The Impact of Macro Economics on Firm Values and Financial Performance as an Intervening Variable: An Empirical Study of LQ-45 Banking Industries in Indonesia

2015 ◽  
Vol 3 (1) ◽  
pp. 88-94
Author(s):  
Indra Siswanti ◽  
Eko Ganis Sukoharsono ◽  
Embun Prowanta
Keyword(s):  
Exchange Rate ◽  
Central Bank ◽  
Exchange Rates ◽  
Financial Performance ◽  
Firm Value ◽  
Return On Assets ◽  
Bank Rate ◽  
Direct And Indirect Impacts ◽  
Indirect Impacts ◽  
The Impact

Objective - The Purpose of the paper is to empirically investigate both direct and indirect impacts of the macro economy, which are Exchange Rates, Inflation, Central Bank Rate, as independent variables, on Value Firms (Price to Book Value), as a dependent variable, and its Financial Performance (Return on Assets), as an interning variable. Methodology/Technique - The study uses a path analytical method of the SPSS for determining a strong causal relationship between the independent variable and the dependent variable either directly or indirectly. Findings - The paper finds that Exchange Rate does not impact on ROA; Inflation negative significantly impacts on ROA; Central Bank Rates positive significantly impact on ROA; ROA does not impact on PBV; Exchange Rate negative significantly impact on PBV; Inflation does not impact on PBV; Central Bank Rate does not impact on PBV; ROA does not mediate its impact of Exchange Rates on Firm Value (PBV); ROA does not mediate its impact of Inflation on Firm Value (PBV) Dan ROA mediate its impact of Central Bank Rates on Firm Value (PBV).. Novelty - The paper uses corporate performance (Return on Assets) as an intervening variable to test the indirect effect on firm values (PBV). Type of Paper - Empirical Keywords: Exchange Rates, Inflation, Central Bank Rates, Return on Assets and Firm Values (PBV)

scholarly journals Financial Performance, Exchange Rate, and Firm Value: The Indonesian Public Companies Case

2020 ◽  
Vol 11 (22) ◽  
pp. 348-366
Author(s):  
Yulita Setiawanta ◽  
Dwiarso Utomo ◽  
Imam Ghozali ◽  
Jumanto Jumanto
Keyword(s):  
Exchange Rate ◽  
Capital Structure ◽  
Financial Performance ◽  
Firm Value ◽  
Market Value ◽  
Observation Data ◽  
Moderation Effect ◽  
The Exchange Rate ◽  
The Impact ◽  
The Capital Structure

Transactions between countries require a stable exchange rate. When the exchange rate of the country experiences uncertainty, then this will influence the company’s financial performance and even affect the company’s market value. This study aims to look for the direct influence of the company’s financial performance as an independent variable and the firm value as a dependent variable within the investor perspective, also including the exchange rate factor as a moderating variable. Investors could probably learn about information on the ups-and-downs of the Indonesian rupiah against foreign currencies before their investment decisions, even though financial performance substantially influences the company’s market value. The sample in this study was 50 companies within four years of observation. Data processing was carried out by the Eviews statistical application. The results showed that the financial performance, which is proxied by the capital structure, affects firm value, but not profitability. The impact of exchange rate moderation also occurs in the relationship of capital structure and firm value, while the moderation effect on profitability and firm value is not proven. This study provides information that exchange rates influence investment interests upon investors’ analysis of the financial performance of the capital structure, but not profitability.

scholarly journals The Impact of Exchange Rate Movements on Firm Value in Visegrad Countries

2017 ◽  
Vol 65 (6) ◽  
pp. 2105-2111 ◽  
Author(s):  
Jana Šimáková
Keyword(s):  
Exchange Rate ◽  
Exchange Rates ◽  
Firm Value ◽  
Market Values ◽  
Exchange Rate Exposure ◽  
Positive Tendency ◽  
Short Period ◽  
The Exchange Rate ◽  
The Impact ◽  
Visegrád Countries

Company’s involvement in global activities through international trade is the primary source of their foreign exchange exposure. Many empirical studies suggest the negative impact of uncertainty about the development of the exchange rate on cash flow and profitability of companies, and thus their market values. Some economic studies show that foreign revenues are positively correlated with the exchange rate exposure and in a short period, currency depreciation negatively affects the market value of listed companies. On the other hand, there are studies that show no statistically significant links between the value of the companies and exchange rates. The aim of this paper is to evaluate the effect of exchange rates on the value of companies listed on stock exchanges in the Visegrad countries. Paper applies Jorion’s model and panel data regression for the sample period 2002 – 2016. Estimations for the whole period revealed negative relationship between exchange rate and value of stock companies. The highest exposure is observed in case of Hungary and Czechia. Positive tendency can be seen in comparison of pre‑crisis and post‑crisis period. Except the case of Hungary, all markets showed decreased exchange rate exposure in time.

ANALISIS EKSPOSUR EKONOMI DAN FAKTOR-FAKTOR YANG MEMPENGARUHINYA PADA PERUSAHAAN ROKOK YANG TERCATAT DI BEI

Wahana ◽  
2019 ◽  
Vol 21 (2) ◽  
pp. 98-109
Author(s):  
Ida Musdafia Ibrahim ◽  
Arif Haryono
Keyword(s):  
Exchange Rate ◽  
Exchange Rates ◽  
Cash Flow ◽  
Firm Value ◽  
Tobacco Industry ◽  
Cash Flows ◽  
Least Square ◽  
Exchange Rate Risk ◽  
Positive Effects ◽  
Rate Risk

This study aims to analyze economic exposures and its factors namely exchange rates and inflation, that influence firm value as reflected through firm cash flow. Analytical method used Ordinary Least Square and eviews as analytical tool. This study used secondary data and cigarette industry companies listed on the Indonesia Stock Exchange as samples along 2008 to 2017. Samples choosing method used purposive sampling based on determined criterias. The results showed that partially economic exposure had positive effects on firm value but insignificant. These could be seen from the economic exposure factors influncenced namely exchange rates and inflations.The exchange rate risk has low influenced cash flow was caused of the tobacco industry has low level of export/import.Enhance,inflation also had low effect on cash flow was caused of the tendency of cigarette consumers will continue to buy cigarettes even though its price increases. In short, economic exposure in the tobacco industry has low influence toward firms value. Hence, simultaneously changes in exchange rates and inflation which are economic exposure indicators have a significant effect on cash flows.  Keywords: Economic Exposure, Exchange Rate Risk, Inflation Risk, Firms Value, Cash Flow

scholarly journals Impact of Entrepreneurship Extracurricular Activities and Inspiration on Entrepreneurial Intention: Mediator and Moderator Effect

SAGE Open ◽  
2021 ◽  
Vol 11 (3) ◽  
pp. 215824402110321
Author(s):  
Thuy Thu Nguyen ◽  
Linh Thi Phuong Nguyen ◽  
Hoa Thi Thanh Phan ◽  
Anh Trong Vu
Keyword(s):  
Extracurricular Activities ◽  
Structural Equation ◽  
Entrepreneurial Intention ◽  
Equation Modeling ◽  
Moderator Effect ◽  
Technical Students ◽  
Research Findings ◽  
Direct And Indirect Impacts ◽  
Indirect Impacts ◽  
The Impact

This empirical study proposed a comprehensive model testing the direct and indirect impacts of entrepreneurship extracurricular activities and entrepreneurship inspiration on students’ entrepreneurial intention. With the sample consisting of 640 students from 11 universities in Vietnam, the study used structural equation modeling analysis approach. The results revealed that entrepreneurship extracurricular activities and entrepreneurship inspiration are significantly related to students’ entrepreneurial intention, and entrepreneurship self-efficacy partially mediates these relations. The impact of entrepreneurship education on entrepreneurial intention differs across the field of study. Technical students generally get more benefits from entrepreneurship educational activities than business and economics students do. The research findings recommended some implications for fostering graduates’ entrepreneurship in emerging countries.

scholarly journals An Interpretation of Recent Research on Exchange Rate Target Zones

1992 ◽  
Vol 6 (4) ◽  
pp. 119-144 ◽  
Author(s):  
Lars E. O Svensson
Keyword(s):  
Exchange Rate ◽  
Central Bank ◽  
Exchange Rates ◽  
Interest Rates ◽  
Empirical Research ◽  
Target Zones ◽  
The Difference ◽  
Exchange Rate Target Zones ◽  
Main Ideas ◽  
Central Bank Interventions

How do exchange rate bands work compared to completely fixed rates (between realignments); or, more precisely, what are the dynamics of exchange rates, interest rates, and central bank interventions within exchange rate bands? Does the difference between bands and completely fixed exchange rates matter, and if so, which of the two arrangements is best; or, more precisely, what are the tradeoffs that determine the optimal bandwidth? This article will present an interpretation of some selected recent theoretical and empirical research on exchange rate target zones, with emphasis on main ideas and results and without technical detail.

scholarly journals The Impact of the Physical Environment on Intrapartum Maternity Care: Identification of Eight Crucial Building Spaces

2019 ◽  
Vol 12 (4) ◽  
pp. 67-98
Author(s):  
Nicoletta Setola ◽  
Eletta Naldi ◽  
Grazia Giulia Cocina ◽  
Liv Bodil Eide ◽  
Laura Iannuzzi ◽  
...  
Keyword(s):  
Maternity Care ◽  
Physical Environment ◽  
Architectural Design ◽  
Well Being ◽  
Physical Characteristics ◽  
Interdisciplinary Studies ◽  
Room Size ◽  
Direct And Indirect Impacts ◽  
Indirect Impacts ◽  
The Impact

Objectives, Purpose, or Aim: This article investigates whether the physical environment in which childbirth occurs impacts the intrapartum intervention rates and how this might happen. The study explores the spatial physical characteristics that can support the design of spaces to promote the health and well-being of women, their supporters, and maternity care professionals. Background: Medical interventions during childbirth have consequences for the health of women and babies in the immediate and long term. The increase in interventions is multifactorial and may be influenced by the model of care adopted, the relationships between caregivers and the organizational culture, which is made up of many factors, including the built environment. In the field of birth architecture research, there is a gap in the description of the physical characteristics of birth environments that impact users’ health. Method: A scoping review on the topic was performed to understand the direct and indirect impacts of the physical environment on birth intervention rates. Results and Discussion: The findings are organized into three tables reporting the influence that the physical characteristics of a space might have on people’s behaviors, experiences, practices and birth health outcomes. Eight building spaces that require further investigation and research were highlighted: unit layout configuration, midwives’ hub/desk, social room, birth philosophy vectors, configuration of the birth room, size and shape of the birth room, filter, and sensory elements. Conclusions: The findings show the importance of considering the physical environment in maternity care and that further interdisciplinary studies focused on architectural design are needed to enrich the knowledge and evidence on this topic and to develop accurate recommendations for designers.

scholarly journals How Does Debt Financing Affect Financial Performance? A Study of Transport Companies Listed in Pakistan

2020 ◽  
Vol 2 (2) ◽  
Author(s):  
Ulfat Abbas ◽  
Sohail Aziz ◽  
Samina Khan
Keyword(s):  
Financial Performance ◽  
Debt Financing ◽  
Annual Reports ◽  
Transport Sector ◽  
Return On Assets ◽  
Secondary Sources ◽  
Earnings Per Share ◽  
The Impact ◽  
Retained Earnings

  Purpose: The purpose of this paper investigates the impact of debt financing on airline’s (transport) sector performance of Pakistan. Design/Methodology/Approach: We gathered the data from secondary sources. In this study, we used a data sample of 11 years from 2008-2018 by using companies annual reports. Due to unavailability of data, only 3 transport companies have been taken for analysis. The software which we used in analysis is SPSS (Statistical Package for Social Science). Findings: The findings of the study suggests that there is opposite relationship between debt financing and financial performance of airlines. Debt is measured from three ratios, short term debt to total assets, long term debt to total assets and total debt to total assets ratio. For the measurement of performance, we used return on assets and earnings per share. We concluded on the basis of findings that the companies should focus on retained earnings which is cheaper source of finance and use less level of debt. As the more level of debt use by the companies, the performance of companies’ decrease. Implications/Originality/Value: There is only one study is available in Pakistan which used transport sector in Pakistan in debt financing context                                                          

scholarly journals Corporate Governance And Its Effect On Firm Performance In An Emerging Economy

2022 ◽  
Vol 2 (3) ◽  
pp. 281-291
Author(s):  
Langa Esmael KAREM ◽  
Hawkar Anwer HAMAD ◽  
Hakar Abubakir BAYZ ◽  
Naji Afrasyaw FATAH ◽  
Diary Jalal ALI ◽  
...  
Keyword(s):  
Financial Performance ◽  
Business Processes ◽  
Board Members ◽  
Board Composition ◽  
Return On Assets ◽  
Board Size ◽  
Cross Sectional ◽  
The Impact ◽  
The Relationship ◽  
Board Ownership

Having a board of directors is very important to ensure the smooth running of business processes and have an impact on the company's financial performance. This study to determine the impact of board characteristics namely board size, board ownership and board composition on the financial performance of organizations as measured by Return on Assets. The study employed a descriptive-explanatory research design based on a cross-sectional approach. Correlation and regression analyses were conducted to determine the depth and extent of the relationship between the variables. The study revealed a positive and significant association between the board size and financial performance on an average of 9 board members. Board composition revealed that having more external directors had no effect on the financial performance, it neither increased it nor decreased it, leading to the rejection of the hypothesis. On the other hand, board ownership was found to be beneficial in terms of having directors as owners of the business, corroborating the Stakeholder Theory. The studies showed that there was still a need to select board members with caution striking a balance between the number of directors as well as their composition to ensure that the organization reaps maximum benefits from the board.

scholarly journals Modeling Sources of Asymmetry in the Volatility of the Moroccan Dirham Exchange Rate

2021 ◽  
Vol 8 (4) ◽  
pp. 31
Author(s):  
KHATTAB Ahmed ◽  
SALMI Yahya
Keyword(s):  
Exchange Rate ◽  
Central Bank ◽  
Exchange Rates ◽  
Foreign Exchange ◽  
Selection Criterion ◽  
Econometric Models ◽  
Interbank Market ◽  
Foreign Exchange Reserves ◽  
Central Bank Intervention ◽  
The Exchange Rate

The main objective of this paper is to study the sources of asymmetry in the volatility of the bilateral exchange rates of the Moroccan dirham (MAD), against the EUR and the USD using the asymmetric econometric models of the ARCH-GARCH family. An empirical analysis was conducted on daily central bank data from March 2003 to March 2021, with a sample size of 4575 observations. Central bank intervention in the foreign exchange (interbank) market was found to affect the asymmetry in the volatility of the bilateral EUR/MAD and USD/MAD exchange rates. Specifically, sales of foreign exchange reserves by the monetary authority cause a fall in the exchange rate, which means that the market response to shocks is asymmetric. Finally, the selection criterion (AIC) allowed us to conclude that the asymmetric model AR(1)-TGARCH(1,1) is adequate for modeling the volatility of the exchange rate of the Moroccan dirham.

scholarly journals The Impact of Russia’s Oil-Dominated Energy Economic Changes on the Exchange Rate of Russian Ruble – Chinese Renminbi

2017 ◽  
Vol 13 (22) ◽  
pp. 173
Author(s):  
Maoguo Wu ◽  
Yue Yu
Keyword(s):  
Economic Development ◽  
Exchange Rate ◽  
Exchange Rates ◽  
Explanatory Power ◽  
Close Relation ◽  
Policy Implications ◽  
The Exchange Rate ◽  
Exchange Rate Changes ◽  
Pillar Industry ◽  
The Impact

Russia’s economic development has a close relation with China, due to geographical and historical reasons. This paper investigates whether the ruble – renminbi exchange rate changes accordingly when the pillar industry of Russia is drastically changing, and how the exchange rate changes and how it affects Russia’s economic development. In this paper, data of 7 variables spanning 122 months are selected based on related literature and availability of data. Regression analysis and empirical tests are carried out consequently. The results show that the energy price index represented by oil prices is negatively correlated with the exchange rate, and the explanatory power is as high as 41.1%. Following basic arbitrage methods and strategies, this paper verifies the feasibility of using arbitrage by comparing actual exchange rates with forecasted exchange rates. According to empirical results, problems witnessed in the process of ruble internationalization provides policy implications for China. China’s economy is utilized as an example to discuss the shortcomings of Russia’s economy. Related solutions are proposed.

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