한국생산성학회

The global economy has stagnated due to COVID-19, and the era of low-interest rates continues due to changes in the benchmark interest rate. As liquidity increases due to continued low-interest rates, real estate prices rise and loans are increasing accordingly. Increased loans lead to increased profits, but insolvent loans cause large losses in financial institutions and reduce profits, negatively affecting management efficiency, so it is necessary to find ways to minimize the negative impact of bad debts and expand normal loans. The purpose of this study is to measure the inefficiency of bad loans using various directional distance functions and find a desirable direction, centering on Shinhyup in Busan and Gyeongnam, which have the highest delinquency rate in the country. Based on the fact that various directions can be given, which is an advantage of the directional distance function, five directional vectors are used to measure the inefficiency of each shape of the directional distance function. In addition, the inefficiency of local credit unions and organizational credit unions is measured, and the inefficiency is measured according to the asset size and the number of members. Finally, the effect of changes in normal and bad loans on inefficiency, that is, the sensitivity of efficiency, is measured. This study is different from previous studies in that it studied the Credit Union by measuring directional distance efficiency that gave five different directions to the increase in normal loans and the decrease in bad loans. According to the empirical results, first, it was most efficient when the ratio of increase in normal loans and decrease in bad loans remained at 3:1, so it seems desirable to increase normal loans and further reduce bad loans. Second, when comparing regional credit unions and collective credit unions, regional credit unions were found to be efficient in the same way as Busan and Gyeongnam. This means that small group credit unions are more inefficient than local credit unions when bad loans occur depending on economies of scale. Third, when comparing Busan and Gyeongnam organizational credit unions, Busan was found to be more efficient. This is because Busan includes many group credit unions consisting of members with high income and excellent creditworthiness. Fourth, in the sensitivity analysis of efficiency, it was confirmed that a union with high efficiency performance obtains better results when it attempts to increase normal loans and improve poor loans. Therefore, a strategy to improve the performance of the union is needed. Each union needs to continue to find safe and creditable loans and carefully manage bad loans. In addition, it is necessary to establish a strict management system for credit unions where bad loans frequently occur and to apply flexible management to sincere unions.