Do differences in stakeholder’s religiosity affect firms’ risk-taking?Evidence from the US credit unions

• Catholic credit unions take significantly less risk than their Protestant counterparts. • Our unique dataset of faith-based CUs avoids using geographical proxies. • Protestantism is not a monolith; risk appetites vary by denomination. While literature shows that religiosity reduces corporate risk-taking, the impact of differences among faiths remains an open question. Using manually-collected data on US faith-based credit unions, we examine this issue. We find that Catholic credit unions exhibit lower solvency risk, lower return volatility, and higher capital levels compared to Protestant credit unions. These differences also vary across Protestant denominations. Variations in solvency risk are driven by Mainline credit unions, while differences in return volatility are more pronounced among Evangelical and Black credit unions. Our findings show that specific religious doctrines, not just religiosity itself, shape firms’ risk-taking.