The Co-operative Banks Characteristics

Private retail banks owned by their customers/members: as owners, the banks’ members and customers have a direct say in the business. As a result, the primary aim of co-operative banks is to provide the best possible products and services that fit with the needs of their customers in a long-term relationship of trust. Maximising profits is not a goal per se.

Networks deeply rooted in the local economy: co-operative banks have a widespread presence throughout the EU. With more than 65,000 outlets, the co-operative movement reaches even the remotest areas of Europe. This presence allows for a close and unique proximity relationship with customers.

Modern and innovative banks upholding the traditions of the founding fathers of the co-operative movement like Raiffeisen and Schulze-Delitzsch: co-operative banks comply with the key principle of one person-one vote recognized in the European Co-operative Statute, at the same time complying fully with banking and co-operative legislation in their respective countries.

The Co-operative Banks Way

Sound business practices and resilient structures: co-operative banks generally have a high level of capitalisation, stable incomes from retail business and a diversified credit portfolio. Across Europe, they exceed the minimum legal capital ratio requirement of 8%, with an average ratio of about 9%. This is reflected in very good credit ratings, which range between AA- and AAA for the largest co-operative banking groups in Western Europe.

Efficiency and sound governance: members/customers are fully involved in the decision-making process of co-operative banks. Members control the co-operative and exert checks and balances at each level of the business, allowing organisations to minimise risk, identify creditworthiness and promptly respond to customers’ needs.

Citizens, Households and SMEs at the heart of the business: co-operative banks are the main lenders to SMEs. In Italy, France, Germany and the Netherlands, co-operative banks’ market share in loans ranges between 25% and 45%. In those same markets SMEs represent between 20% and 50% of the total client portfolio of co-operative banks*.

Job creators: with their wide-ranging networks, co-operative banks are often the main employers and taxpayers in their regions. Co-operative banks employ 750.000 people in Europe. In 2007 they created 13.000 jobs and devoted an average of 4% of the payroll to educational programmes.

Leading the way in the field of social

responsibility: co-operative banks emphasize the common good of society and foster self-help, responsibility and solidarity. They were historically founded to improve access to finance for their co-operative members who would have had otherwise limited access to finance at reasonable conditions. As a result of this philosophy co-operative banks participate in a range of schemes, such as microfinance and financial education of groups like for the long-time unemployed persons. They also have a long tradition of fostering the development of their local communities through cultural sponsorship initiatives, responsible citizenship and foundation activities. Co-operative banks are also among the market leaders for Socially Responsible Investment (SRI) products such as funds and savings accounts. Green finance is increasingly gaining importance and a variety of investment solutions allow the customers of cooperative banks to contribute to the preservation of the environment.