scholarly journals Influence of Internal Factors on the Financial Performances: An Empirical Study on Nigerian Deposit Money Banks

2020 ◽  
Vol 03 (12) ◽  
Author(s):  
Shuaib Adeadebayo Abdulkabir ◽  
Keyword(s):  
Capital Structure ◽  
Financial Performance ◽  
Opposite Direction ◽  
Operating Cost ◽  
Fixed Effect Model ◽  
Fixed Effect ◽  
The Other ◽  
Income Diversification ◽  
Internal Factors ◽  
Effect Model

This study examines the influence of internal factors on financial performance in Nigerian deposit money banks by using panel data of banks over the period 2009 to 2019. Since the data is secondary in nature, the quantitative approach to research was considered. Besides, the fixed effect model was used. The fixed effect model is preferred to the random effect model based on the Housman specification test. Under this study, internal and factors were examined. The internal factors used in this study include capital structure; Income Diversification, operating cost and bank size whereas, ROA and ROCE were used as the financial performance measure. Based on the regression result, all bank specific variables except bank size affect performance of the bank significantly but negatively. While based on correlation analysis, Bank size was positively correlated with ROCE. These clearly shows that, as the bank size increases, ROCE also moves on the same direction. On the other hand, the income diversification, capital structure and operating cost were negatively correlated with ROCE. Also, as the income diversification, capital structure and operating cost increases, ROCE moves in opposite direction. Moreover, the capital structure and the operating cost negatively correlated with ROA. This indicates that as capital structure increases, ROA moves to the opposite direction. On the other hand, income diversification and bank size were positively correlated with ROA. Based on the empirical findings, both capital structure and operating cost negatively and significantly affect performance measured by ROA and ROCE.

scholarly journals Effects of Capital Structure on Financial Performance of Insurance Companies in Nepal

2020 ◽  
Vol 10 (3) ◽  
pp. 35
Author(s):  
Bishnu Prasad Bhattarai
Keyword(s):  
Capital Structure ◽  
Financial Performance ◽  
Annual Report ◽  
Random Effect ◽  
Random Effect Model ◽  
Fixed Effect Model ◽  
Insurance Companies ◽  
Return On Assets ◽  
Total Debt ◽  
Effect Model

The study has examined the effects of capital structure on financial performance of insurance companies in Nepal. Data were collected from the annual report of the respective insurance companies' web site. The panel data of 14 Nepalese insurance companies from 2007/08 to 2015/16, leading to a total of 126 observations. The data were analyzed using pooled OLS model, random effect model and fixed effect model. The study has been return on assets as dependent variable whereas total debt ratio, equity to total assets, leverage, firm size, liquidity ratio and assets tangibility are independent variables. The result concluded that equity to total assets, leverage, and assets tangibility have effects the financial performance in Nepalese insurance companies' cases.

scholarly journals THE FINANCIAL PERFORMANCE OF MANUFACTURING COMPANIES IN IDX AND SOME FACTORS THAT INFLUENCE

2021 ◽  
Vol 19 (2) ◽  
pp. 354-362
Author(s):  
Ichsan Ichsan ◽  
◽  
Ira Silvia ◽  
Mahdawi Mahdawi ◽  
Ghazali Syamni ◽  
...  
Keyword(s):  
Financial Performance ◽  
Fixed Effect Model ◽  
Fixed Effect ◽  
Dominant Factor ◽  
Manufacturing Companies ◽  
Factors Affecting ◽  
Industrial Sectors ◽  
Effect Model ◽  
Study Results ◽  
Equity Ratio

This study aims to examine some factors affecting the financial performance of manufacturing companies in the Indonesia Stock Exchange (IDX). This research uses data on the financial statements of 20 manufacturing companies listed on IDX in the period 20132017 and carried out share distribution facilities for their employees. This research model is a panel regression model done by testing the common effect model, fixed-effect model, and random effect model. Based on the Chow test and Hausman test, it is found that the best model in this study is the fixed effect model. The study results find that dividend policy, a share giving program to employees, and debt to equity ratio are significant factors affecting the financial performance of manufacturing companies in Indonesia. From these three factors, the debt to equity ratio is the dominant factor determining the financial performance of manufacturing companies, while investment decision does not significantly affect it. Future research studies can be carried out by focusing on other industrial sectors such as the Jakarta Islamic Index 70 and adding other macroeconomic variables.

scholarly journals Determinants of Financial Performance of Nepalese Commercial Banks: Evidence from Panel Data Approach

2020 ◽  
Vol 32 (2) ◽  
pp. 45-59
Author(s):  
Purna Man Shrestha
Keyword(s):  
Panel Data ◽  
Financial Performance ◽  
Commercial Banks ◽  
Fixed Effect Model ◽  
Fixed Effect ◽  
Lagrangian Multiplier ◽  
Effect Model ◽  
Specific Factors ◽  
The Impact ◽  
Bank Specific Factors

The impact of bank specific factors on the financial performance of Nepalese commercial banks is analyzed in this paper. The financial performance is measured by using return on assets (ROA). Similarly, managerial efficiency (ME), liquidity (LIQ), credit risk (CR), assets quality (AQ) and operational efficiency (OE) is used as proxy of bank specific factors. This study used panel data of 17 commercial banks for the period of 2010/11 to 2017/18. Breusch and Pagan Lagrangian multiplier test showed that Pooled Regression model is not appropriate and Hausman test concluded that Fixed Effect model is appropriate rather than Random Effect model. Using the Fixed Effect model; this study concludes that bank specific factors have significant impact on financial performance of Nepalese commercial banks. Finally, this study reveals that ME, AQ and OE have significant positive impact, and CR has negative impact on the financial performance of Nepalese commercial banks.  

scholarly journals An Assessment on the Influence of Capital Structure on Performance of the Listed Firms in Tanzania

2021 ◽  
Vol 4 (1) ◽  
pp. 1-13
Author(s):  
Martin Ayo ◽  
Seif Muba
Keyword(s):  
Capital Structure ◽  
Significant Influence ◽  
Fixed Effect Model ◽  
Fixed Effect ◽  
Control Effect ◽  
Listed Firms ◽  
Total Debt ◽  
Effect Model ◽  
Equity Ratio ◽  
The Relationship

The research mostly assessed and established the influence of capital structure on the performance of firms listed under the Dar Es Salaam stock exchange (DSE). Specifically, the study aimed to assess the influence of total debt to equity ratio (TDE), total debt to assets ratio (TDA), total equity ratio (TEQ) on the performance of listed firms in Tanzania. Also, the study aimed to determine the control effect of firm size (FS) on the relationship between firm performance and capital structure. The quantitative panel data approach was used. The fixed-effect model for ROA was done to see the influence of TDE on ROA. Results indicated that only TEQ has a significant positive influence on the ROA while TDE and TDA have no significant influence on the ROA. Also, the fixed-effect model for ROCE was carried out to see the relationship between TDE and ROCE. Results showed that TDA and TEQ are insignificant to the ROCE, while TDE is significant to the ROCE. Findings also showed that the presence of the FS on the model of capital structure and ROA, results in TDA, and TEQ having a significant influence on ROA, while TDE becomes insignificant to ROA. Moreover, results indicated that the presence of the FS on the model of capital structure and ROCE results in the only TDE to have a significant influence on ROCE, while TDA and TEQ became insignificant to ROA. The study concluded that TDE has no significant influence on the ROA but TDE has a significant influence on ROCE. Also, the study concluded that TDA has no significant influence on both the ROA and ROCE while TEQ influences ROA positively, and has no significant influence on ROCE. Moreover, the study concluded that the presence of the FS on the model of capital structure and ROA, results in TDA, and TEQ having a significant influence on ROA, while TDE becomes insignificant to ROA. Furthermore, FS resulted in TDE having a significant influence on ROCE, while TDA and TEQ become insignificant to ROCE. The study recommends that companies very carefully must decide on a reasonable capital structure to maintain the performance of the company.

Correcting for nonrandom errors in a fixed-effect model

1989 ◽  
Vol 19 (12) ◽  
pp. 1550-1554 ◽  
Author(s):  
Robin M. Reich ◽  
Loukas G. Arvanitis
Keyword(s):  
Iterative Procedure ◽  
Tree Height ◽  
Generalized Least Squares ◽  
Fixed Effect Model ◽  
Fixed Effect ◽  
Slash Pine ◽  
The Other ◽  
Random Errors ◽  
Effect Model ◽  
Total Tree

In this article, a statistical method of estimating the microsite component (a nonrandom error) in a fixed-effect model is presented and discussed. The approach uses generalized least squares to partition the model variance into two components: one part due to microsite and the other one due to random errors. An iterative procedure is then used to solve for the maximum likelihood estimate of the microsite component. Application of the technique to a slash pine (Pinuselliottii Engelm. var. elliottii) spacing trial indicates that 30% of the variability in total tree height at age 6 years was due to microsite, whereas the remaining 70% was due to random errors.

scholarly journals Trade-off theory of capital structure: evidence from estimations of non-parametric and semi-parametric panel fixed effect models

2017 ◽  
Vol 14 (1) ◽  
pp. 115-123
Author(s):  
Wen-Chien Liu
Keyword(s):  
Capital Structure ◽  
Financial Distress ◽  
Firm Value ◽  
Fixed Effect Model ◽  
Kernel Functions ◽  
Fixed Effect ◽  
Debt Ratio ◽  
Trade Off ◽  
Effect Model ◽  
Non Parametric

A firm’s capital structure decisions constitute an essential research topic academically and practically. In this study, the author uses the data of US listed firms to test the traditional trade-off theory of capital structure, which posits that firms should balance the benefit of tax shields and costs of financial distress to purse an optimal debt ratio. Therefore, to determine the complex relationship between firm value and debt ratio and avoid the problem of model misspecification, the author adopts the non-parametric fixed effect model and semi-parametric (partially linear) fixed effect model. Our empirical results reveal that a nonlinear and asymmetric relationship exists between firm value and market debt ratio, thus, considerably supporting trade-off theory. Moreover, the use of different definitions of key variables and various kernel functions engenders robust results. Overall, the author suggests that firm managers should employ financial leverages appropriately to maximize firm value.

scholarly journals Pengaruh Intellectual Capital (IC) terhadap Financial Performance Pada Perusahaan Sektor Perbankan yang Terdaftar di Bursa Efek Indonesia

2018 ◽  
Vol 3 (1) ◽  
Author(s):  
Abdul Salam
Keyword(s):  
Financial Performance ◽  
Intellectual Capital ◽  
Banking Sector ◽  
Value Added ◽  
Fixed Effect Model ◽  
Fixed Effect ◽  
Return On Assets ◽  
Structural Capital ◽  
Effect Model ◽  
Capital Value

ABSTRAK Penelitian ini bertujuan untuk menguji pengaruh intellectual capital terhadap financial perforrmance perusahaan di sektor perbankan di Bursa Efek Indonesia periode 2010 sampai 2014 dengan menggunakan data panel. Intellectual Capital di proksikan dengan metode value added  intellectual coefficient (VAIC™) dengan komponennya value added human capital (VAHU), value added capital employe (VACA), dan structural capital value added (STVA) digunakan untuk mengukur nilai dasar kinerja bank, sedangkan Financial Performance di proksikan dengan return on assets (ROA). Alat analisa yang digunakan adalah regresi  liner multivariabel dengan penerapan metode model Fixed Effect dengan sampel dari 24 bank dengan purposive sampling, berdasarkan hasil test Chow, Test Hausman, Test Lagrange Multiplier (LM) maka penelitian ini mengunakan prosedur Model Fixed Effect. Hasil penelitian ini menununjukkan bahwa STVA dan VAIC™ berdampak positif dan signifikan terhadap ROA. Sedangkan VACA dan VAHU berpengaruh positif  dan tidak signifikan terhadap ROA. Hasil Uji F (Simultan) besarnya nilai Adjusted R-squared yaitu 0.381370 yang berarti bahwa variasi variabel ROA dapat dijelaskan oleh variabel VAHU, VACA dan STVA adalah sebesar 0.381370 atau sebesar 38.1370% sedangkan sisanya sebesar 61.827 % dijelaskan oleh faktor-faktor lain yang tidak terdapat dalam penelitian ini.   Keyword : Intellectual Capital, Financial Performance, Fixed Effect Model, Banking Sector  

scholarly journals Is Net Interest Margin influenced by Firm's Capital Structure Pattern: A Study on Commercial Banks in Sri Lanka

2018 ◽  
Vol 10 (2) ◽  
pp. 1
Author(s):  
Lingesiya Kengatharan
Keyword(s):  
Sri Lanka ◽  
Capital Structure ◽  
Commercial Banks ◽  
Random Effect ◽  
Fixed Effect Model ◽  
Fixed Effect ◽  
Structure Pattern ◽  
Net Interest Margin ◽  
Effect Model ◽  
Interest Margin

Objectives of this study were to examine the capital structure pattern of Sri Lankan commercial banks and to investigate the influence of capital structure pattern on net interest margin of commercial banks in Sri Lanka. This study was conducted with 10 licensed commercial banks which were listed in Colombo Stock Exchange (CSE), Sri Lanka. Panel data analysis was used to carry out the empirical study and data were extracted from the annual reports of selected companies for the ten years period from 2007 to 2016. Capital structure patterns of licensed commercial banks were measured by total debt to total assets ratio, long term debt to total assets ratio, and short term debt to total assets ratio. Net Interest Margin (NIM) was measured by net interest income to average earnings assets ratio. NIM specifies the cost and efficiency of financial intermediation by banks. Size of the banks and growth in banks deposit were considered as control variables. Descriptive statistics, correlation, pooled, fixed effect and random effect models were used for the data analysis. According to the descriptive statistics, present study found that commercial banks had lower leveraged capital structure pattern in Sri Lanka. F test was performed to diagnose the time fixed effect in the fixed effect model and outcome of the test revealed that p value was less than 0.05. Therefore, null hypothesis was rejected and fixed effect model was most appropriate than pooled OLS. Further, Lagrange Multiplier test for random effect was performed. The result indicated that the p value was 0.000 and rejected the null hypothesis in favor of the alternative which implied that random effect model was more appropriate than pooled OLS. Therefore, Hausman Specification test was performed to find out whether fixed or random effect model is suitable to examine the relationship between capital structure and NIM. Fixed effect model was considered as the most suitable model to examine the relationship between capital structure and NIM in this study. As per the result of fixed effect model, total debt to total assets ratio and long term debt to total asset ratio were significantly negatively related to NIM. Short term debt to total assets ratio, and size were not significantly related NIM. Results of the study suggest that financial managers should try to finance from retained earnings rather than relying heavily on debt capital in their capital structure. Outcome of the study may useful to the practitioners, investors and decision makers in order to maximize their return from their investments.

scholarly journals Market Power, Types of Ownership and Bank Income Diversification: Cases of Asian Countries

2018 ◽  
Vol 9 (1) ◽  
pp. 12-22
Author(s):  
Valentino Robertho ◽  
Buddi Wibowo
Keyword(s):  
Market Power ◽  
Critical Factor ◽  
Fixed Effect Model ◽  
The Philippines ◽  
Fixed Effect ◽  
Least Square ◽  
Asian Countries ◽  
Government Ownership ◽  
Income Diversification ◽  
Effect Model

This study aims to analyze the effects of market power and type of ownership on bank’s income diversification in Indonesia, Malaysia, the Philippines, Thailand, and China. Banks diversifies their source of income to stabilize profitability level. Bank’s market power is a critical factor which affect its income diversification efforts. This study uses Lerner Index as a proxy for banks’ market power. By using a sample of 80 banks in five countries from 2012 to 2016 and operating Fixed Effect Model and Generalized Least Square, the result shows that banks with greater market power earn more non-interest income, except in the Philippines. Also, government ownership is proven to heighten the relation between market power and income diversification, with consistent results shown in each subsamples. Foreign ownership also heighten the relation between market power and income diversification, except in Thailand.

scholarly journals PENGARUH STRUKTUR MODAL DAN WORKING CAPITAL TURNOVER TERHADAP PROFITABILITAS (Studi Empiris pada Pembayar Pajak Perusahaan yang di Periksa oleh Kantor Pelayanan Pajak Madya Jakarta Pusat)

2017 ◽  
Vol 19 (3) ◽  
pp. 398
Author(s):  
Amdani Amdani ◽  
Desnerita Desnerita
Keyword(s):  
Capital Structure ◽  
Random Effect ◽  
Random Effect Model ◽  
Fixed Effect Model ◽  
Fixed Effect ◽  
Estimation Methods ◽  
Working Capital ◽  
Purposive Sampling ◽  
Effect Model ◽  
The Capital Structure

Penelitian ini bertujuan untuk mendapatkan informasi tentang bagaimana pengaruh Struktur Modal dan Perputaran Modal Kerja baik secara individu atau bersamasama (simultan) terhadap profitabilitas Wajib Pajak perusahaan diperiksa oleh Kantor Pajak Madya Jakarta Pusat. Populasi dalam penelitian ini adalah perusahaan Wajib Pajak yang diperiksa oleh kantor pajak Madya Jakarta Pusat periode 2008-2012, metode sampling dengan teknik purposive sampling, dengan jumlah sampel 15 perusahaan. Data yang digunakan adalah data sekunder, analisis motode adalah analisis data panel dengan Umum Efek Model (pooled kuadrat terkecil), Fixed Effect Model (FEM), dan Random Effect Model (REM) untuk menentukan akurasi dari model yang digunakan kebutuhan Model untuk diuji antara Model tes lain Estimasi Metode, asumsi klasik yang mendasari model regresi. Hasil pengolahan dan analisis data yang diperoleh dari hasilnya adalah efek dari Struktur Modal dan Perputaran Modal Kerja Terhadap Profitabilitas secara signifikan, baik secara parsial maupun secara simultan.This research aims to obtain information on how the influence of the Capital Structure and Working Capital Turnover either individually or jointly (simultaneously) on the profitability of the company Taxpayers inspected by the Tax Office Madya Jakarta Pusat. The population in this study are companies Taxpayers are inspected by the tax office Madya Jakarta Pusat period 2008-2012, the sampling method with purposive sampling technique, with a total sample of 15 companies. The data used is secondary data, motode analysis is the analysis of panel data with Common Effect Model (pooled least squares), Fixed Effect Model (FEM), and Random Effect Model (REM) to determine the accuracy of the model used the model needs to be tested between another test Model Estimation Methods, classical assumption underlying the regression model. The results of processing and analysis of data obtained from the result is the effect of the Capital Structure and Working Capital Turnover On Profitability significantly, either partially or simultaneously.

Sign in / Sign up

Export Citation Format

Share Document