Economics of the credit union

This book originated in a series of studies commis sioned by the National Credit Union Management Conference, an organization of credit unions each with assets greater than one million dollars. The Conference, which generally views the credit union as an economic tool and strives to develop among its participants a business-efficiency approach to the operation of a credit union, had since 1949 collected statistics from its membership and discussed them at regular sessions. In 1957 it was decided to focus the annual questionnaires on par ticular topics which would be analyzed in depth. As here pre sented the original studies have been edited, and dated material has been removed. The material used, its treatment, and the conclusions reached are entirely the responsibility of the author.

In the years since 1953 the Conference has spent some $50, 000 to gather and catalog the statistical material used in this book. New yardsticks have been developed, tested, and re viewed. These studies have helped us to establish that the credit union is a form of organization exhibiting some characteristics that are common to business generally and others that are unique.

Credit unions have proved to be extremely difficult to meas ure, even one against the other. When economists try to analyze the credit union, using only the common tools of the profession, they may fail to achieve a meaningful result. So far as I know, this is the first attempt to examine credit unions objectively from the economic point of view.

Chapter 1, "The Economic Dimension of Credit Unions," was written expressly for this book. It owes its inspiration to a group of researchers, writing for the most part in the Journal of Farm Economics, who made a theoretical breakthrough in their basic studies on the economic nature of the cooperative association. Probably the most controversial of all of the conference stud

ies, "Management Reviews Reserves," was delivered in October, 1957, in Los Angeles. In discussion from the floor were raised to the point of view expressed, and this was fol lowed by letters in the Credit Union Bridge. This is the sub ject matter of Chapter 2. "Credit Union Liquidity" and "Credit Union Growth," Chapters 3 and 4, were taken up at the 1958 conference meeting in Philadelphia.

"Gross Investment Yields and Credit Union Types," Chapter 5, were studied at the 1959 meeting in Detroit. In 1960 at the Dallas meeting individual credit union statistics were compiled, but no analysis was made. In 1961 the study, "Income, Ex penses, and Management Efficiency," was presented to the con ference group in Seattle. This appears in Chapter 6. Chapter 7, "Financial Efficiency in Large Credit Unions," was taken up at the 1962 meeting in Washington, D. C.