French Mutual Banking Groups Ten Years After the Financial Crisis: Lessons and Observations

More than ten years ago, the so-called "sub-prime" crisis in the United States has turned into a global systemic crisis, which has destabilized the entire banking system. The resulting mistrust in banks has rekindled interest for diversity in legal and organizational forms of financial institutions. Conversely, this financial turmoil has revealed the systemic risk resulting from a process of convergence towards the single model of joint-stock bank. For this reason, cooperative banks have gained in credibility, especially because they have shown a better resistance to this crisis. However, this general conclusion masked some differences: huge losses affected the French cooperative banks, which have transformed into large universal banking groups after experiencing a strong hybridization process. This article aims to depict, ten years later, the situation of the three French cooperative banking groups, compared to the main French joint-stock banks listed on the stock-market (BNP Paribas and Société Générale). We first recall how the hybridization process, considered as a source of performance before 2008, has turned into a weakness, and how the French cooperative banks have reacted afterward. In the second part of this paper, we perform a comparative analysis using usual financial analysis statement and ratios, in order to better understand the importance and the role of the French cooperative banking groups.