• The Journal of the Korea Contents Association
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• v.13 no.11
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• pp.829-844
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• 2013

This study performed comprehensive tests on the four hypotheses on the capital structures for the firms listed in the KOSPI during the period from 2006 to 2011. It may be of concern to find any financial profiles on firms' leverage across the book- and market-value bases since there was relatively little attention drawn to any financial changing profile of the leverage surrounding the period of the pre-and the post-global financial crises. The findings of this study may also be compared with those of the previous related literature, by which it may be expected to enhance the robustness and consistency of the results across the different classifications on capital markets. It was found that three explanatory variables such as PFT, SIZE, and RISK, were found to be the statistically significant attributes on leverage during the tested period. Moreover, the outcome by the Fisher Exact test showed that a firm belonging to each corresponding industry may possess its reversion tendency towards the industry mean and median leverage ratios.

• Journal of Industrial Convergence
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• v.22 no.2
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• pp.1-12
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• 2024

This study investigates what decisions have an impact on bank performance. A panel regression analysis was conducted using data from the financial statements of banks located in the United States from 2013 to 2022, and the effects of explanatory variables were examined through hierarchical panel regression analysis divided into financial decision-making and management decision-making. In addition, by analyzing performance separately from the creditor and shareholder perspectives (hereinafter referred to as overall) and from the shareholder perspective alone, it suggests which elements should be utilized and how to improve performance from each perspective. When a panel regression analysis was performed using only liquidity and stability, dependency on deposits and the interest coverage ratio had a statistically significant impact from the perspective of overall performance, and the debt ratio also had a statistically significant impact from the perspective of shareholder performance. When adding non-technical factors, only the labor cost ratio among non-technical factors was found to be statistically significant from the overall performance perspective, and although the non-technical factors were not statistically significant from the shareholder performance perspective, the cash ratio was found to have a statistically significant impact. Lastly, when adding technical innovation elements, the intangible asset ratio was not statistically significant from the overall performance perspective, but was significant from the shareholder performance perspective. The significance and implications of this study are that there are differences in factors that can affect the performance of overall or shareholder and that various decision-making factors can affect a bank's performance.

• The Journal of the Korea Contents Association
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• v.12 no.4
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• pp.401-406
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• 2012

Shanghai Stock Exchange is the largest stock exchange of emerging markets that there were listed firms 905, listed securities 1,537, listed stocks 949, total number of listed stocks 2 trillion 2000 billion shares. There is more development that is expected to occur in the future. The purpose of this study is to find determinants of capital structure to listed manufacturing firms in Shanghai Stock Exchange using multiple regression. Conclusions of this study are summarized as follows. First, firm size is positively related to debt ratio significantly at 1% significance level.. Second, the profitability is negatively related to debt ratio significantly at 1% significance level. Third, the growth ability is positively related to debt ratio significantly at 1% significance level. fourth, cash flow, the largest shares ownership, negotiable shares ratio are negatively related to debt ratio but they are not significant statistically. The result of this study provides information for investors and can be utilized to improvement of financial structure.

• The Korean Journal of Financial Management
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• v.26 no.4
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• pp.35-61
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• 2009

This paper investigates whether the investment of a chaebol firm depends on financial characteristics such as leverage and growth opportunity. We find that the investment of a chaebol firm increases as its growth opportunity increases. We also find that this positive effect of growth opportunity on the investment is more pronounced in a low-leverage firm than in a high-leverage firm. Unlike chaebol firms, however, the interaction effect between leverage and growth opportunity is not statistically significant for nonchaebol firms.

• The Korean Journal of Financial Management
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• v.24 no.1
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• pp.149-182
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• 2007

This study examines the determinants of the long-run stock price performance of the firms that granted stock options between 1997 and 2002. We divide the sample into the firms run by the owner and those run by the professional manager. If the primary reason for granting stock options is reduction of the agency costs between the manager and shareholders, the effect of stock options is likely to be more pronounced in the firms run by the professional manager. We find that the long-run abnormal returns of the firms run by the professional manager are negatively associated with the shareholdings by the manager and the book-to-market value and are positively associated with the earnings growth and the size of the outstanding stock options. In contrast, the long-run abnormal returns of the firms run by the owner are negatively associated with the cash flows rate and the sales growth rate and are positively associated with the firm size. This is consistent with the argument that the agency costs arising from the conflicts between the manager and shareholders are an important determinant of the post-stock option granting long-run stock price performance only in the firms run by the professional manager. The results also suggest that stock options in the firms run by the owner are likely to be used for the purposes such as additional compensation, a signaling device, a means that reduce the agency costs within firms.

• Korea Real Estate Review
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• v.27 no.3
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• pp.23-40
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• 2017

This study examined the motive and incentive for the disposal and purchase of corporate real estate assets based on the various firm characteristics. It was empirically found that firms with a higher leverage ratio, lower cash holdings, and lower sales growth are more likely to dispose of their real estate assets. This implies that financial constraints, internal reserves, and growth opportunities are important factors affecting the corporate decisions regarding the disposal of real estate assets. Meanwhile, it was found that firms with a lower leverage ratio have a higher probability of purchasing real estate assets, suggesting that a stable financial structure enables firms to acquire more of such assets. Using the transaction amount of corporate real estate assets, consistent results were found. While varied opinions on the utilization of corporate real estate assets have been raised, this study broadened the understanding of such by performing rigorous analyses. The result of this study would have practical implications in terms of the introduction of regulations or the establishment of business strategies related to corporate real estate assets.

• Journal of Navigation and Port Research
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• v.45 no.6
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• pp.276-283
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• 2021

The capital structure of the shipping business, which is characterized by its capital intensity and extreme market volatility, is closely related to long-term stability. Research in this area has been conducted mostly in the form of deriving the determinants of capital structure from company-wise financial ratios. This research, on the other hand, has a different approach to the topic. It identifies the relationship between actual cash profit and loss and other variables - i.e. actual vessel prices, interest rates and leverage ratio - by employing historical simulation. The result demonstrates that the P anamax cash profit shows 0 (break-even point) when the debt weight reaches 64.38% (debt ratio 180.74%) and the Cape, 73.04% (debt ratio 270.92%). Additionally, the ships of different types show a divided pattern for the pre- and post-'Super Boom'. It indicates that the business area and the market cycle should be considered when a leverage strategy is established. This research benefits shipping companies set a rational leverage strategy as well as delivers a reasonable guideline to government authorities for the development of a sound policy on shipping finance.

• Journal of the Korea Academia-Industrial cooperation Society
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• v.19 no.7
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• pp.174-182
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• 2018

Given the ongoing debate in many aspects of finance, more attention may need to focus on corporate R&D expenditures. This study empirically tests financial determinants of R&D expenditures for NYSE-listed and KOSPI-listed firms. Three major hypotheses were postulated to test for corporate R&D outlay. First, proposed variables such as one-year lagged R&D expenditures, market value based leverage, profitability and cash holdings showed significant influence on corporate R&D costs for the sample firms. Moreover, financial factors inclusive of squared one-year lagged R&D expenditures, the interaction effect between one-lagged R&D expenditures and high-growth firm, non-debt tax shield, Tobin's q and a dummy variable to explain differences in accounting treatment between the U.S. and Korea, revealed significant differences between the two samples. Finally, in the conditional quantile regression (CQR) analysis for the R&D-related variables in relation to corporate growth rate, it was found that the NYSE-listed firms had a statistically significant linkage between growth potential and one-year lagged R&D expenditures at lower quantile levels. This study may shed new light on identifying financial factors affecting differences between the U.S. market (as an advanced market) and the Korean market (as an emerging market) regarding the optimal level of R&D investments for shareholders.

• Journal of the Korea Academia-Industrial cooperation Society
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• v.15 no.1
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• pp.86-98
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• 2014

This study examined a long-standing issue with its perverse results in the Korean capital markets, such as any variant financial profiles over time, affecting capital structure for the firms belonging to the chaebols. It may be of interest to identify these components from the perspectives of international investors and domestic policy makers to implement their contingent strategies on the target leverage, since the U.S. financial turmoils in the late 2000s. Regarding the evidence from the three hypothesis tests on the firms in the chaebols, this research found that the control variabels measuring profitability, business risk, and non-debt tax shields, showed their statistically significant relationships with the different types of a debt ratio. While FCFF(free cash flow to the firm) showed its significant influence to discriminate between the firms in the chaebols and their counterparts, not belonging to the chaebols, BDRELY as the ratio of liabilities to total assets, comprising the enhanced 'Dupont' system, only showed its statistically significant effect on leverage in the context of the parametric and nonparametric tests. In line with the results obtained from the present research, one may expect that a firm in the Korean chaebol, may control or restructure its present level of capital structure to revert to its target optimal capital structure towards maximizing the shareholders' wealth.

• Journal of Korea Port Economic Association
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• v.29 no.2
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• pp.19-38
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• 2013

This paper explores the relationship between shipping firm's investment and debt-ratio characteristics. Using a panel of 41 shipping firms from 2006 to 2011, this study finds evidence that debt/asset ratio and leverage are negatively associated with firm's investment activities. This relationship shows that volume of debt and capital structure are critical decision factor on firm's investment and capital financing. In terms of financial expenses to sales, positive relationship is existed with firm's investment finding that financing cost is important to investment. The previous study of the firm's investment in other sector also shows a negative relationship with debit ratio. This study is also interested in the extent to which the firm's investment is affected by firm size because there is general agreement that smaller firms have less access to external capital markets. As results, smaller companies group have more positive relationship with factors related to financing cost such as financial expenses to sales and tax. On the other hand, bigger companies group shows the evidence that firm investment is positive relationship with asset size. The analysis corresponding to economic fluctuation shows that debit ratio is more sensitive to firm's investment during a recession. On the other hand, financial expenses to sales is more related to firm's investment during an economic boom.