Impact of Firm Specific Factors on Financial Performance of Life Insurance Companies in Nepal

2020 ◽  
Vol 1 (1) ◽  
pp. 39-52
Author(s):  
Janga Bahadur Hamal
Keyword(s):  
Financial Performance ◽  
Firm Size ◽  
Life Insurance ◽  
Stock Exchange ◽  
Explanatory Power ◽  
Secondary Data ◽  
Insurance Companies ◽  
Careful Examination ◽  
Specific Factors

The financial performance of life insurance companies determines the company’s ability to generate revenues and manage assets, liabilities and the financial interests of its stakeholders. However, there are limited studies discoursing major determinants of companies’ financial performance. To fulfill the gap, this study aimed to determine the effects of various firm-specific factors - firm size, liquidity ratio, short-term debt, long-term investment and firm age - on financial performance of life insurance companies in Nepal. The dependent variables influencing financial performance considered were return on assets (ROA) and return on equity (ROE). The study was based on secondary data of seven life insurance companies studied over a period of ten years, from 2009/10 to 2018/19. The data were collected from the financial statements published annually by the selected life insurance companies, Insurance Board of Nepal and Nepal Stock Exchange. In order to derive the impacts of firm-specific variables on ROA and ROE, descriptive statistics, correlation analysis and regression models were used. The study identified size and long-term investment to have negative and statistically significant relationship with financial performance. It also showed that higher the age of the company, the more difficult it will be to accumulate profit. The most influencing factors for the financial performance in Nepalese life insurance companies were firm size and long-term investment. Whereas, the explanatory power of liquidity seemed feeble. The findings elucidated that over-investment in long-term investments should be critically considered as it can have adverse effect on future profitability of the companies. Similarly, life insurance companies should increase their size only after careful examination over financial performance as it can result in diseconomies of scale and reduce the firm’s profitability.

scholarly journals Impact of Firm Specific Factors on Financial Performance: A Comparative Study of Life and Non-Life Insurance Companies in Nepal

2021 ◽  
Vol 4 ◽  
pp. 39-55
Author(s):  
Bhupal Jaishi ◽  
Resam Lal Poudel
Keyword(s):  
Financial Performance ◽  
Firm Size ◽  
Life Insurance ◽  
Stock Exchange ◽  
Insurance Companies ◽  
Debt Ratio ◽  
Return On Assets ◽  
Data Set ◽  
Tangible Assets ◽  
Specific Factors

The empirical research has been carried out to examine the firm specific factors composition and its impact on financial performance of life and non-life insurance companies in Nepal. This paper employs the descriptive as well as causal-comparative research design. The study comprises of a panel data set of 14 insurance companies listed in Nepal Stock Exchange (NEPSE) with 140 observations covering a period of 10 years from 2009/10 to 2018/19. The result exhibits that the insurance companies having a high debt ratio have better financial performance. It also reveals that a higher proportion of debt ratio and tangible assets increases return in assets. On the other side, a lesser proportion of equity, firm size and liquidity decreases the return on assets of the insurance companies in Nepal. The study raises understanding of impacts of firm specific factors on financial performance and provides an empirical evidence that the total debt ratio, equity to the total assets ratio, leverage, firm size, liquidity and tangibility are the significant factors in determining the financial performance of Nepal’s insurance companies. The non-life insurance companies tend to perform better in term of financial performance measured by earning per share and return on assets. The study leads to practical implications for insurance companies and regulatory bodies. The insurance companies of Nepal interested to improve their financial performance should focus on increasing their leverage and long-term investment and decreasing the proportion of equity, firm size and liquidity.

scholarly journals Capital Structure and Financial Performance of Manufacturing Companies in Indonesia

2021 ◽  
Vol 3 (2) ◽  
pp. 114-125
Author(s):  
Ni Luh Ira Suitri ◽  
Mohammad Agus Salim Monoarfa
Keyword(s):  
Capital Structure ◽  
Financial Performance ◽  
Stock Exchange ◽  
Secondary Data ◽  
Financial Statements ◽  
Manufacturing Companies ◽  
Analysis Method ◽  
Equity Ratio ◽  
The Capital Structure

This study aims to determine whether the Capital Structure affects the financial performances partially and simultaneouslly. The Capital Structure in this study is proxide by Debt to Asset Ratio (DAR) and Long Term Debt to Equity Ratio (LTDER), whereas the financial performance is proxide by Return On Asset (ROA). the type of data used in this study is secondary data obtained from the financial statements os plastic and packaging companies listed on the Indonesia Stock Exchange in 2012-2019. The analysis method uses multiple linier regression analysis. The result revealed that partially DAR had negative and significant effect on ROA, while LTDER had no significant effect on ROA. The result also shows that simultaneouslly DAR and LTDER have a significant effect on ROA.

scholarly journals Kinerja Perusahaan Tekstil dan Garment

2020 ◽  
Vol 21 (01) ◽  
Author(s):  
Darmanto Darmanto ◽  
Kun Ismawati
Keyword(s):  
Capital Structure ◽  
Financial Performance ◽  
Stock Exchange ◽  
Secondary Data ◽  
Company Performance ◽  
Analysis Technique ◽  
Equity Ratio ◽  
Quantitative Case Study

ABSTRACT: Bussiness competition in the textile and garment industry is now increasingly high, need to be managed properly, especially it’s financial performance. This study aims to determine the effect of capital structure on financial performance on textile and garment companies listed on the Indonesia Stock Exchange in 2016-2018 both partially and simultaneously. Capital structure is measured by Debt to Asset Ratio (DAR) (X1), Debt to Equity Ratio (DER) (X2), and Long term Debt to Equity Ratio (LtDER)(X3). Company performance is measured by Return on Investment (ROI) (Y). This research is a quantitative case study. Secondary data obtained from the annual financial statetments. The population of the research are 21 companies. The number of samples in this study were 8 companies. The analysis technique used is multiple regression to test the effect of independent variables on the dependent variable. The results showed that partially DAR and DER variables significantly influence the ROI, while the LtDER variable has no significant effect on ROI. All three variables have a significant effect on ROI simultaneousl.

scholarly journals Measurement of Financial Soundness of Life Insurance Companies in Bangladesh: An Empirical Study

2021 ◽  
pp. 29-43
Author(s):  
Dr. Razu Ahmed
Keyword(s):  
Life Insurance ◽  
Stock Exchange ◽  
Secondary Data ◽  
Capital Adequacy ◽  
Annual Reports ◽  
Insurance Companies ◽  
Financial Health ◽  
Financial Soundness ◽  
Depth Study ◽  
Z Scores

Purpose: The study strives to measure insurance companies’ financial soundness in Bangladesh with reference to private sector life insurance companies listed in the Dhaka Stock Exchange (DSE). Methods: CARAMELS ratio analysis and multiple discriminate analysis (MDA) have been employed to determine the results using secondary data sources collected from annual reports for ten-year DSE listed companies. Findings: The study identified a satisfactory capital adequacy ratio (CAR) with a decreasing trend. Reinsurance and actuarial ratio indicate that companies hardly participate in reinsurance. In most cases, all selected companies’ expense ratio during the study period is more than the standard (20 %) of the Insurance Development and Regulatory Authority (IDRA). All the selected insurance companies hold more liquid assets than the necessity. Z scores depicted that all the selected companies are potentially sick position in terms of financial health. Originality/Value: This study measured the financial soundness of life insurance companies in Bangladesh. No in-depth study was conducted in Bangladesh, particularly on measuring the financial soundness of life insurance companies.

scholarly journals Review on Insurance and their Present Status in Nepalese Economy

2020 ◽  
Vol 23 (1) ◽  
pp. 239-252
Author(s):  
Nirdosh Khanal
Keyword(s):  
Life Insurance ◽  
Financial Distress ◽  
Private Insurance ◽  
Secondary Data ◽  
Peak Level ◽  
Time Lapse ◽  
Insurance Market ◽  
Insurance Companies ◽  
Livestock Sector

The study aims to overview the types of insurance operating in Nepal, product delivered by them and status of insurance market in Nepalese economic development. The paper is based on secondary data and literature reviews. Insurance can be acknowledged as tool that shares risk, offers financial protection, minimizes the financial distress and accelerates the pace of economic growth. Insurance encourages saving in the society and collects the scattered fund in term of premium and invest for maximization. Presently 40 insurance companies (19 life insurance, 20 non-life insurance and 1 reinsurance) are operating in Nepal providing diversified range of services. Recently agriculture insurance on crop and livestock sector and health insurance policy is being offered through many governmental and private insurance companies of Nepal. Insurance Board statistics of 2017 revealed total premium of 46.97 billion rupees and 2.03% contribution in total gross domestic product. We cannot deny the fact that insurance market of Nepal is witnessing major obstacles in terms of new product innovation, service issues related to consumers and time lapse of long-term policy. The study concludes that with little improvisation based on market research and consumer awareness can lead insurance companies & the concept to a peak level in Nepal.

scholarly journals PENGARUH PROFITABILITAS DAN UKURAN PERUSAHAAN TERHADAP PENGUNGKAPAN TANGGUNGJAWAB SOSIAL PADA PERUSAHAN ASURANSI YANG TERDAFTAR DI BURSA EFEK INDONESIA

AKUNTABILITAS ◽  
2019 ◽  
Vol 12 (1) ◽  
pp. 69-80
Author(s):  
Amrina Rosyada ◽  
Fenty Astrina
Keyword(s):  
Social Responsibility ◽  
Firm Size ◽  
Stock Exchange ◽  
Secondary Data ◽  
Total Sample ◽  
Annual Reports ◽  
Insurance Companies ◽  
Insurance Company ◽  
Analysis Technique ◽  
And Performance

The purpose of this study is to analyze the effect of profitability and firm size on the disclosure of social responsibility on insurance companies as independent variables using profitability and firm size variables on social responsibility disclosure (CSR) as the dependent variable in company annual report, Respectively) and simultaneously (together). The sample that is the object of this research is all insurance companies listed on the Indonesia Stock Exchange in 2013 to 2016, the total sample for research four years of observation is 40 samples by using purposive sampling. The data used are secondary data from annual reports and performance reports of insurance companies that have been published. The data analysis technique used is multiple linear regression with the help of SPSS version 22. The results of this study are as follows, 1. Profitabilias Insurance company has a negative and insignificant effect on corporate CSR, 2. The size of the Insurance Company has a negative and significant effect on CSR. The results of this study provide information for companies about the level of disclosure of social responsibility owned by insurance companies, and also useful for providing information for decision making.

scholarly journals Pengungkapan Enterprise Risk Management dan Nilai Perusahaan: Peran Moderasi Umur dan Ukuran Perusahaan

2021 ◽  
Vol 31 (11) ◽  
pp. 2867
Author(s):  
Ni Kadek Ayu Asri Anggreni ◽  
Herkulanus Bambang Suprasto ◽  
Dodik Ariyanto ◽  
I Gusti Ngurah Agung Suaryana
Keyword(s):  
Risk Management ◽  
Firm Size ◽  
Firm Value ◽  
Stock Exchange ◽  
Secondary Data ◽  
Sampling Technique ◽  
Enterprise Risk Management ◽  
Annual Reports ◽  
Insurance Companies ◽  
Enterprise Risk

The purpose of the study was to obtain empirical evidence regarding the effect of enterprise risk management (ERM) disclosure on firm value with the role of age and firm size as moderating. The sampling technique used is purposive sampling technique. The data used in this study is secondary data obtained from the annual reports of insurance companies and financial institutions listed on the Indonesia Stock Exchange for the 2018-2019 period. The data analysis technique used moderated regression analysis (MRA). The results of the analysis show that ERM disclosure has a significant negative effect on the firm value of financing and insurance institutions. Firm age weakens the effect of ERM disclosure on firm value with a quasi moderator type of moderation. Firm size is not proven to moderate the effect of ERM disclosure on firm value and is a moderating predictor. Keywords : Firm Value; Enterprise Risk Management Disclosure;, Company Age; Company Size.

Reinsurance and Financial Performance of Non-life Insurance Companies in Ghana

2021 ◽  
pp. 0258042X2198994
Author(s):  
Charles Andoh ◽  
Susana Adobea Yamoah
Keyword(s):  
Life Insurance ◽  
Secondary Data ◽  
Insurance Companies ◽  
Panel Regression ◽  
Return On Assets ◽  
National Insurance ◽  
Timely Fashion ◽  
Jel Code ◽  
Solvency Ratio

The study examines how premiums ceded to a reinsurer affect the profitability of non-life insurance companies in Ghana. Secondary data on reinsurance ceded, combined ratio, assets, liabilities and return on assets for 20 non-life insurance companies over the period 2008–2018 were sourced from National Insurance Commission whilst interest and exchange rates variables were obtained from the Bank of Ghana. Panel regression model was employed for the analysis of the data collected. The results show that purchasing high levels of reinsurance alone does not affect the profitability of non-life insurance companies, but the combined effect of reinsurance and solvency ratio significantly impact their profitability. Managers of non-life insurance companies in Ghana should increase their ability to repay all financial obligations in the short, medium and long term in combination with reinsurance. This will enable insurers to stabilize growth, earn profits and meet their obligations to policyholders in a timely fashion. JEL Code: G22

Pengaruh Ukuran Perusahaan, Good Corporate Governance dan Efisiensi Operasi terhadap Kinerja Keuangan (Studi Kasus pada Bank BUMN yang Terdaftar di Bursa Efek Indonesia Tahun 2016-2020)

2021 ◽  
Vol 11 (1) ◽  
pp. 15-28
Author(s):  
Nona Jane Onoyi ◽  
Diana Titik Windayati
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Firm Size ◽  
Research Method ◽  
Stock Exchange ◽  
Secondary Data ◽  
Sampling Technique ◽  
Operating Efficiency ◽  
Good Corporate Governance

This study aimed to analyze the effect  offirm size, good corporate governance and operational efficiency on financial performance of banks (Case Study of State-owned Banks Listed on the Indonesia Stock Exchange 2016-2020 Period).  The research method uses a quantitative approach. The data used in this research is secondary data. The research sample was drawn using a saturated sampling technique, where all members of the population were used as samples, namely 4 state-owned banks. The results of the study partially show that the variables of firm size, good corporate governance and operating efficiency have a significant effect on financial performance. Simultaneously, the variables of firm size, good corporate governance and operating efficiency have a significant effect on financial performance.

scholarly journals The Effect of Capital Structure on Company Financial Performance

2020 ◽  
Vol 16 (2) ◽  
pp. 173-183
Author(s):  
Nini Nini ◽  
Dina Patrisia ◽  
Agus Nurofik
Keyword(s):  
Capital Structure ◽  
Financial Performance ◽  
Stock Exchange ◽  
Secondary Data ◽  
Manufacturing Companies ◽  
Short Term ◽  
Return On Equity ◽  
Book Value ◽  
Purposive Sampling

Abstract: This study aims to examine the effect of capital structure on the company's financial performance particularly in manufacturing companies listed on the Indonesia Stock Exchange for the 4 years period from 2014 to 2018. Capital structure is measured by Market Total Leverage (MTLEV), Market Long-Term Leverage (MLLEV) and Market Short-Term Leverage (MSLEV). On the other hand, the company's financial performance is measured by Return on Equity (ROE) and Price to Book Value (PBV). The populations in this study are manufacturing companies listed on the Indonesia Stock Exchange and the selection of samples was determined by purposive sampling method, with the final samples as many as 333 company-years. The type of data used is secondary data from IDX using multiple regression analysis methods. The results of the analysis show that the capital structure has negative and significant effect on the company's financial performance in each model.Keywords: capital structure, company financial performance Pengaruh Struktur Modal Terhadap Kinerja Keuangan PerusahaanAbstrak: Penelitian ini bertujuan untuk menguji pengaruh struktur modal terhadap kinerja keuangan perusahaan pada perusahaan manufaktur yang terdaftar di Bursa Efek Indonesia periode 2014-2018. Struktur modal diukur dengan Market Total Leverage (MTLEV), Market Long-Term Leverage (MLLEV) dan Market Short-Term Leverage (MSLEV). Sementara kinerja keuangan perusahaan diukur dengan Return on Equity (ROE) dan Price to Book Value (PBV). Populasi pada penelitian ini adalah perusahaan manufaktur yang terdaftar di Bursa Efek Indonesia. Sampel ditentukan dengan metode purposive sampling, kemudian sampel akhir diperoleh sebanyak 333 perusahaan-tahun. Jenis data yang digunakan adalah data sekunder dari IDX dengan menggunakan metode analisis regresi berganda. Hasil analisis menunjukan bahwa struktur modal berpengaruh negatif dan signifikan terhadap kinerja keuangan perusahaan disetiap model.Keywords: struktur modal, kinerja keuangan perusahaan 

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