신용협동조합의 영업다각화가 경영성과에 미치는 영향

This paper examines the relationship between diversification and financial performance ofcommunity credit unions in Korea from 2011 to 2017. To do so, I employ fixed-effects panelanalyses using credit union level panel data collected from the National Credit UnionFederation of Korea. This study finds evidence that business diversification is likely to lowerthe ratio of troubled loans, which means improving asset quality of credit unions. However,the relationship between diversification and asset quality is not linear but nonlinear, whichmeans over-diversification would have negative effects on asset quality. Next, diversificationtends to increase profitability. Specifically, although diversification results in a rise inexpenditures, an increase in profits made by diversification outweighs the rise in expenditures,which contributes to profitability. Put together, diversification would be a good businessstrategy to improve both profitability and asset quality. Given a result that fast loan growthdeteriorates asset quality, credit unions’ managers might adopt the diversification strategy toenhance asset quality, and not to pursue their own objectives motivated by moral hazards.