An analysis of Risk management Strategies applied by Police CreditUnion for Investments
Most credit Union in Trinidad and Tobago are undergoing majorchanges. These changes are meant to enhance their image, improve ontheir services and operations and perform better. The police creditunion is one the unions that faces major challenges in respect tomembership satisfaction, services and product relevance and customerservice excellence. For long the police credit union for investmenthas remained financially stable in the country and it’s governed bylegislation and bylaws that changes as the union evolve.Nevertheless, with the advancement in technology today the Trinidadand Tobago police credit union for investment finds itself confrontedby risk on a day to day basis. The risk element that the Union isexposed to is found in all its operation phases. The police creditunion for investment over the years has suffered substantial lossesthrough robbery, embezzlement, liability claim and burglary. This inregardless of its size, nature of its common bond and location, thecredit union viability in some cases have been threatened by theimpact such losses can have on the members and general public in thecredibility of the credit union. Like any other business Trinidad andTobago police credit union is equally at risk to loss through fraudand error. With all said and done we get down to the basic questionof what kind of risk is the union exposed to?
Risk management is a term used to refer to a series of actions andprocedures that facilitates managers in pointing out, monitoring,assessing and addressing risk before they change into problems. It isa desirable thing to identify risk early before they turn to beingproblematic. After identifying risk a decision ought to be made aboutthe effect. A project manager ought to reduce the possibility ofuncontrollable event or mitigate the risk implementationconsequences. Thus, risk management ought to be manageable andstraightforward process. Substantial problems should not beencountered when implementing it. However, in union such as policecredit union the concept of risk still need to be introduced.Insurance defines Risk as exposure to injury or loss. In credit unionit is simply uncertainty of loss that is when loss is likely tooccur, its impact and cost. Credit unions in this case are faced bytwo kinds of risk the speculative and pure risk.
Pure Risk: hold on the likelihood of loss occurring throughconfiscation or destruction of the union assets. Moreover, theindirect losses may be suffered by the credit union. Loss bydestruction can arise by asset value reduction through flood, storm,civic commotion, fire or vandalism. While as, loss by confiscationcan occur through legal means that is the union being taken to courtfor issues such as negligence, damage or wrongful dismissal of staff.Or illegal means which involves armed hold up, robbery or burglary.This kind of losses is brought about by the outside parties. Internalfraud and embezzlement is the other area of substantial loss that areconducted by personnel working for the credit union. Such losses onlyoccurs when the individual have access records, assets andopportunity to conduct the crime.
Speculative risk holds on the uncertainty in assets management. Thepolice credit union main purpose is aid police and their family whoare members of the union to accumulate saving and use the pool ofsaved earning to give out loans to members. To do this there ought tobe a fine balance between sound business practices and credit unionphilosophy. It is the obligation of the credit union board to weighthe investment decision and the granting of loans against bad debtrisks that may impair the income and assets return needed to fund thedaily expenditure. The board thus takes speculative risk on everydecision that they make.
This study paper aims to analyze the risk management strategy that isapplied by the police credit union for investment in Trinidad andTobago. The paper will thus seek to answer the question whether inthe current regulatory and economic settings the risk managementstrategies can help police credit to attain profitability.
Objectives of the Study
Pointing out the major risk that face the police credit union in the country
Coming up with a contextual framework strategy that is employed by the police credit unions to mitigate investment risk
Analyze the aforementioned strategies based on qualitative approach and develop a plan whether the strategies have allowed the union to mitigate risks
To compare Police Credit Union Risk Limits to Industry Standards
To formulate the strategic plan for the implementations of the risk management policy and make necessary recommendations to enhance its strategies align to changing dynamics
The significant of this study is that by having a comprehensiveunderstanding on how to control and manage uncertainty that affectsthe daily business operations the police credit unions will beempowered to carry out efficient strategies meant to attainorganization goals especially in post financial crisis.
Trinidad and Tobago POLICE Service Credit Union was started in 1956at port of Spain police headquarters the plans were that all policemen and women become members. The aim of starting the union was tohelp police officers get loan since it was not possible for them todo so from lending institutions. The police ordinance protects thepolice from being sued thus financial institutions were reluctant tolend them money. Credit Union structure: the members hold the supremeauthority and members take part in voting on matters brought beforethem on annual general meeting. The company is headed by a board ofdirectors, supervisory committee, education committee, and executivecommittee who together are the base for the strong union structure.
Like any other Credit Union in the country Police Credit Union wasestablished as autonomous entity with its core business being topromote the growth of credit and offer members credit in accordanceto the credit union act and is regulated by the Central Bank ofTrinidad and Tobago. Problem statement: In the recent past the PoliceCredit Union Cooperative Society which is charged with the fiduciaryresponsibility of protecting its members’ deposit has had cases ofexposure to insolvency risk, unpredictable internal economicenvironment and proliferation of bad debts.
In light of this the research paper hopes to help the creditinstitution manage both the long term and short term risks.Furthermore, come up with better credit lending operations andincrease their investment. Lastly, help the Police Credit Union tocome with risk management strategy that will help them in identifyrisk, assess the risk, and mitigating risk.
Review of Literature
2:1:1what is a Lit Review?
The aim of this chapter is to address the current literature on riskmanagement strategies applied by police credit union for investmentthat is relevant to this study. Thus, it will concentrate on lookingat how the strategies have been effective in achieving profitabilityfor the union under the current regulatory and economic settings.
2:1:2what is Risk?
When writing about risk management both Alexander (2013) and chanceBrooks (2012) agree that organizations ought to be in a position ofidentifying risks and treats facing them. Moreover, the organizationsought to evaluate these risk and threats and apply a mitigationprocess aimed at reducing the risks. In this case comprehending thedifferent forms of risks credit union faces is of significant value.Credit unions are bestowed with the responsibility of safe guardingtheir member’s savings and in the process use this saving to investand generate profits. These investments exposes them to risk justlike the ones mentioned earlier in our example of the Hindu CreditUnion that collapsed as result of investing on business that wereoutside they normal operations. Investment risk is the possibility ofloss manifestation relative to the anticipated returns from theinvestment this is according to Fischer (2013) and Benes & Kumhof(2012). Burke (2013) explains an investment risk as a measure of themagnitude or uncertainty level of achieving the yields as per theinvestor’s prospects. As a result of these credit unions inparticular the Trinidad and Tobago credit union prefers to invest onless risky investment that do not yield high risks. Fischer (2013)agrees with Burke but notes that this does not mean zero risk becauseso long as there is investment, risks will always be there. Factorssuch as interest rates, inflation, taxes, market and exchangesdetermine the investment risks. Therefore, credit unions ought totake into account these factors when strategizing on how to managerisk.
2:1:3what is Risk Management?
When describing how risk management and quality management can belinked Perkins (2011) in his journal article, describes how firms canmove from reactive to proactive of controlling variances toeliminating sources of potential failure. According to this authorrisk management is the future of quality management. The writerargues that risk can be looked at in two dimensions as an opportunityor a danger. While addressing the same issue of risk Petrus (2014) inhis journal article addressing IT Risk Management, says that theparameters for risk should involve defining the external and internalenvironment. By observing these things the police credit union wouldbe in a position whereby they are able to bring satisfaction to theircustomers, become reliable and secure from internal and externalthreats.
Views (Guardian newspaper 2011) of Mr. Moore (Chairman of the CreditUnion League) and Mr. Pierre (stakeholder) claim the document doesnot take into consideration the size of the Credit Union investmentas amounts will differ as well as returns on these investments. Riskis a fact of life for financial institutions, it is Mismanagementwhich blemishes trust and tarnishes companies’ reputation. Theliterature also cites amongst the reasons for the failure of bankinginstitutions as being due to inappropriate lending practices, poorrisk management especially credit risk which may allow collateral tobe used for multiple loans or a high concentration of loans in onesector (Herrero,2003 De Juan, 2004 Bhatia, 2005).
2:1:4types of risk
Longenecker et al (2013) agrees with Bennet (2010) but disagrees withFischer (2013) who claims that investment comprises of business risk,liquidity risk, market risk, reinvestment risk, interest rate risk,call risk, inflationary risk, taxability risk, and legislative risk.Longenecker and Bennet assert that credit unions experience gaps informs of lending or credit risk, which involves the risk that aborrower will evade or default on a credit by failing to makepayments. In their report Boyd and Smith (2012) both asserted thatcredit unions face credit risks even from their members who are thestake holders. According to the two members of the union may defaultto pay the loans given to them which are a form of risk or faceconcentration risk that would results in large losses which wouldthreaten the union existence.
Lindsay (2009) describes the five steps that credit unions ought tofollow when addressing a potential risk: these are Assetidentification, vulnerability and threat assessment, riskdetermination, risk reduction, prioritizing and strategizing onidentified risk. Anette and Kaplan (2012) in their journal article anew flame work for risk management argues that risk should beclassified into qualitative distinction in order to for credit unionto create a risk management system that is effective.
Michael Stanley (2010) states that credit unions should take riskmanagement process as a continuous process. The system ought to bedesigned in manner that ensures they are more that risk identifies.They should be able to quantify and predict the impact of risk inorder to give results whether risk is acceptable or unacceptable.Steve Culp (2012) in his Forbes article explains why volatility anduncertainty in credit union might last longer than expected. Heoffers solution by saying a cost effective risk management should beused to prevent losses and increase productivity of the credit union.Davies (2014) explains that strategic risk management simply refersto concentrating on strategic assumptions, focusing on top risks thatfaces a company and prioritizing on business model.
Operational risk is one of the major threats to the police creditunion, this influences how operations are conduct. Lee and Kelly(2004) advised that the management ought to come up with a mechanismthat interlink with policies, procedures and processes to identifyrisks. The issue of obsolete technology is another cause of risk andbarrier to effective operation (Ghosh, 2012).Lastly, market and liquidity risk is another cause of alarm for theTrinidad and Tobago police credit union. Nevertheless, critics suchas Gosh (2012) still believe a lot is yet to be done main reasonthat the management is too dependent on external quarters and advicefrom outside rather than come up with a sound risk management system.In this case management ought to competently manage risk and put upmeasures eliminates risk associated with liquidity and markets(Bouteille & Coogan-Pushner, 2012).Byron (2002) in his view says that the minimum regulatory frameworkrequirement would be exceeded if the assets of the credit unioncoupled with the approach of liability management will show on therequisite risk associated with liquidity.
2:2:1 Strategic risk management and theories
Strategic risk management is the strategy an organization uses torespond to uncertainty and untapped opportunities. Moreover, itinvolves comprehending corporate strategy, the risk involved inadopting the corporate strategy and executing it. The sources of riskmay originate from within the organization or outside theorganization. Once the information about these risks is gathered thena strategic risk mitigation which is effective can be integrated.
According to Bessis (2011), and Power (2009), strategic riskmanagement as the deliberate actions, uncertainties or untappedopportunities that influence the strategy of an organization as wellas its execution. Moreover, Saunders and Allen (2010) and Brau andWoller (2004) assert that strategic risk management involves definingrisk tolerance by connecting it with outcomes and identifying thepossible causes of the negative outcomes. In addition, Rose andHudgins (2006) contend that strategic risk management allows theunderstanding of the probability of recurrence in these outcomes andthe measures, which one can use to mitigate the implications,reviewing them continuously and aligning bottom up management toenhance escalation process and tolerance. Human error and the degreeto which risk may be effectively managed may not be entirely due toan individual’s failing, but may be the result of a failure withinthe organization system, negatively influencing operations and taskperformance of the individual / team (Alexander 2013 Chance andBrooks 2012). In fact, Power (2009) and Drucker (2007) offer thatone can use the financial theory, new institutional economics,stakeholder theory, and the agency theory to provide a comprehensivedynamic on strategic risk management.
2:2:2 The Arbitrage Pricing Theory
This theory affirms that the return one expects from a monetary assetcan be offered as a linear utility of diverse hypothetical marketindicators and macro-economic aspects this is according to Patel(2005) and Pike and Neale (2006). Here, theorists assume that thefactors measured are susceptible to alterations, and that issignified by a dynamic-explicit coefficient. On the other hand, Quinnand Strategy (2013) assert that the Prospect Theory takes intodeliberation the options that come with uncertain implications of areturn. In this regards, Quinn and Strategy (2013) assert that themodel is evocative by character and tries to symbolize real-lifealternatives but not optimal resolutions.
2:2:3 The agency theory
The theory explicates the connection between agents and principals incommercial occupations or business aspects. The theory concerns withsolving difficulties that exist or can exist in the agencyconnection. In this regards, Power (2009) and Patel (2005) claim thattwo difficulties or problems exist in the relationship that isproblems that arise when the actors have different approaches towardrisk and when their desires conflict. Quinn and Strategy (2013)assert that conventional intellectual literature has utilized “limitsto arbitrage” premises to explicate why investment administratorsfail to eradicate the effects of shareholder or investor “illogical”partialities (either the behavioral finance or asset-pricingirregularities) on asset pricing. However, power (2009), Hull (2012),and Manuj and Mentzer (2008) demonstrate that managers involved inrisk management may not eradicate the pragmatic asset-pricingirregularities or anomalies because they may play a role in theirexistence. In this regards, Power (2009) and Hull (2012) assert thatif managers face restraints such as a “tracking-errorconstriction,” attached with the want to embrace liquidity tomanage investments actively, they favorably hold higher-instabilitysecurities in their range. Investment limitations, such astracking-error restrictions, nevertheless, diminish theprincipal-agent tribulations intrinsic in entrusted assetorganization and provide effective risk-control approaches.
Power (2009) and Drucker (2007) contend that investment managersunite a collection of alpha portfolio for a specified intensity ofliquidity with a prevarication portfolio intended to manage trackingerror. Liquidity coffers permit managers to or redistribute riskscompetently. As such, Hull (2012) assert that as the demand forliquidity increases, the outlay of maintaining the tracking-errorrestriction augments in that the managers must sponsor these demandsby trading lower-volatility securities and holding higher volatilitysecurities.
2:2:4leadership is theory
According to this theory leadership is on two-way communication wherea leader communicates and receives communication from his or herfollowers in terms of feedback. Collings and Mellahi (2009), Pike andNeale (2006) and Bessis (2011) assert that the communication approachimplemented in a business determines the kind of relationship betweenthe leader and the followers. As such, Bessis (2011) and Hardy (2003)say that the final factor revolves about the specificity of varioussituations. Arguably, not all situations are similar and themanagement style applied in one particular situation may notnecessarily work in another. Thus, good judgment is required inevaluating the kind of leadership required in a given situation.Still, situations affect the actions of a leader more than they do tohis or her traits (Collings and Mellahi 2009). This is because traitsdespite their stability over time have diminutive consistency acrossvarious situations. All this factors are in turn affected by amanagement’s relationship with his or her seniors, organizationalstructure and the skill pool at the disposal of the organization(Power 2009 Hubbard 2009 Haimes 2005 Christoffersen 2012).Overall, these factors form the basis for effective risk managementin modern organizations. The value of any organization is thediscounted back at risk adjustment rate, cash flows, and fundamentalsof business derivatives.
Quinn and Strategy (2013) assert that the role of a strategic riskmanager as the head of a given unit(s) has been defined and redefinedto stress on the need to guide rather than be a boss over the teammembers. To achieve this, McNeil, Frey, and Embrechts (2010) assertthat communication and organization structure must be molded in a waythat allows for cooperation and teamwork among all members of anorganization’s family. As indicated by various contemporaryresearch studies, the success or failure of an organization as awhole is highly dependent among on the time of leadership styleemployed (McNeil et al. 2010 Haimes 2005). The strategic riskmanager determines the commitment of the team players towards theachievement of set goal and objectives (Hull 2012 Hardy 2003).Following this line of argument, a leadership style can work tomotivate workers or to detach them from organization’s culture andlong-term goals. It therefore follows that good strategic riskmanagement is considerate of set goals, organizational culture andthe strengths and weaknesses of the employees.
Risk management = dependent variable
Different organizations apply different types of strategic riskmanagement this according to Manuj and Mentzer (2008). In someorganizations, two or more management styles are employed but theapplication of any kind of management style is dependent on thesituation at hand. Whichever the management style applied, it must bein line with an organizational culture (Patel 2005). Three universalprinciples apply for a good management style. First, transparency isvital for the success of any leadership style. It is highlyacceptable that 90 percent of a leader’s activity revolves aroundexecution while the rest 10 percent involves strategy (Quinn andStrategy 2013 Haimes 2005 Longenecker et al. 2013 Patel 2005).Whether it is execution or strategy implementation, communicationplays a vital role in determining the effectiveness of any adoptedline of leadership.
A good investment manager while keeping an eye on the key successfactors of an organization recognizes the need to safe guardlong-term interests of the company. Good planning, well formulatedstrategies and effective application of short term strategies are allimportant in ensuring the future success of an organization (Patel2005 Bennett 2010 Regester and Larkin 2008 Hardy 2003). Similarly,the ability of a leader to safeguard the talent pool in anorganization is crucial in sustaining the future of an organization.In this context, a leader must be able to nurture the leadershipskills in the organization to ensure continuity (Frosch &Nicholas 2009 Burke 2013). Successful companies in the modern worldhave established different training program for their seniormanagement as well as potential subordinates. This trend has enabledthe companies to keep a strong connection between differentsituational needs and available resources including the humancapital.
Instrumental values in this regard refer to beliefs about theappropriate behaviors for achieving set goals. Strategic riskmanagement requires one to adhere to strict values whetherinstrumental or end values (Patel 2005). Included here are honesty,imagination, loyalty, logic and politeness among others. On the otherextreme, Hubbard (2009), Haimes (2005), and Christoffersen (2012)define end values as beliefs regarding the type of goals to bepursued. The relationship between a leader and his or her followersis highly dependent on these values.
Strategic risk management can either be participative, authoritativeor delegative (Brau and Woller 2004 Regester and Larkin 2008).Participative risk management demands close relationship between amanager and his team. In this regard, a manager works alongsideother employees in completing strategic tasks (Collings and Mellahi2009 Nocco and Stulz (2006). The organization’s culture determinesthe effectiveness of participative leadership. On the other hand,Risk management is one of the key areas that any organization orinstitution should evaluate often (Holmes, 2002). The risk managementinvolves a six –step process that should be followed to the letternamely, the context of the risk, the realization of the risk, therisk analysis, and the risk evaluation and priorities, strategies andaction plan. Finally, it involves continuous monitoring and review toensure that a repeat does not happen.
2:3:1 Performance management
A risk management system is the sum total of all organizationmechanism the provides ground for planning employing, monitoring,appraising, and continually refining risk management processthroughout the credit union. In this case controls and systems referto a set of engagements intended to provide rational assuranceregarding the attainment of purposes concerning the efficiency andeffectiveness of processes, dependability of financial reporting, andacquiescence with all permissible and regulatory requirements (Weiss,2008). Therefore, credit union should design, apply, document, andmaintain risk management structure with governance engagements andcontrols and systems to allow the union to recognize, assess,quantify, observe, report, and manage investment and lending risks.
While writing on the issue Burke (2013) and Lyng (2005) affirm that acredit union system should incorporate processes, policies, andcontrols that offer passable, continuous, and timely identification,evaluation, quantification, management, reporting, and monitoring ofrisks. In addition, the union should document its lending andinvestment risk acceptance statement, setting out the enumeratedlevel of risk that the union is willing to accept. Additionally,Copestake (2007) asserts that aligning the goals of a risk managementwith its risk acceptance statement helps it to remain consistent insound operations, financial strength, and strategic objectives. Inthis regards, a risk management system should cover the riskmanagement policies and processes, risk register, controls andsystems, and reviews from the board of directors (Stevenson andHojati 2007, Tankov 2003 and Weele 2005). On the other hand, Boydand Smith (2012) contend that as suggested in all guidelines forfinancial institutions, a credit union requires a policy, which isvery significant in laying out the direction that a union shouldexecute in managing risk. In fact, all employees must adhere to theguidelines laid down in a policy paper to ensure compliance andeffective management.
Both Copestake (2007) and Patel (2005) agrees that an effectivepolicy is one, which is well understood and adhered to by allemployees of a credit union. In this regards, a policy that employeesdo not understand cannot become an effective policy plan for anyorganization. In a study conducted by Ketterer et al., (2011)reveals that credit unions in Trinidad and Tobago especially PoliceCredit Union and Eastern Union have developed policies aimed atimproving their risk management. However, Ogawa et al., (2013)argues that most credit unions in Trinidad and Tobago have failed toinstitute effective polices for the management of risk, which haveresulted to gaps in lending and investing.
2:3:2 performance and control system
There are different authors that have expressed their view thatcredit unions cannot manage risk effectively. This is because theylack a performance measure system that monitors the credit unionmanagement process Miller and Waller (2003) and Williams (2013).However, Williams (2013) suggest that credit unions do not havehigh-risk appetite because of prudential responsibility to clientsthat is they do not participate in actions that sustain a high levelof exposure to risk.
2:4:1 Methods of managing Risk
There are five methods used by credit unions these are compliance,scenario and sensitivity analysis, third party oversight, boardpolicy and sound rating system.
2:4:2 Compliance and oversight
A compliance committee is in charge of compliance issues of thepolice credit union ensures compliance of the credit union to allstatutory and regulatory requirements. Compliance with the laid downprocedures is an important aspect of risk management. The creditunion management must demonstrates strict compliance with the laiddown policy limits associated with risk through reporting to theboard (Etukuru 2011).
2:4:3 Scenario and sensitivity analysis
In sensitivity analysis, parameters of a model a tested withoutrelating the changes identified to a real world event with an aim ofdetermining which assumptions with most influences results of themodel. The credit union continuously evaluates the susceptibility ofportfolio segments faced by similar risk characteristics which mayinclude the types of investments, types of loans, collateral,geographic area, individuals, businesses or borrowers in a group.Hudson (2014) contend that changing economic conditions on quality ofassets net worth and earning of the union require the Trinidad andTobago police union to routinely perform scenario and sensitivitytests. This presents the union with the outlook by modeling futurepossibilities given an event or a series of events (Duffie andSingleton 2012).
2:4:4 Sound Rating Systems
The management of the credit union has gone a step further ofensuring that the rating of risks is objective, put intoconsiderations the variations in the borrower and loan behavior andsanctioned through a review function which is independent (Vine,2011 Hudson, 2014). It makes sure that the system is consistent withthe set standards of business practice (Horcher,2011).
2:4:5 Third Party Oversight
Examples of situations where the third parties are involved is whenmember loans need to undergo underwriting and safe keeping, buying ofparticipations in loans and safe keeping of investments (Beccalli etal., 2013). To ensure that the thirdparty oversight process is properly executed, the management of thecredit union issue many guidance letters concerning the subject.Williams (2013) contends that third party oversight is a major toolin managing risk especially in unions that have a high stake in theinvestment options.
2:4:6 Board Policy and RiskLimits: Comprehensive data and reports management
The board of directors of the Police Credit of Trinidad and Tobagohas established a policy, which discourses its ideology onconcentration risk, restricts commensurate with overall worthdegrees, and the logic as to how the bounds fit into the generalstrategic policy of the credit union. The parameters designed by theboard of the police credit union are explicit to each portfolio andit comprises bounds on loan categories, types of shares, exposure onthird party relationships. The risk limits have been designed insuch a way that they correlate to the general objectives of growth,financial goals, and net worth policy. The limits of the risks havebeen designed forth in the policy of risk concentration (Horcher,2011).
To sum up here are some of the regulations put in place by the Trinidad and Tobago central bank to control the police credit unions. Limit on borrowing by Credit Union – A credit union shall not borrow in excess of eight percent of the credit union’s total asset.
Maintenance of Minimum level of Institutional Capital – A credit union shall maintain a minimum level equivalent to eighty percent of total assets.
Maintenance of Minimum Level of Liquid Assets – A credit union shall maintain a minimum of fifteen percent of liquid asset in relation to total liabilities.
Approvals for investments may be approved by the Central Bank.
Interest from loans may not be included as income.
3:1 Type of Methodology Used
The method applied in this research is a quantitative approach.Quantitative data provide the basis for comparisons and analysis ofthe data collected. The data obtained is from secondary sourceswithin the course of the study. Quantitative method gives numericalunderstanding and insights that other methods cannot provide.Secondary research was preferred in this study instead of primaryresearch methods because it is more reliable in conducting studies ofthis nature. Conducting research of this nature may require time forcollecting primary data from different regions. Thus, analyzingalready collected data and presented discoveries will take less timeand still make the research more reliable.
3:2 Research Design
To discover or learn how the Police Credit Union manages risk forinvestment, the research favored an explanatory research design.Explanatory Research Design has a predisposition to focus principallyon the problem why? As such, the design examined tendencies as wellas associates performance or strategies of the organization underreview within a sector (Creswell, 2014). To appraise the phenomenaldevelopment of T & T (Trinidad and Tobago) within the CreditUnion Sector, more so, with concern to an incomparable and strongrisk management approach, the research practice integrated anExplanatory Research Design.
TheExplanatory design pursued clarifications as to whether the Union hasmanaged to develop strong risk management strategies and whetherother Unions have followed suit or they have dawdled behind. As such,experiential data assisted in underlining the requisite forelucidations as to the investigation problem (Robson, 2011).The research addressed the unpremeditated accounts for T & Testablishments’ efficiency in managing risk through spontaneousclarifications that will include uninterrupted, secondary, andcompound facets of the research problem (Guest, 2011). In addition,the research had a gradation of improbability so the evidences tendedto validate the deduction.
Quantitativeinvestigation, data gathering takes on several forms such asinterviews, cluster and discrete interviews and the examination ofthe existing literature. In this regards, the research identifiedethnography and case study as the major research approaches that itcultivated to study the risk management strategies employed. However,the huge chunk of the paper concentrated on surveys, questionnaires,and interviews to collect information.
3:4Sampling and Population
Samplesize depends on convenience, time, cost, and the intuitions of theresearcher (Guest, 2011 Feldman, 2004). For the appraisal of theunion, the research’s sample size entailed 60 participants. Indeed,the research considered the sample size adequate to provide conciseand accurate data. The partakers of the research, in this case,comprised 7 administrators and 10 risk surveyors from the union, 20frontline members of four teams, 10 auditors, and 10 financialanalysts. The research understood that the topographical spread wassmall thus, the research conducted staff surveys, face-to-faceinterviews, and questionnaires differently. Theresearch conducted self-administered discussions within the officepremises while the researcher handed the surveys and questionnairesto the partakers at the union’s platform and collect the firmswithin a period of one week.
3:5 Ethical Research and Consent Process
Tocreate awareness to the participants so that they can consent toparticipate in the research and be knowledgeable about the researchstudy I advertised through posters and word of mouth about thisresearch study. The participant were then issued with a consent formto fill in, this was not meant to bind them to the agreement but toshow that they willingly agreed to take part in the project.
3:6Instruments and Measurement
Inthis study, to clarify the strategies that the Police Credit Unionused to manage risk within its investment platform, the researchutilized ordinal measures of researchpositioned at interludes to sidestep deliberate information. Theimplication of the statistics composed formed the chief examinationof the exploration, which then integrated the usage of regression andcorrelation analysesPetty et al. (2012).Additionally, thestudy anticipated conforming to the social discipline MetaphysicalDogma that is positivism. Yin (2009) proposes that positivismunderlines a supposition that provides that researchers can makeinterpretations on social tendencies to comprehend binding knowledgethat is consistent. As such, positivism delivers an argument thatresearchers ought to constrict research to observable issues onlythrough human sanities.
3:7:1Research Strategy Methods
Thisresearch anticipated applying inductive study approaches byenchanting into deliberation interpretations of risk managementstrategies employed within the context of T & T Credit Unions.Afterwards, transmitted the explanations into a systematic designthrough which the research will create tentative hypothesis(Venkatramanand Ramanujam, 2010).The research then used the hypothesis to describe the philosophy withwhich the paper pursued to explicate the best strategies for riskmanagement.
3:7:2Quantitative and Qualitative Approaches
Thisstudy applied multiple methods both qualitative and quantitativeapproaches but took data gathering as two separate data arrangementsexamined characteristically over quantitative and qualitative methodsconsequently (Robson, 2011).Nevertheless, the quantitative approach provided the predominantportion of the research using administrative and self-administeredinterviews with the latter involving telephone, mailing, electronicmail, and internet platform while the former will use surveys. Thepaper found the quantitative method very significant in this casesince it can quantify information therefore, provide serious partsunder evaluation.
3:8Means of Data Collection
Inthis study, questionnaires and interviews formed the design part ofthe paper in a determination to appeal an all-inclusive deductiontowards the risk management strategies. In this situation, theresearch applied the quantitative method as the manner of datagathering integrating surveys and self-directed interviews.
3.8.1Self-administered Interviews and Questionnaires
Theresearch used an assortment of the partakers’ responses (PoliceUnion employees) to form the foundation for the study. Self-directedmethod utilized telephones, electronic mail, internet platform, andmailing. Furthermore, the researcher sent letters to the partakersencompassing a return correspondence address and mailing charges(disposition to participate). This is the more usually favored mannerfor directing discussions as it permits the examination ofpainstaking involvements, so preceding past of the partakers(Venkatraman and Ramanujam, 2010). In fact, such a styleallows the research to highlight new content that may complement theexisting literature. Self-directed interviews beset towards riskmanagement provided an extra benefit in instituting as to how theunion has managed to mitigate risk.
Moreover,the research identified a questionnaire as exceedingly designed tool,presenting the researcher with opinionated and structured responseswith respect to the participant’s assertiveness, performance, andaccurate information on a question. The surveys targeted employees ina determination to appreciate their involvements, consideration ofthe group`s culture and prospects on risk management. Thequestionnaire delivered serious valuation of the variables since thestudy will need partakers to answer problems that communicate thestand of the Union.
3.8.2Design of the Survey
Theresearch designed surveys to petition short written replies onattitudes and beliefs concerning risk identification and management.The reviews included both open and closed ended questions.Participants will fill the questions through the internet or in ahand transcribed format. The research considered workforce andadministrative facilities as highly important in data gatheringtowards the accomplishment of a rational and complete conclusionthus, it will hold participant information with the greatest mark ofdiscretion and confidentiality.
Thestrategy of the study was performed as the comprehensive summary ofthe whole learning as it defined the sequence and the technique toutilize to collect data particularly primary statistics. The studyconducted the reviews by using quantitative method thus, help incalculating unbiased facts using autonomous and reliant variables.Furthermore, the strategy of the review saw the parting of data fromconception, there afterwards scrutinize, and highlighted thedependability and cogency of the examinations. The study employed aquantitative technique to progress the premises that covered all theitems that empirically studied the statistics through SPSS,especially using a simple regression. After the reviews, the studywill investigate each variable carefully to define the connectionbetween the items and risk management strategies.
The research utilized processes of central tendency i.e. mode, mean,and median to define the fixed data composed through the quantitativemethod. The measures ascertained the dominant situations of the setstatistics to provide abridged statistics. Correlations and standarddeviations will provide the implication of the research. The R2or the constant of determination quantified the unit to whichcompliance and oversight, board policies and risk limits, soundrating systems, and third party oversight can explain the changes inquantity of risk within the investment platform of the union. TheP-value and t-statistic denoted the numerical implication of theitems utilized in the research. The research utilized simpleregression scrutiny in authenticating the conclusions of the study.In addition, it used computer techniques to categorize someconclusions.
A benchmark of 5% with a Cronback’s alpha of 95% specified that thepremise of the research will hold. The research grounded reliabilityand validity on the positivist model, which will also tested theinclusiveness of qualitative exploration. Venkatraman and Ramanujam(2010) assert that consistency as a notion assesses the grade ofexcellence in a specific study to create understanding results. Incontrast, cogency is a dependent concept that a researcher appliesrooted in meanings and chosen procedures of a study technique. Assuch, a researcher’s professional perception on the meaning ofvalidity determines the cogency of a research process. The researchsubjected the data composed from the partakers to acquiescence by anassessor to ensure submission to the resolve of the appraisal. Such apractice also helped to authenticate the accurateness of thecollected data to avoid compromising the conclusion of the research.
Thestudy encompassed numerous ethical deliberations to guarantee cogencyand submission to research philosophies throughout the whole study.Ethics expresses philosophies-defining specialized insights onvirtue, impartiality and decency(Venkatramanand Ramanujam, 2010).Thisstudy practice underlined the fact that the researcher treatedmaterial given by partakers with discretion, reverence and with theirdirect accord to ensure adherence to ethical aspects of a research.The study informed all partakers on the complete resolve of theappraisal and retained collected data securely. As such, theresearch utilized random selection and provided write-ups toparticipants that requested for their participation or failure,thereof.
3.10 Reliability and Validity
In the academic setting, reliability estimates the worthiness of datain answering a research question. A test-retest method ascertainedthe reliability of this study. The test-retest method determined thestability of the research discoveries from the onset of datacollection. I ensured a high degree of stability, which was anindication of a high degree of reliability. The research resultsascertained repeatable outcomes for another study of a similarnature. The use of the test-retest method was indispensable inprimary research, but it was equally valid for secondary datacollection. The collected data did not have any changes.
Validity was used to attain the study objectives. There were twokinds of validity used in this study the internal and the externalvalidity.
I explored the constructvalidity approach. The construct ascertained valid identification ofthe initial concept, question, hypothesis, or notion. This constructwas critical in making sure that the data gathered, as well as theapproaches used in the gathering process were of high value to theresearch. The recording and analysis of data were part of therightful approach to attaining validity. Valuable strategies,including the selection of precise research variables and theutilization of a uniform method to test the hypothesis, furtherascertained validity.
As identified in other works, external validity generalizes issues. I generalized the data to apply in other contexts. In this context,establishing a proper study design was vital in ensuring externalvalidity. The modern trends of globalization have challenged thechanges and its effects on emerging economies. The trends,therefore, make the application of results, obtained from one toanother, quite difficult.
Some ofthe limitations I expect to get when carrying out the researchinclude:
Ensuring that the respondent stick to the topic when responding to open ended interviews.
Time factor is another limitation I expect the research to have. The study requires a substantial amount of time for it to be completed in time and successfully.
The research topic is wide and hence cannot be fully covered. Additionally, it demands for substantial amount of time to be fully and successfully to be completed time is a limited resource and hence it is likely to limit the research process.
Lastly the researcher is limited to Trinidad and Tobago thus the researcher will not be able to acquire a holistic perspective of Risk Management Strategies.
DataAnalysis and Results
Thissection pursues to exemplify outcomes from the gathered data for thestudy, Ananalysis of Risk Management Strategies applied at the Police CreditUnion for Investments.
Theresearch derived gathered data from the quantitative explorationapproach using questionnaire surveys and used the data in theexamination of key outcomes revealed from the research. Theresearch-coded statistics from the qualitative technique grounded onproceedings assembled from semi-designed face-to-face interviews. Thesurveys or questionnaires utilized on the review entailed 30questions and a 5 grade Likert measure stretching from “(I)strongly agree to (V) strongly disagree.”
Participantscompleted and surrendered questionnaires, which enclosed queries onthe main features of respondents’ substances with respect to age,ethnic/race, and sex, among other features expressed to measure thegroup`s risk practices and business performance compared to riskmanagement. A single Likert measure had five accounts with the extrameasure totaled from one to ten the research required participantsto apply to a particular collection.
4.1.1Overview of the Findings
Riskmanagement strategies: The research applied four main variables thatexhibited the means through which the union manages its risks. Thevariables included compliance and oversight, board policy and risklimits, sound rating systems, and third party oversight. Based on thefindings, the study demonstrated that risk management is an importantaspect of any organization. According to the study, credit unionsshould implement risk scoring, auditing, and registers to recognizeand manage risks. In this regards, the study demonstrated theeffectiveness of risk management systems such as control andperformance systems in managing risks.
Occupationalperformance in regards to risk management: Here, the researchcompared how the company faired in areas where it applied thementioned risk management strategies. .The research evaluated these objects using linear regression processto advance on the accurateness of the exploration capacities. Inaddition, the study measured each of the item acknowledged in theresearch through a Likert measure of scale one to five.
InTable 1, below, the paper has numbered the items in respect to eachmeasure of the Likert scale, in conformity to Nunnally (2007)writing, consistency and the Cronbach alpha to display scaledependability found in relation to this study. This explorationmirrored a sensible magnitude of consistency at alpha> 0.70. TheLikert scale confirms that a good number of the participants thoughtthat the applied strategies by the organization bore fruits inmitigating risks. In addition, the collected demonstrates that theaforementioned strategies allowed the organization to streamlineoperations and mitigate risks.
Compliance and Oversight
Board Policy and Risk Limits
Sound Rating Systems
Third Party Oversight
Theresearch performed the descriptive analysis to underline further theprogress of issues that help in proposing clarifications as to theroles that different strategies play in mitigating different risksexperienced by the union. The research has used some of the factorsprovided in the suggestion and applied the Eigen value standard thathas provided the standard for extracting features (values> 1).Likewise, the research has adhered to the findings of Alexander andColgate (2009) and Hair etal,(2007) in implementing the factor examination with the four factorsselected to explain further the 60% of the overall variance. Theabstraction technique applied in the study involved the VarimaxRotation applied in line with Empirical Orthogonal and the principalaxis. Accredited to Kaiser, the method allowed the research tosimplify certain expressions in terms of variables without alteringthe actual coordinate system. As Alexander and Colgate (2009) andMalhotra (2004) assert, most researchers have accepted the method asa reliable technique for factor exploration designs. The researchapplied the Kaiser-Meyer-Olkin technique for the survey, whichrevealed a specimen tolerability level of 0.82, which the researchdeemed suggestively above the close suggested by Malhotra (2004) suchthat the study could factor the statistics efficiently.
Theresearch created these measures for risk practices to safeguard asubstantial factor load above 0.4 for examination. The researchloaded all the variables above 0.4 since it deemed the variablessignificant for the research. For the examination, the study brokedown the data as follows.
Theresearch has accomplished judgment founded, consequence focused, riskvaluations and management on credit unions in Trinidad and Tobago,but mostly important the risk management strategies that the PoliceCredit Union cultivates for investments. Section 4 of this paper haspursued to examine statistics gathered from quantitative andqualitative approaches using a multi method-approach. However, thissection aims to deliberate and deliver recommendations based on theoutcomes from the examination emphasized in section four for a strongrisk management policy.
5.2Discussions of key findings
H1:There is a significant association consistent between a sound thirdparty oversight and considerable reduction in risk.
The findings suggest a 80% strength in the utilization of third partyoversight as a strategy, which the management of the police creditunion has adopted. In addition, the suggestions on the effectivenessof the strategy and complementary developments with other strategiesreveal that the findings compare to other researchers. The researchdemonstrates that the use of sound third party oversight allows aunion to develop comprehensive mechanisms to manage risks. Inaddition, the study shows that the approach removes the burden ofmanagement from the union to a third party thus, the union achievesprudence in such matters.
Theresulting hypothesis suggests that there is a significant connectionbetween third party oversight and risk reduction. The p value 0032reflects that P< 0.05, which supports H1.
Examplesof third party oversights such as underwriting, safekeeping ininvestment, and purchase of partaking in loans allow a union tomanage risks effectively. The research identified third partyoversights as an effective strategy in managing risks, but only ifunions follow due diligence. On the other hand, the strategy does notrequire other collaborating features as a union can hire a thirdparty company with noteworthy and credible labor to execute suchmanagements.
H2:There is significant relationship between compliance and oversightand considerable reduction in investment risks.
The findings show that 75% of the participants likened the intenserisk management to compliance. The finding compares to the book ofliterature aforementioned, which reveals that the union has acompliance program that includes the compliance policy and complianceplan. A compliance committee is in charge of compliance issues of thecredit union ensures compliance of the credit union to all statutoryand regulatory requirements. The research shows that varying economicsituations on assets net worth, ROI, ROCE, ROE, and earning of theunion require the Trinidad and Tobago police union to performscenario and sensitivity tests. For example, analysis ofconcentration and impacts on earnings and capital due to liquidityand risks on interest rates in the rising rate environment.
Thestudy identified an R-value of 0.612, which suggests a significantcorrelation between compliance and oversight and risk reduction. Thestudy found a P value of 0.00 where P< 0.01.
From a commentary standpoint, the management should establishagreement with every board recognized-policy perimeter dealing withrisks and associated variables. Joseph (2013) reveals that mostunions have established compliance and oversight policies, but havefailed to execute such polices to the designed measures thus, unionsin T & T should implement policies established by the boardseffectively.
H3:There is significant relationship between sound rating systems andconsiderable reduction in investment risks.
A sound rating of 70% shows that the findings compares to otherfindings aligned to the study such as literature review, previousresearchers, and scenarios on strategies employed elsewhere. Thefinding reveals that it is crucial to make a precise, effective, andprompt system of risk rating capable of managing risk concentrationin the portfolio of a loan. Such a system allows the participationsof loans and in rare cases when the internal rating system is notavailable the establishment of a timeliness and diligent rating. With70% review, the study demonstrates that sound rating systems allow aunion to achieve the desired mechanism in managing risks.
Overall,there is a significant relationship between sound risk managementstrategies and considerable reduction in losses.
Afteranalyzing this suggestion, the research realized a significantnegative relationship between sound rating systems (independentvariable) and risk reduction (dependent variable). The R-value of0.574 highlights the notion that there exists a negative correlationbetween a sound rating system and risk reduction and is exhibited bythe value of P = 0.002 where p is less than 0.05 thus, the researchsupports hypothesis three.
The union usually examines the loan using its own system of internalrating. In the rare cases when the internal rating system is notavailable, the management of the police credit union does not makethe mistake of relying wholly on the system of the originatinginstitution. It has first to establish the timeliness and diligenceof that system. Examiners from the police credit union usually reviewthe documentation of the original institution and its consistence indue diligence. It makes sure that the system is consistent with theset standards of business practice.
6.1Implications of the study
CreditUnions in Trinidad and Tobago will find the outcomes from thisresearch valuable to understand how they can manage riskseffectively. The research discovered how unions in the regionimplement risk management strategies. In addition, it used the PoliceCredit Union as the standard for understanding the effectiveness ofthe risk management strategies that the unions apply. As revealed inthe research, the Unions have not managed to apply some strategieseffectively thus, they need to integrate the existing strategieswith other identified strategies.
6.2Effects of new regulations on investment
Thecentral bank of Trinidad and Tobago has proposed a number of issuescredit union need to follow in administering their duties and servingtheir members. These new rules if passed to law will lower loanportfolio or minimize the amount of loan issued to the members. Thisis because the central bank has put a number of rules need to befollowed before issuing a loan to any member of the union.
6.3Conclusions and recommendations
Risk avoidance is defined as a risk management method that aims ateliminating sign of risk via hazard prevention, or termination ofactivities evaluated to involve any degree of risk. Unwarranted riskcan harshly influence the monetary situation of a credit unionnegatively (Williams, 2013 Finlay, 2011). High absorptions in partsundergoing serious financial distress could end in momentous lossesbeyond a union’s net value. As such, it is the fiduciaryaccountability of the organization and administrators of creditunions to recognize, manage, screen, and regulate the threats thatthe unions experience. Examiners from the unions usually review thedocumentation of the original institution and its consistence in duediligence to make sure that the system are consistent with the setstandards of business practice. Managements should establishagreement with every board recognized-policy perimeter dealing withrisks and associated variables. Mohan and Zhang (2014) reveal thatmost unions have established compliance and oversight policies, buthave failed to execute such polices to the designed measures.
There exists several categories through whichthe Union assesses its CRR i.e. moderate, high, moderate, low orabove average with the direction of change usually assessed asstable, decreasing or increasing for a specified time frame. This ishighly dependent on the credit unions circumstances, economicenvironment, and the business (Wilson, 2013). Likeany other organization the credit unions develops a credit managementstrategy. Organizations spend many resources to ensure that thepotential risk is evaded. The initial stage in the management processis the development of the risk framework. The framework always givesthe idea of the specific areas where the risks are and may occur(Duffie and Singleton, 2012).
Structural changes have recently occurred in the credit unions givinga provision for a Compliance Officer, Internal Audit to CUs and RiskManagement Officer whose functions are designed to support the riskmanagement in all aspects of the Credit Union. In this regards, theunions need to have a thorough understanding on the issues thataffect their investment portfolio and how well they can manage suchissues or threats. The research has identified areas of concern,especially in regards to the Police Credit union of Trinidad andTobago, which has tried to manage risks effectively but weak systemsand laws continue to hamper such management.
Creditunions should regularly complete portfolio-level situation andsensitivity examinations to calculate the influence of fluctuatingeconomic situations on asset worth, incomes, and net value (MohanandZhang, 2014 Joseph, 2013).The studies should be multi-faceted to discover the consequence ofparticular and manifold simultaneous undesirable actions on thecollection. Finlay (2011) asserts that the complexity of situationand sensitivity studies should be dependable with the scope,intricacy, and risk features of the portfolio. In addition, creditunions should reflect on the vulnerability of selection sections withshared risk features to fluctuating market situations. Theboard and administration of a union should have triggers and exploitstrategies in writing for any substantial risk zone. If the union’schecking undertakings recognize concerns with a risk, the board mustreact consequently. Likewise, if an auditor trusts there may beraised risk subjects existing in a credit union, and theadministration has not appropriately computed and alleviated therisk, they must necessitate counteractive actions of administrationthat comprise, but not restricted to
Mounting the appraisal of the risk situation for the specific sector(s)
Execution of raised situation and sensitivity studies
Intensifying the appraisal of presentation of existing pledgers or investors
Appraising development and boundaries for new occupational lines and/or
Appraising risk extenuation selections and timeframes for lessening of threat, if obligatory (Mohan and Zhang, 2014).
Itis the duty of the unions to identify and apply comprehensivestrategies that respond effectively to external threats and financialshocks. The use of the identified Risk Management Strategies hashelped the union to reduce its risk portfolio but great care isneeded to ensure sustainability.
Alexander, K. (Ed.). (2013) Facilities management: theory andpractice. Routledge.
Alexander,N, and Colgate, M. (2009) “Retail financial services: transactionto relationship marketing”, EuropeanJournal of Marketing,34 (8), pp. 938-953.
Beccalli, E., Anolli, M., and Giordani, T. (2013)Retail Credit Risk Management,New York, Palgrave Macmillan.
Benes, J, and Kumhof, M. (2011) Risky bank lending andoptimal capital adequacy regulation. International Monetary Fund.
Bennett, P. (Ed.). (2010) Risk communication and publichealth. Oxford University Press.
Bessis, J. (2011) Riskmanagement in banking. John Wiley &Sons.
Bouteille,S, and Coogan-Pushner, D. (2012) TheHandbook of Credit Risk Management: Originating, Assessing andManaging Credit exposure,New York, John Wiley & Sons
Boyd,D, and Smith, R. P. (2012) Monetary policy, central banking andeconomic performance in the Caribbean. University of West IndiesPress.
Brau, J. C, and Woller, G. M. (2004)“Microfinance: A comprehensive review of the existing literature”,Journal of Entrepreneurial Finance, JEF,9(1),1-27.
Burke, R. (2013) Project management: planning and controltechniques.
Butler,K. C. (2012). Multinational Finance: Evaluating Opportunities, Costs,and Risks of Operations (Vol. 729). John Wiley & Sons.
Byron, S. C. (2002) A socio-economic profile of loan delinquency:a case study of a credit union in Trinidad and Tobago. TheSociety: St..Louis.
Caouette, J. B., Altman, E. I., Narayanan, P, and Nimmo, R.(2011) Managing credit risk: the great challenge for globalfinancial markets (Vol. 401). John Wiley & Sons
Chance, D, and Brooks, R. (2012) Introduction to derivativesand risk management. Cengage Learning.
Christoffersen, P. F. (2012) Elements of financial riskmanagement. Academic Press.
Chouthi, S, (2012, April 12) Eastern Credit Union bad loan rate downto 10.7%, The Trinidad Guardian Newspaper, Available athttp://guardian.co.tt/business-guardian/2012-04-12/eastern-credit-union-bad-loan-ratedown-107[Accessed 11 August 2014].
Collings, D. G, and Mellahi, K. (2009) “Strategictalent management: A review and research agenda”, HumanResource Management Review, 19(4),304-313.
Copestake, J. (2007) “Mainstreaming microfinance: socialperformance management or mission drift?”, WorldDevelopment, 35(10), pp. 1721-1738.
Creswell,J, W. (2014)Research design: qualitative, quantitative, and mixed methodsapproaches. ThousandOaks, SAGE Publications.
Douglas, R. (2010) CreditDerivative Strategies: NewThinking on Managing Risk and Return,New York, John Wiley and Sons
Drucker, P. F. (2007) Management challenges for the 21stcentury. Routledge.
Duffie, D, and Singleton, K. (2012) CreditRisk: Pricing,Measurement, and Management, Princeton,Princeton University Press.
ECU, (2012) Eastern Credit Union Newsletter, Eastern CreditUnion, Available athttp://www.easterncutt.com/images/Newsletter/Newsletter2014/Dec%202013%20issue2%20for%20web.pdf[Accessed 11 August 2014].
Ed Perkins. (2011). Linking Quality Management and Risk Management.Shifting from a reactive approach of controlling variances, toproactively eliminating potential sources of failure. Retrievedfrom:http://www.qualitydigest.com/inside/quality-insider-column/linking-quality-management-and-risk-management.html
Etukuru, R, (2011), AlternativeInvestment Strategies and Risk Management:Improve Your Investment Portfolio’sRisk-Reward Ratio, New York, iUniverse
Feldman, S. (2004) Credit unions. Hempstead, N.Y.: [HofstraUniversity].
Finlay, S. (2011) “Multiple classifier architectures and theirapplication to credit risk assessment”. European Journal ofOperational Research, 210(2), 368-378.
Fischer, G. (2013) “Contract Structure, Risk‐Sharing,and Investment Choice”, Econometrica, 81(3), 883-939.
Ghosh, A. (2012) ManagingRisks in Commercial and Retail Banking,New York, John Wiley & Sons.
Glen, K. (2008) TheCredit Union Movement of T & T, its origin, present status andpotential. MSc Thesis.
Goldberg, M., and Palladini, E. (2010) ManagingRisk and Creating Value with Microfinance,New York, World Bank Publications.
Guest,D, E. (2011) “Human resource management and performance: stillsearching for some answers”, HumanResource Management Journal,21(1),pp. 3-13.
Haimes,Y. Y. (2005) Risk modeling, assessment, and management (Vol. 40).John Wiley & Sons.
Hair,J, F, Anderson, R, E, Tatham, R, L, and Black, W, C. (2007)MultivariateData Analysis,5th ed., Pearson Education, Upper Saddle River, NJ.
Hansen,S. (2012) “Credit unions: an economic theory of a credit union”,TheJournal of Finance.
Hardy,M. (2003) Investment guarantees: modeling and risk management forequity-linked life insurance (Vol. 215). John Wiley & Sons.
Holmes, A. (2002). Risk management. Oxford, U.K.: CapstonePub..
Horcher, K. (2011) Essentialof Financial Risk Management, New York,John Wiley & Sons.
Hubbard, D. W. (2009). The failure of risk management: whyit`s broken and how to fix it. John Wiley and Sons.
Hudson, P. J. (2014) On the History and Historiography of Banking inthe Caribbean. Small Axe, 18(1 43), 22-37.
Hull. (2012) RiskManagement and Financial Institutions,+ Web Site(Vol. 733). John Wiley & Sons.
Hunseler, M. (2013) CreditPortfolio Management: A Practitioner’s Guide to the ActiveManagement of Credit Risks, London,Palgrave Macmillan
Joseph, C. (2013) AdvancedCredit Risk Analysis and Management, London,John Wiley & Sons
Katwaroo-Ragbir, S, (2013) “The Role of Regulation in theDevelopment of the Trinidad & Tobago Microfinance Sector”,Journal of Emerging Trends in Economics & Management Sciences,4(2).
Ketterer, J. A., Stevenson, C., Iwasa, M., Abuelafia, E, and Terán,A. (2011) Trinidad and Tobago: Financial Sector: Sector Note (No.79861), Inter-American Development Bank.
Knorr Cetina, K, and Preda, A. (2004) The sociology of financialmarkets. Entrepreneur journal. Oxford University Press.
Kodilinye, G., and Kodilinye, M. (2013)Commonwealth Caribbean Contract Law,London, Routledge Publishers
Lee,F, and Lee, F, (2007) Therelationships between HRM practices, Leadership style, competitivestrategy and business performance in Taiwanese steel industry,Proceedings of the 13th Asia Pacific Management Conference,Melbourne, Australia, 2007, 953-971.
Lee, J., and Kelly, W. (2004) Who uses credit unions? (3rded.). Madison, WI: Filene Research Institute.
Lyndsay Wise.(2009). Addressing Risk In Organizations. DashboardInsight. Retrieved From:http://www.dashboardinsight.com/articles/digital-dashboards/fundamentals/addressing-risk-in-organizations.aspx
Longenecker, J, Petty, J, Palich, L, and Hoy, F. (2013) Smallbusiness management. Cengage Learning.
Lyng, S. (Ed.). (2005) Edgework: The sociology ofrisk-taking. Psychology Press.
Malhotra,N, K. (2004) MarketingResearch: An Applied Orientation,Pearson Education Inc, Upper Saddle River, New Jersey.
Manuj, I, and Mentzer, J. T. (2008) “Globalsupply chain risk management”, Journalof Business Logistics, 29(1),133-155.
Mark Davis. (2014). Strategic Risk Management: Integrating Risk withBusiness Strategy and Planning. Deloitte. Retrieved From:http://www2.deloitte.com/us/en/pages/dbriefs-webcasts/events/june/dbriefs-strategic-risk-management-integrating-risk-with-business-strategy-and-planning.html
McNabb,D, E. (2013) Researchmethods in public administration and nonprofit management:quantitative and qualitative approaches,Armonk, NY: M.E. Sharpe.
McNeil, A. J, Frey, R, and Embrechts, P. (2010)Quantitative risk management: concepts,techniques, and tools. Princetonuniversity press.
Meyer, J, P, and Gagné, M. (2008) “Employee Engagement from ASelf-Determination Theory Perspective”, Industrial andOrganizational Psychology, 1(1), pp. 60-62.
MichaelStanleigh. (2010). Risk Management…the What, Why, and How. BusinessImprovement Architect. Retrieved From:http://www.bia.ca/articles/rm-risk-management.htm
Miles,M, B, and Huberman, A, M. (2004) Qualitativedata analysis: An expanded sourcebook,Thousand Oaks: Sage.
Miller,K. D, and Waller, H. G. (2003) “Scenarios, real options andintegrated risk management”, Long Range Planning, 36(1), 93-107.
Mohan,N. and Zhang, T. (2014) “An analysis of risk-taking behavior forpublic defined benefit pension plans.” Journalof Banking & Finance,40,403-419.
Nocco, B. W, and Stulz, R. M. (2006) “Enterpriserisk management: theory and practice”, Journalof Applied Corporate Finance, 18(4),8-20.
Nunnally,J, C. (2007) PsychometricTheory.2nd Edition, McGraw Hill, New York, NY.
Ogawa, M, S, Park, M, J., Singh, M, D, & Thacker, M, N. (2013)Financial Interconnectedness and Financial Sector Reforms in theCaribbean (No. 13-175), International Monetary Fund.
Pamuk, A. (2000) “Informal institutional arrangements in credit,land markets and infrastructure delivery in Trinidad”, InternationalJournal of Urban and Regional Research, 24(2), pp.379-496.
Patel, C. C. (2005) Catastrophemodeling: a new approach to managing risk(Vol. 25). P. Grossi, & H. Kunreuther (Eds.). Springer.
Petrus Human. (2014). How some of the best IT departments areaddressing IT Risk Management. Attix 5 Data Protection. RetrievedFrom:http://www.attix5.co.uk/thought-leadership/how-some-best-it-departments-are-addressing-it-risk-management.
Petty,N, J, Thomson, O, P, and Stew, G. (2012) “Ready for a paradigmshift? Part 2: Introducing qualitative research methodologies andmethods”, ManualTherapy-17(5),pp. 378-384.
Pike, R, and Neale, B. (2006) Corporatefinance and investment: decisions & strategies.Pearson Education.
PoliceCredit Union. (2014) Available at http://www.policecreditunion.com/[Accessed 11 August 2014]
Power, M. (2009) “The risk management ofnothing”, Accounting, Organizationsand Society, 34(6),849-855.
Quinn, J. B, and Strategy, E. S. (2013).“Strategic outsourcing: leveraging knowledge capabilities”,Image.
Regester, M, and Larkin, J. (2008) Risk issues and crisismanagement in public relations: A casebook of best practice.Kogan Page Publishers.
Robert S. Kaplan and Anette Mikes. (2012)Managing Risks: A NewFramework. Harvard Business Review. Retrieved From:https://hbr.org/2012/06/managing-risks-a-new-framework
Rose, P, and Hudgins, S. (2006) Bankmanagement and financial services. TheMcGraw− Hill.
Robson, C.(2011) Realworld research.3rded., Chichester: Wiley.
Sang,C. (2010) Relationshipbetween HRM practices and the perception of organizationalperformance, roles of management style, social capital, and culture:comparison between manufacturing firms in Cambodia and Taiwan,National Cheng Kung University, Taiwan, Taiwan.
Saunders,A, and Allen, L. (2010) Credit risk management in and out of thefinancial crisis: New approaches to value at risk and other paradigms(Vol. 528). John Wiley & Sons.
SteveCulp. (2012). Supply Chain Risk a Hidden Liability for ManyCompanies. Forbes Journal Retrieved From:http://www.forbes.com/sites/steveculp/2012/10/08/supply-chain-risk-a-hidden-liability-for-many-companies/
Stevenson,W. J, and Hojati, M. (2007) Operations management (Vol. 8). Boston:McGraw-Hill/Irwin.
Tankov,P. (2003) Financial modelling with jump processes. CRC press.
Thomas,L. C. (2000). “A survey of credit and behavioral scoring:forecasting financial risk of lending to consumers”, InternationalJournal of Forecasting,16(2), pp. 149-172.
Tokle,R., and Tokle, J. (2013) “Is This an Appropriate Issue for theBoard of Directors at a Credit Union to Consider?”. Journalof Critical Incidents,6,156.
Venkatraman,N, and Ramanujam, V. (2010) “Measurement of Business Performance inStrategy Research: A Comparison of Approaches”, Academyof Management Review vol. 1(4) pp. 801-814.
Vine, S. (2011) Options:Trading Strategy and Risk Management,New York, John Wiley & Sons.
Weele, A. J. (2005) Purchasing & supply chain management:analysis, strategy, planning and practice. London: Thomson learning.
Weiss, J. (2008) Business ethics: a stakeholder and issuesmanagement approach. Cengage Learning.
Wheelock, D. C., and Wilson, P. W. (2011) “Are credit unions toosmall?”. Review of Economics and Statistics Journal, 93(4),1343-1359.
Williams, E, S. (2013) “INTERNATIONAL AND NATIONAL ECONOMIES,”World Banking Abstracts, 29(6), 444.
Yin,R, K. (2009) CaseStudy Research. Design and Methods,Thousand Oaks: Business Journal. Sage.