scholarly journals Exploring the Probability of Bankruptcy for Conventional Insurance Companies Listed at Kuwait Stock Exchange and its Effect on Their Share Prices

2019 ◽  
pp. 1341-1346
Author(s):  
Musaed S. AlAli ◽  
Yaser A. AlKulaib
Keyword(s):  
Stock Exchange ◽  
Financial System ◽  
Safety Net ◽  
Share Price ◽  
Insurance Companies ◽  
Financial Reports ◽  
Bankruptcy Risk ◽  
Insurance Sector ◽  
Financial Failure ◽  
Kuwait Stock Exchange

Insurance is a crucial component of any financial sector, the financial soundness of the insurance sector will result in a healthier financial system in any country. The insurance sector is responsible for transferring risk from one entity to another, for premium, to hedge against any risk of unexpected loss. For that, the insurance sector plays the role of safety net for the whole of the financial system in any country. This study aims to detect the existence of signs of financial failure for conventional insurance companies listed at Kuwait stock exchange (KSE). The study uses the Altman Model to calculate the financial failure indicators. The research also measures the relationship between the financial failure score and the share price of these companies. The analysis is based on the belief that financial reports provide information to investors which can be taken as indicators of the financial failure or success of companies. This information will affect investment decisions which, in turn, will be reflected on the share price. This study is based on the financial data of conventional insurance companies listed at Kuwait stock exchange for the period spanning from 2010 to 2017. A panel data collected from the financial statements of the four conventional insurance companies listed at the stock market were used to calculate the financial failure score for these companies. Ordinary least squared (OLS) regression method, is then used to evaluate the relation between Altman’s z-score and the share price of these companies. Results obtained from this study showed that conventional insurance companies operating in Kuwait had a healthy financial positions and therefore safe from bankruptcy risk. The study also revealed that there was no statistically significant relation between Altman’s score and the share price indicating that the financial failure score does not have an effect on share price of conventional insurance companies listed at Kuwait stock exchange.

scholarly journals Validity of Altman Z-Score Model to Predict Financial Failure: Evidence From Jordan

2018 ◽  
Vol 10 (8) ◽  
pp. 181 ◽  
Author(s):  
Sufian Al-Manaseer ◽  
Suleiman Al-Oshaibat
Keyword(s):  
Stock Exchange ◽  
Financial Statement ◽  
Insurance Companies ◽  
Z Score ◽  
Financial Reports ◽  
Financial Failure ◽  
Amman Stock Exchange ◽  
The Face ◽  
The Subject ◽  
Score Model

This paper aims to investigate the Validity of Altman z-score model to predict financial failure in insurance companies listed on Amman Stock Exchange (ASE) over the period 2011-2016. To achieve the goal of the study, the study depended on the different statistics analytical method and Multiple Linear Regression through doing the statistical analysis of the independent variables on the dependent variable related to the subject of the study through the (E-views) program in order to cover the analytical part of the study, in addition to the descriptive method through relying on books, periodicals, previous studies and financial reports of the insurance companies of the study’ sample, whether the direct or the indirect ones, to cover the theoretical part. The result of the study finds a high predictive power for Z-score model. Moreover, the findings reveal that Z-Score model could be valuable instrumental indicators for many users of financial statement such as financial managers, auditors, lenders, investors, to make right decisions in the face of financial failure.

scholarly journals Financial situation of insurance sector for example, a Stock – Exchange Company PZU

2014 ◽  
Vol 15 (1) ◽  
pp. 55-67 ◽  
Author(s):  
Paweł Trippner
Keyword(s):  
Economic Development ◽  
Financial Markets ◽  
Financial Institutions ◽  
Stock Exchange ◽  
Financial System ◽  
Insurance Companies ◽  
The European Union ◽  
Financial Systems ◽  
Insurance Sector ◽  
Financial Condition

Abstract The insurance system is a very important element of the financial system of a country. As institutions of public trust, insurance companies play a crucial role in the process of transforming savings into investments, which directly affects the country’s economic development. Maintaining the insurance sector in a good financial condition guarantees stability of the financial system and economic development of Poland. The article aims to present the essence of operations of insurance companies as financial institutions, present their role in the economy, and describe various methods of appraising their financial condition. In order to fulfil the above goals, a research hypothesis is put forward stating that the financial condition of the insurance sector in Poland deteriorated in the analysed period as a result of an adverse impact of turbulence in financial markets and problems in financial systems in the European Union countries.

scholarly journals Puratchi Thalaivi Amma’s Medical Insurance Scheme – A Boon for the Despondent Unorganized Sector - A Preliminary Case Study on The Penetration of Private Insurance Companies on the Unorganized Sector of Chennai City

2019 ◽  
pp. 35-44
Author(s):  
M. Mohan Kumar ◽  
Dr. P. Thiyagarajan ◽  
P. Sarvaharana
Keyword(s):  
General Public ◽  
Private Insurance ◽  
Safety Net ◽  
Vital Role ◽  
Insurance Companies ◽  
Insurance Sector ◽  
Rural And Urban ◽  
Chennai City ◽  
Unorganized Sector

The Insurance sector plays a vital role in the planned economic development, as it not only aims to boost saving habit; but also become a safety-net both for the rural and urban sector. It also aims to generate long-term funds for infrastructural development. Besides, Insurance protects enterprises against risks such as fire and natural calamities. For the general public insurance comes to their aid towards health care, life, property and pension. Therefore,insurance growth and development is synonymous to the growth of an economy wherein it not only safeguards the interest of the industry but the general public as well.

scholarly journals THE EFFECT OF THE FINANCIAL RATIOS ON THE SHARE PRICE OF INSURANCE COMPANIES LISTED IN THE IRAQI STOCK EXCHANGE MARKET USING MULTIPLE REGRESSION ANALYSIS (APPLIED RESEARCH IN THE IRAQI STOCK EXCHANGE MARKET)

2018 ◽  
Author(s):  
Othman Amin
Keyword(s):  
Multiple Regression ◽  
Stock Exchange ◽  
Multiple Regression Model ◽  
Share Price ◽  
Financial Ratios ◽  
Insurance Companies ◽  
Exchange Market ◽  
Share Prices ◽  
Research Population ◽  
The Relationship

<p><em>This research aims to identify the most important financial ratios affecting the share price of insurance companies listed in the Iraqi Stock Exchange Market (ISEM) during the period 2006-2015, and to indicate which ratios are more influential than others on share prices. The research population which consisted of (4 companies) is taken from insurance companies listed in the Iraqi Stock Exchange Market. The research sample consisted of one of these companies, representing  25% of the research population. In the statistical analysis a multiple regression model was used to determine the relationship between the independent and the dependent variables and the results of this study showed that there is a statistically significant relationship and effect between some financial ratios and the share price. The study gave a general background on the financial markets and the Iraqi Stock Exchange Market in particular.What characterizes this study from previous ones is demonstrating the effect of the financial ratios on the share price in the Iraqi setting for insurance companies listed in the Iraqi Stock Exchange using the multiple regression method.</em></p>

scholarly journals Insurance Sector Development and its Effect on the Financial Markets in Developing Countries: The Case of Kosovo

2020 ◽  
Vol 5 (1) ◽  
Author(s):  
Blerta Haliti Baruti
Keyword(s):  
Developing Countries ◽  
Financial Markets ◽  
Financial Stability ◽  
Research Question ◽  
Financial System ◽  
Insurance Market ◽  
Insurance Companies ◽  
Direct Role ◽  
Main Research ◽  
Insurance Sector

The purpose of this paper is to extract the important factors in the nature of insurance companies and their direct role in the economic and financial system development. This market study aims to analyse the insurance system in Kosovo by determining and then analysing its structure, the degree of concentration of insurance companies on the insurance market, their behaviour towards price, number of participants, companies operating in this market and types of products and services they provide. Our analysis are gathered on statistical and qualitative data through the study of the theories on insurance market development in other countries. Furthermore, for the empirical analysis, we used secondary data from Central Bank of Kosovo, Insurance Companies and Association Insurance of Kosovo. Also, we conducted two surveys. First, we conducted a survey with finance managers from all insurance companies and secondary survey was in general, for people who work. This way we tried to get a better understanding of the issue at hand.  The identification of these factors would enable insurance companies to design policies that tackle the demands of consumers for voluntary insurance policies and at the same time to contribute to financial stability of Kosovo’s economy. At the end we have to come out with conclusions on the main research question: Does Insurance Development affect the Financial Markets in developing countries? The expected outcome is that the insurance sector in Kosovo is an important factor for the further development of the financial system.

ANALISIS RETURN ON EQUITY DALAM MENILAI HARGA SAHAM PT. ASTRA INTERNASIONAL. TBK

PARAMETER ◽  
2021 ◽  
Vol 5 (2) ◽  
pp. 85-96
Author(s):  
Reni El Vionita
Keyword(s):  
Data Collection ◽  
Stock Prices ◽  
Stock Exchange ◽  
Financial Statements ◽  
Share Price ◽  
Descriptive Data ◽  
Financial Reports ◽  
Return On Equity ◽  
Equity Analysis ◽  
Qualitative Descriptive

This study aims to find out how return on equity in assessing the stock prices of PT ASTRA INTERNATIONAL Tbk listed on the Indonesia Stock Exchange. The method used in this study is a qualitative descriptive. Data collection tecniques used are the financial statements for the period 2014 to 2018. Based on the analysis and discussion of the research results it is known that company profits continue to experience this because income earnings are decreasing every year, and equity always increases due to income stock that continues to grow. Return on equity (ROE) at PT. Astra Internasional Tbk. From the calculation of return on equity analysis, in 2014 a percantage of 37,2% was obtained, in 2015 it decreased to 26,2%, and in 2016 the value of return on equity (ROE) again rosr to 24,9%, while in 2017 the vaule of return on equity (ROE) again rose to 25,6%, in 2018 it has again decreased to 22,8%. From these results it is stated that return on equity (ROE) of PT.Astra Internasional Tbk has decreased every year, but the share price continues to rise annually. Based on financial reports for 5 years, from 2014 to 2018 and besed on this research, it was found that return on equity (ROE) has a positive relatoinship with an avarage value of 27,3%, the rest is influenced by other factors beyond the calculation if return on equity (ROE) not discussed in this thesis.

scholarly journals Capital regulation and systemic risk in the insurance sector

2018 ◽  
Vol 10 (2) ◽  
pp. 237-263 ◽  
Author(s):  
Thomas Gehrig ◽  
Maria Chiara Iannino
Keyword(s):  
Systemic Risk ◽  
Banking Sector ◽  
Financial System ◽  
Solvency Ii ◽  
Insurance Companies ◽  
Capital Regulation ◽  
Content Type ◽  
Insurance Sector ◽  
Main Challenge ◽  
European Insurance

Purpose This paper aims to analyze systemic risk in and the effect of capital regulation on the European insurance sector. In particular, the evolution of an exposure measure (SRISK) and a contribution measure (Delta CoVaR) are analyzed from 1985 to 2016. Design/methodology/approach With the help of multivariate regressions, the main drivers of systemic risk are identified. Findings The paper finds an increasing degree of interconnectedness between banks and insurance that correlates with systemic risk exposure. Interconnectedness peaks during periods of crisis but has a long-term influence also during normal times. Moreover, the paper finds that the insurance sector was greatly affected by spillovers from the process of capital regulation in banking. While European insurance companies initially at the start of the Basel process of capital regulation were well capitalized according to the SRISK measure, they started to become capital deficient after the implementation of the model-based approach in banking with increasing speed thereafter. Practical implications These findings are highly relevant for the ongoing global process of capital regulation in the insurance sector and potential reforms of Solvency II. Systemic risk is a leading threat to the stability of the global financial system and keeping it under control is a main challenge for policymakers and supervisors. Originality/value This paper provides novel tools for supervisors to monitor risk exposures in the insurance sector while taking into account systemic feedback from the financial system and the banking sector in particular. These tools also allow an evidence-based policy evaluation of regulatory measures such as Solvency II.

scholarly journals ASSESSING THE IMPACT OF ACCOUNTING INFORMATION ABOUT COMPANIES ON THEIR STOCK QUOTES: AN EMPIRICAL ANALYSIS OF THE ACTIVITIES OF COMPANIES PARTICIPATING IN KUWAIT AND SAUDI ARABIA STOCK EXHANGES

2021 ◽  
pp. 5-14
Author(s):  
F. Rahal
Keyword(s):  
Market Share ◽  
Stock Exchange ◽  
Accounting Information ◽  
Share Price ◽  
Return On Equity ◽  
Share Prices ◽  
Listed Firms ◽  
Kuwait Stock Exchange ◽  
Equity Ratio ◽  
The Impact

Market Share Prices have important roles in determining the performance of the companies. Companies aim continuously to have a high market share prices for many goals. Therefore, understanding all variables that affect share prices is vital for investors. To examine if the Accounting Information affects market share prices, we studied the effect of some financial ratios determined from accounting statements on share prices for listed firms on Kuwait Stock Exchange and Saudi Stock Exchange. For Kuwait stock exchange, the quantitative methodology relied on the panel multiple regression through compiling and analyzing the Accounting Information and Market Share Price using secondary data for the period 2011 – 2018. The independent variables are Return on Equity (ROE), Earning per Share (EPS), and Dividend per Share(DPS) and the dependent variable is Market Share Price (MSP) of premier listed companies on Kuwait stock exchange. The analysis of the coefficient of correlation (R) shows that the correlation is very strong among DPS and EPS, DPS and ROE, EPS and ROE whilst it is strong among MSP and ROE, MSP and DPS, and EPS and MSP. Moreover, the variation of the three variables affects strongly the variation of MSP significantly on 1%. Therefore, there is a cause-effect relation between Accounting Information and MSP. Moreover, this paper examines the impact of return and leverage ratios on the Market Share Price of listed firms on Saudi Stock Exchange. The panel-data approach of fixed effect is used during the period of 2015 to 2018. To achieve the purpose of research return on equity as a proxy for profitability information, debt to equity ratio as a proxy for profitability ratio and natural logarithm of total assets as a proxy for the firms’ size are considered as dependent variables while market share price is considered as an independent variable. The results indicate that debt ratio and degree of financial leverage is negatively determining the share price while size has significant positive impact on the share. Debt to equity ratio is insignificant in effecting share price.

scholarly journals Modelling the Financial Failure of Romanian Stock Companies

2019 ◽  
Vol 7 (1) ◽  
pp. 65-82
Author(s):  
Gergely Fejér-Király ◽  
Norbert Ágoston ◽  
József Varga
Keyword(s):  
Present Article ◽  
Prediction Models ◽  
Stock Exchange ◽  
Financial Data ◽  
Financial Reports ◽  
Explanatory Variables ◽  
Independent Variables ◽  
Financial Failure ◽  
Outlier Data

Abstract The aim of the present article is to model and predict the financial failure of non-financial companies listed on the Bucharest Stock Exchange. The prediction models are based on the companies’ financial reports. The paper emphasizes the importance of processing outlier data and the significance of categorical independent variables. The paper contributes to bankruptcy and corporate financial failure research by presenting a Romanian situation. Results show that the model that uses 3-year financial data prior to the failure has a better accuracy. Several models have been compared, and it was found that using categorical independent variables as explanatory variables increased the accuracy of the models against those that used numerical regressors.

Managing adversity: understanding some dimensions of organizational resilience

2015 ◽  
Vol 38 (4) ◽  
pp. 346-366 ◽  
Author(s):  
Ihab Hanna Salman Sawalha
Keyword(s):  
Stock Exchange ◽  
Insurance Industry ◽  
Insurance Companies ◽  
Key Factors ◽  
Structured Interviews ◽  
Term Survival ◽  
Content Type ◽  
Insurance Sector ◽  
Quantitative And Qualitative Research ◽  
The Impact

Purpose – This study aims to explore how insurance organisations interpret organisational resilience; to identify potential objectives, elements and practices of organisational resilience within insurance organisations; and to investigate the impact of culture on resilience. Design/methodology/approach – An empirical study in the insurance industry in Jordan was undertaken. The population consists of all 28 insurance companies registered at the Amman Stock Exchange. Data were collected via a survey questionnaire followed by three semi-structured interviews. Findings – Results revealed that respondents understand the meaning of organisational resilience differently. Various factors constitute organisational resilience in Jordanian insurance organisations. Nevertheless, some key factors that have the potential to improve organisational resilience were missing. Culture influenced the level of organisational resilience considerably. Practical implications – This study provides insights into the factors that enable organisations to withstand future risks, which, in turn, ensures long-term survival. It also reveals how culture affects the level of organisational resilience. This paper provides a basis for policymakers in Jordan to start actively considering existing resources and cultural trends to introduce new frameworks for improving resilience in the insurance sector. Originality/value – This study is made in the context of an emerging economy; Jordan. It uses quantitative and qualitative research approaches. It is also one of the few studies to discuss resilience in relation to culture and within the insurance sector.

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