Banking System Stabilty: Commercial and Cooperative Banks
Banking System Stabilty: Commercial and Cooperative Banks

Summary/Abstract: Commercial banks and co-operative banks are credit institutions, but there are some differences between the main operations proceeded by each of them. Based on these specific characteristics, we want to identify the manner in which financial crisis affected their activity. As we all know, the financial crisis had a major impact in the United States, the “natal” country of the crisis, because great banks such as Lehman Brothers or Merrill Lynch have bankrupted. Even if the Romanian banking system was not affected by such catastrophic situations, surely the financial crisis had a significant impact on it. We found that cooperative banks are more stable than commercial banks. Even if there is a huge difference between the business scales of these two categories of banks, co-operative banks did not record any losses during financial crisis, while the commercial banks recorded huge loses especially in the second part of the period, 2011-2012. Even if, theoretically, a commercial bank has diversified activities compared to a co-operative bank, this does not mean that the risk is reduced.

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