit Relationships in Italy. Journal of Banking and Finance, 23(7), 1067–1093.CrossRefGoogle Scholar
  29. Degryse, H., & Ongena, S. (2005). Distance, Lending Relationships, and Competition. Journal of Finance, 60(1), 231–266.CrossRefGoogle Scholar
  30. Degryse, H., & Van Cayseele, P. (2000). Relationship Lending Within a Bank-Based System: Evidence from European Small Business Data. Journal of Financial Intermediation, 9(1), 90–109.CrossRefGoogle Scholar
  31. Desrochers, M., & Fischer, K. P. (2005). The Power of Networks: Integration and Financial Cooperative Performance. Annals of Public and Cooperative Economics, 76(3), 307–354.CrossRefGoogle Scholar
  32. DeYoung, R., Hunter, W. C., & Udell, G. F. (2004). The Past, Present and Probable Future of Community Banks. Journal of Financial Service Research, 25(2–3), 85–133.CrossRefGoogle Scholar
  33. Di Salvo, R. (2002). La gouvernance des systèmes bancaires mutualistes et coopératifs en Europe. Revued’Economie Financière, 67, 65–177.Google Scholar
  34. Egarius, D., & Weill, L. (2016). Switching Costs and Market Power in the Banking Industry: The Case of Cooperative Banks. Journal of International Financial Markets, Institutions and Money, 42, 155–165.CrossRefGoogle Scholar
  35. Elsas, R., & Krahnen, J. P. (1998). Is Relationship Lending Special? Evidence from Credit-File Data in Germany. Journal of Banking and Finance, 22(10–11), 1283–1316.CrossRefGoogle Scholar
  36. ESBG. (2013). European Savings Banks Group, Key Figures.Google Scholar
  37. Fehr, E., Brown, M., & Zehnder, C. (2009). On Reputation: A Microfoundation of Contract Enforcement and Price Rigidity. Economic Journal, 119(536), 333–353.CrossRefGoogle Scholar
  38. Fehr, E., & Zehnder, C. (2006). Reputation and Credit Market Formation. FINRISK Working Paper, University of Zurich.Google Scholar
  39. Ferri, G., Kalmi, P., & Kerola, E. (2014). Does Bank Ownership Affect Lending Behavior? Evidence from the Euro Area. Journal of Banking and Finance, 48, 194–209.CrossRefGoogle Scholar
  40. Fiordelisi, F., & Mare, D. S. (2014). Competition and Financial Stability in European Cooperative Banks. Journal of International Money and Finance, 45, 1–16.CrossRefGoogle Scholar
  41. Fonteyne, W. (2007). Co-operative Banks in Europe – Policy Issues. IMF Working Paper.Google Scholar
  42. Fulton, M. (1999). Cooperatives and Member Commitment. Finnish Journal of Business Economics, 4, 418–437.Google Scholar
  43. Gambacorta, L. (2008). How Do Banks Set Interest Rates? European Economic Review, 52(5), 792–819.CrossRefGoogle Scholar
  44. Gianfaldoni, P., & Richez-Battesti, N. (2005). Les Banques Coopératives en France: Entre Spécificités et Banalisation. Rapport pour la DIIESE.Google Scholar
  45. Gintis, H., Bowles, S., Boyd, R., & Fehr, E. (2004). Moral Sentiments and Material Interests: The Foundations of Cooperation in Economic Life. Cambridge: MIT Press.Google Scholar
  46. Groeneveld, J. M. (2017). A Snapshot of European Co-operative Banking 2017. Tilburg: TIAS School for Business and Society.Google Scholar
  47. Grunert, J., Norden, L., & Weber, M. (2005). The Role of Non-Financial Factors in Internal Credit Ratings. Journal of Banking and Finance, 29(2), 509–531.CrossRefGoogle Scholar
  48. Guille, M. (1994). Savoir bancaire spécifique, marché du crédit et intermédiation financière. Economie Appliquée, 67, 49–77.Google Scholar
  49. Hansmann, H. (1997). The Ownership of Enterprise. Cambridge, MA: Harvard University Press.Google Scholar
  50. Harari, Y. N. (2012). From Animals into Gods: A Brief History of Humankind. North Charleston, SC: CreateSpace Independent Publishing Platform.Google Scholar
  51. Hesse, H., & Cihac, M. (2007). Cooperative Banks and Financial Stability. Working Paper No. 07/02, International Monetary Fund.Google Scholar
  52. Iannotta, G., Nocera, G., & Sironi, A. (2007). Ownership Structure, Risk and Performance in the European Banking Industry. Journal of Banking & Finance, 31(7), 2127–2149.CrossRefGoogle Scholar
  53. Karafolas, S. (2016). Credit Cooperative Institutions in European Countries. Berlin: Springer.CrossRefGoogle Scholar
  54. Kay, J. (2006, April 26). The Mutual Interest in Building Trust Still Remains. Financial Times.Google Scholar
  55. Köhler, M. (2015). Which Banks Are More Risky? The Impact of Business Models on Bank Stability. Journal of Financial Stability, 16, 195–212.CrossRefGoogle Scholar
  56. La “governance” des systèmes bancaires mutualistes et coopératifs en EuropeGoogle Scholar
  57. Labye, A., Lagoutte, C., & Renversez, F. (2002). Banques Mutualistes et Systèmes Financiers: une Analyse Comparative. Allemagne, Grande-Bretagne, France. Revue d’Economie Financière, 67, 85–109.CrossRefGoogle Scholar
  58. Lang, F., Signore, S., & Gvetadze, S. (2016). The Role of Cooperative Banks and Smaller Institutions for the Financing of SMEs and Small Midcaps in Europe. EIF Working Paper 2016/36, Luxembourg.Google Scholar
  59. Lehmann, E., & Neuberger, D. (2001). Do Lending Relationships Matter? Evidence from Bank Survey Data in Germany. Journal of Economic Behavior and Organization, 45(4), 339–359.CrossRefGoogle Scholar
  60. Leyshon, A., & Thrift, N. (1999). Lists Come Alive: Electronic Systems of Knowledge and the Rise of Credit-Scoring in Retail Banking. Economy and Society, 28(3), 434–466.CrossRefGoogle Scholar
  61. Liberti, J. M., & Mian, A. R. (2009). Estimating the Effect of Hierarchies on Information Use. Review of Financial Studies, 22(10), 4057–4090.CrossRefGoogle Scholar
  62. Machauer, A., & Weber, M. (1998). Bank Behavior Based on Internal Credit Ratings of Borrowers. Journal of Banking and Finance, 22(10–11), 1355–1383.CrossRefGoogle Scholar
  63. Mercieca, S., Schaeck, K., & Wolfe, S. (2007). Small European Banks: Benefits from Diversification? Journal of Banking and Finance, 31, 1975–1998.CrossRefGoogle Scholar
  64. Meriläinen, J. M. (2016). Lending Growth During the Financial Crisis and the Sovereign Debt Crisis: The Role of Bank Ownership Type. Journal of International Financial Markets, Institutions and Money, 41, 68–182.CrossRefGoogle Scholar
  65. Meriläinen, J. M. (2017). Western European Stakeholder Banks’ Loan Loss Accounting. Journal of Financial Services Research, in press.Google Scholar
  66. Migliorelli, M., & Brunelli, S. (2016). The Transmission of the Monetary Policy in the Euro Area: The Role of the Banks’ Business Model. Annals of Public and Cooperative Economics, 88(3), 303–322.CrossRefGoogle Scholar
  67. Migliorelli, M., & Dessertine, P. (2017). Time for New Financing Instruments? A Market-Oriented Framework to Finance Environmentally Friendly Practices in EU Agriculture. Journal of Sustainable Finance and Investment, 8(1), 1–25.CrossRefGoogle Scholar
  68. Orléan, A. (1999). Le Pouvoir de la Finance. Paris: Odile Jacob.Google Scholar
  69. Ory, J.-N., Jaeger, M., & Gurtner, E. (2006). La Banque à Forme Coopérative Peut-elle Soutenir Durablement la Compétition avec la Banque SA? Finance Contrôle Stratégie, 9(2), 121–157.Google Scholar
  70. 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
  71. Pennisi, E. (2005). How Did Cooperative Behavior Evolve? Science, 309, 93.Google Scholar
  72. Petersen, M. A., & Rajan, R. G. (1994). The Benefits of Lending Relationships: Evidence from Small Business Data. Journal of Finance, 49(1), 3–37.CrossRefGoogle Scholar
  73. Petersen, M. A., & Rajan, R. G. (1995). The Effect of Credit Market Competition on Lending Relationships. Quarterly Journal of Economics, 110(2), 407–443.CrossRefGoogle Scholar
  74. Pirvu, D., & Banica, L. (2016). The Credit Cooperative System in Romania. In B. Casu & A. Gall (Eds.), Building Societies in the Financial Services Industry. London: Palgrave Macmillan.Google Scholar
  75. Raiffeisen, F. W. (1866). Le Associazioni Casse di Prestito. ristampa Ecra 2010.Google Scholar
  76. Rilling, J. K., Gutman, D. A., Zeh, T. R., Pagnoni, G., Berns, G. S., & Kilts, C. D. (2002). A Neural Basis for Social Cooperation. Neuron, 35(2), 395–405.CrossRefGoogle Scholar
  77. Rivaud-Danset, D. (1996). Les contrats de crédit dans une relation de long terme. De la main invisible à la poignée de main. Revue Economique, 27(4), 937–962.Google Scholar
  78. Scott, J. A. (2004). Small Businesses and the Value of Community Banks. Journal of Financial Service Research, 25(2–3), 207–230.CrossRefGoogle Scholar
  79. Sharpe, S. A. (1990). Asymmetric Information, Bank Lending, and Implicit Contracts: A Stylized Model of Customer Relationships. Journal of Finance, 45(4), 1069–1087.Google Scholar
  80. Standard and Poor. (2017, April). The World’s 100 Largest Banks.Google Scholar
  81. Stein, J. C. (2002). Information Production and Capital Allocation: Decentralized Versus Hierarchical Firms. Journal of Finance, 57(5), 1891–1921.CrossRefGoogle Scholar
  82. Tamagnini, G. (1960). Appunti di Storia della Cooperazione. Le Cooperative di Credito, Rivista della cooperazione.Google Scholar
  83. Uzzi, B. (1999). Embeddedness in the Making of Financial Capital: How Social Relations and Networks Benefit Firms Seeking Financing. American Sociological Review, 64(4), 481–505.CrossRefGoogle Scholar
  84. Uzzi, B., & Lancaster, R. (2003). Relational Embeddedness and Learning: The Case of Bank Loan Managers and Their Clients. Management Science, 49(4), 383–399.CrossRefGoogle Scholar
  85. Von Thadden, E. (1995). Long-Term Contracts, Short-Term Investments and Monitoring. Review of Economic Studies, 62(4), 557–575.CrossRefGoogle Scholar

Copyright information

© The Author(s) 2018

Authors and Affiliations

  • Simon Cornée
    • 1
    Email author
  • Lucrezia Fattobene
    • 2
    • 3
  • Marco Migliorelli
    • 4
  1. 1.University of Rennes 1RennesFrance
  2. 2.Polytechnic University of MarcheAnconaItaly
  3. 3.University of Rome Tor VergataRomeItaly
  4. 4.IAE Université Paris 1 Panthéon-Sorbonne (Sorbonne Business School)ParisFrance

Personalised recommendations