한국생산성학회

With the prospect of negative growth in the economy due to the prolonged spread of COVID-19 around the world, we are continuing to cut the base interest rate. The cut in interest rates will deteriorate the profitability of financial institutions and have side effects. The main source of income for financial institutions is the loan-to-deposit margin. The credit union's loan-to-deposit margin at the end of 2009 was 3.60%, but at the end of 2019, the loan-to-deposit margin continued to decrease to 2.42%. The global economic recession and a cut in the base interest rate will lead to a decrease in the credit union's loan-to-deposit margin, which will greatly affect the management performance of individual unions. In order for individual unions to survive in such a difficult environment, it is necessary to increase the loan-to-deposit margin, but it is also very important to minimize non-performing loans, which have the greatest impact on management performance. While the loan market has shrunk due to the government's household loan regulation, credit union loans have been concentrated on high-risk loans, resulting in an increase in delinquency rates. In particular, the delinquency rate in Busan and Gyeongnam area continues to rise. The purpose of this study is to measure the meta-efficiency of non-performing loans using a meta-frontier model targeting the three type unions within credit unions in Busan and Gyeongnam areas, and to decompose this internally into technology efficiency and technology gap. Technology efficiency is measured by comparing observations within the same union group, and technology gap is measured by comparing different union groups. In this study, when estimating individual group frontiers, meta frontiers, and pooling frontiers from the point of view of a theoretical model, stochastic frontier analysis (SFA) and the cost function type are used. This is different from previous studies. According to the empirical results, first, the meta-efficiency was lower than that of the technical efficiency, so there are technology gaps among three union groups. The efficiency levels that occur within the three union groups are significantly different from each other, and the technology gap among them are also found to be quite large. Second, in terms of technology efficiency, the organization union was the lowest compared to other unions. However, the organization union was the highest in the technology gap. This means that the group frontier closest to the meta frontier is the organization union. Third, looking at the yearly average change, it suggests that region union and workplace union show a form of deteriorating non-performing loan efficiency over time. The policy implications are as follows. In the current economic downturn, it is necessary to convert loans to safe assets. It is also necessary to switch to small-scale and household loans rather than corporate or large-scale loans, and to organization unions of stable occupations with high trust or stable workplace unions. The digital transformation of the financial sector is progressing rapidly. To keep up with this, training of internal staff is important, but it is necessary to build digital finance faster through outsourcing or collaboration with external institutions that are leading digital finance.