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total assets to other key areas, it is possible to detect changes in the balance sheet structure that could
have a positive or negative impact on earnings. The ideal goal for all saving and credit unions is to
achieve real positive growth (i.e., net growth after subtracting for inflation) each year. The result on
the sign of growth trends of total assets of Gohe cooperatives saving and credit union (Table 7),
indicates that the union was showing positive trends in total assets growth over the study periods still
as stated in the above key indicators the union faces the problem of keeping sustainable growth trends
in its total assets also. As to the real growth of the union the WOCCUs model proposed total assets
growth rate must be above the inflation rate and Gohe cooperatives saving and credit union performed
total assets growth in line with this proposed standard this entails the union was maintaining the real
value of the members’ assets and able protect from the impact of inflation.
Loan portfolio is the most important asset of rural saving and credit cooperative unions. Sign of growth
in total loan portfolio should keep the same pace of the sign of growth in the total assets. Lower
growth rate in loan portfolio relative to the growth in total assets implies the investment of funds in
less profitable assets and conversely the higher growth in loan portfolio signals good probability of
maintenance of profitability. Table 7, shows the sign of growth trends of Gohe cooperatives saving and
credit union in its net loans portfolio is not sustainable. In the year 1999 and 2001 it indicates positive
change in percentage i.e., 500.94% and 744.13% respectively whereas, in year 2000 the percentage
change is -71.33% which suggests lack of sustainable growth in loan portfolio and even the sign of
loan growth trend 1999 and 2001 is not going in the same pace as the sign of total asset growth trend.
As stated earlier the loan portfolio is the most important and profitable asset for saving and credit
cooperative union, If growth in total loans keeps pace with growth in total assets sustainably, there is a
good likelihood that profitability will be maintained in the union. Conversely, if loan growth trends
drop faces sustainability problems, this suggests that other less profitable areas are growing more
quickly than loan portfolio. In general, as we can see from the result Gohe cooperatives saving and
credit union has no the strategy to maintain sustainable growth trends in its loan portfolio in the same
pace as total assets growth trends so as to go up the union profitability.
Members savings are a source of funds with low financial costs i.e., interest costs, compared to other
commercial funds so that rural saving and credit cooperative unions should encourage members to
save and strives to attract new members by giving attractive interest and security on their saving. It is
often argued that small saving deposits entail high administrative costs that will turn rural saving and
credit cooperative unions into an unprofitable business for sustainable growth. Table 7 highlights the
sign of growth trends from 1998 to 2001 in the volume of saving deposits in Gohe cooperatives saving
and credit union. The fact that the total saving deposits grew by 7.96% in 1999; by 34.7% in the year
2000; and by 22.47% in the year 2001 Though, in the first two years the union able to show fast sign of
growth trends Gohe cooperatives saving and credit union couldn’t sustain this growth trends in the
year 2001 and declining percentage trends implies that Gohe cooperatives saving and credit union has
not been successful in both attracting new savers by giving attractive interest rate on their saving,
delivering modernize services, making the union more competitive and in convincing existing
members to increase their savings levels in the union which helps to finance members lending demand
from savings deposit from the union itself.
One of the essential tenants of saving and credit union philosophy is that saving and credit unions
should offer access to quality financial services to as many members as possible; due to the fact that
one of the key indicators of growth of RUSACCOs union is the number of member primary
cooperatives in the union. Membership growth of the RUSACCOs union is measured by number of the
primary cooperatives under the union over its operational years. Gohe cooperatives saving and credit
union has 17 primary cooperatives in the study years 1998 and 1999; 19 and 22 in the study year 2000
and 2001 respectively in number. Table 7, indicates the percentage sign of growth trends of the
primary cooperatives in the union which shows sustainable growth in membership of primary
cooperatives. Here the percentage sign of growth proposed by WOCCUs model is minimum 5% and
www.theinternationaljournal.org > RJEBS: Volume: 02, Number: 06, April-2013 Page 68