• The Journal of Asian Finance, Economics and Business
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• 제4권1호
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• pp.5-18
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• 2017

Total debt in the People's Republic of China surged to nearly 290% as a ratio to GDP by the second quarter of 2016, mostly on account of non-financial corporate debt. The outpouring of credit to stem the impact of the global financial crisis accentuated industrial overcapacity in traditional sectors, such as steel, cement, and energy, while feeding asset bubbles in the property, equity and bond markets. At the Chinese corporate level, this has translated into weakened fundamentals and a fall in industrial profits, particularly of SOEs. As debtors struggle to service interest payments, non-performing loans (NPLs) have been on the rise. This paper assesses the financial fragility of the Chinese economy by looking at risk factors in the non-financial sector. We apply quantile regressions to a dataset containing all Chinese listed companies in Standard & Poor's IQ Capital database. We find higher sensitivity over time of corporate leverage to some of its key determinants, particularly for firms at the upper margin of the distribution. In particular, profitability increasingly acts as a curb on corporate leverage. At a time of falling profitability across the Chinese non-financial corporate sector, this eases the brake on leverage and may contribute to its continuing increase.

• 한국항해항만학회지
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• 제47권2호
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• pp.100-105
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• 2023

This study investigated determinants of stock betas of shipping companies in Korea. Beta is a measurement of sensitivity of an individual stock to the movement of the whole stock market. It is widely accepted that stock betas are not constant, but time-varying, which implies that they are affected by other factors. In this regard, this study examined betas of six shipping companies listed on the Korea Exchange for the period of 2000-2021 and their relationship with financial leverage, operating leverage, and cyclicality in the shipping market. Empirical analysis showed that betas of Korean shipping companies were positively associated with financial and operating leverages but negatively with cyclicality.

• The Journal of Asian Finance, Economics and Business
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• 제8권3호
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• pp.201-208
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• 2021

This study aimed to identify the key factors that affect the financial market performance (Price-Earnings Model) through a sample of 35 public shareholding industrial companies on the Amman Stock Exchange for the period 2010-2019, using statistical models and methods, such as the Simple Linear Regression Model, Correlation Coefficient, and dispersion board. The study results showed the nonexistence of a statistically significant effect between the intellectual capital and market value added (MVA) and market performance. Results also showed a statistically significant positive effect between financial leverage (FL) and the market performance, where the interpreted variation reached 64%. It showed from the analysis results that the relationship between (MVA) and market performance (P/E) agrees with the study hypotheses, while the result related to (FL) disagrees with the study hypotheses. The study recommends that public shareholding industrial companies should focus more on intellectual capital and show its value in the annual financial statements and reports, and those companies that have high profitability and the chance to hold gains and profits should rely less on debt and more on retained earnings, due to the high risk of debt and in line with the present unstable circumstances in Jordan, especially in light of the global Covid-19 crisis.

• The Journal of Asian Finance, Economics and Business
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• 제9권1호
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• pp.249-257
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• 2022

COVID-19 struck without warning, and by the first quarter of 2020, the world had plunged into a state of total closure as a means of containing the pandemic's devastating effect. Certainly, the pandemic shook many economies; some countries were able to cope, while third-world countries lost their invulnerability. Based on this, the current study looked at financial reports from Kuwaiti conventional and Islamic banks from 2019 to 2020 (before and after the pandemic) and compared the findings to see how much of an impact Kuwaiti conventional and Islamic banks had during the COVID-19 epidemic. Financial analysis of financial reports was used as a quantitative methodology, and variables were compared and analyzed, including (the liquidity ratio, profitability ratio, and financial leverage) within (14) Kuwaiti conventional and Islamic banks. The study found that the pandemic had a detrimental impact on both conventional and Islamic banks in Kuwait, as they were the first line of defense for the Kuwaiti economy during lockdowns and quarantines. Furthermore, there were significant implications on the Rate of Return on Investment, Debt, Financial Leverage, and Return on Equity.

• 재무관리연구
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• 제26권4호
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• pp.35-61
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• 2009

본 논문은 재벌기업의 투자가 부채비율과 성장기회 등 재무적 특성에 영향을 받는지를 분석하였다. 주요분석결과를 보면 재벌기업의 투자는 성장기회가 높아질수록 증가하였고 이와 같은 투자의 성장기회민감도는 비재벌기업에 비하여 더 큰 것으로 드러났다. 그러나 부채비율이 높은 재벌기업은 낮은 재벌기업에 비하여 투자의 성장기회에 대한 민감도가 더 낮은 것으로 드러났다. 한편 재벌기업과는 달리 비재벌기업의 경우에는 부채비율이 기업투자에 미치는 영향이 통계적으로 유의하지 않았고 또한 부채비율과 성장기회간의 교차효과 역시 발견할 수 없었다. 본 논문에서의 실증분석결과는 재벌기업의 내부자본시장이 자회사에 대한 규율과 감시를 통해 투자의 효율성을 높일 수는 있지만 과도한 부채로 자회사의 현금흐름이 고갈되면 내부자본시장의 과잉부채효과가 유발될 수 있음을 시사한다.

• The Journal of Asian Finance, Economics and Business
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• 제6권3호
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• pp.67-79
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• 2019

This study examines the impact of corporate governance on capital structure decisions based on a large panel of Chinese listed firms. Using the system Generalized Method of Moments (GMM) estimator to control for unobserved heterogeneity, endogeneity, and persistency in capital structure decisions, we document that the ownership structure plays a significant role in determining leverage ratios. More specially, we find that managerial ownership has a positive and significant impact on firms' leverage, consistent with the incentive alignment hypothesis. We also find that managerial ownership only affects the leverage decisions of private firms in the post-2005 split share reform period. State ownership negatively influence leverage decisions implying that SOEs may face fewer restrictions in equity issuance and may receive favourable treatments when applying for seasoned equity ¿nancing, thus use less debt. Furthermore, our results show that while foreign ownership negatively influences leverage decisions, legal person shareholding positively influences firms' leverage decisions only for state controlled firms. We also find that the board structure variables (board size and the proportion of independent directors) do not influence firms' capital structure decisions. Our findings suggest that recent ownership reforms have been successful in terms of providing incentive to managers through managerial shareholdings to take risky financial choices.

• The Journal of Asian Finance, Economics and Business
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• 제7권2호
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• pp.53-64
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• 2020

We provide one of the first investigation on the impact of the degree of total leverage to the dividend policy of bank. We use a large sample of US bank holding companies from 2000:Q1 to 2017:Q4 to shed light our research question. Our empirical analysis provides consistent evidence that banks with high degree of total leverage (i.e. banks with a relatively high fixed-to-variables costs) are less likely to pay dividends, and they spend a lower fraction of incomes to pay back shareholders, suggesting a higher conservatism in dividend policy of banks subject to high degree of total leverage. The evidence remains unchanged with alternative econometric approaches, alternative measures of dividend policy and degree of total leverage. We further document that this higher conservatism is strengthened for a sample of banks with low franchise value during the financial crises. Our result suggests that the conservatism in dividend policy of banks with high degree of total leverage seems to be related to the precautionary motives aimed at preserving corporate resources under financial distress. Our study contributes to the literature of cost structure and dividend policy by pointing out that the impacts of the degree of fixed-to-variable expenses to dividend policy are extended to the case of banks.

• 경영과정보연구
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• 제30권4호
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• pp.175-193
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• 2011

본 연구에서는 영업레버리지와 재무레버리지 위험 사이의 관련성을 살펴보았다. 한국거래소에 상장되어 있는 제조업체를 대상으로 1990년부터 2009년까지 20년간의 자료를 사용하여 분석한 결과 영업위험과 재무위험이 외국에 비해 상대적으로 높은 수준을 나타냈으며, 1997년 외환위기 이전까지 지속적으로 상승하는 추세가 2009년에 다시 하락하였다. 그리고 영업레버리지도와 재무레버리지도 사이에는 양의 상관관계가 존재하는 것으로 분석되었으나, 연도별로는 일정한 규칙을 나타내고 있지 않았다. 분석대상 제조업체를 자산규모 세부 요소를 기준으로 구분한 소그룹별 분석에서는 각 그룹별로 상이한 결과를 얻었다. 특히 재무의사결정행태가 레버리지도 수준에 따라 크게 다르게 나타나고 있다. 또한 외환위기 전후로 분석한 결과 영업레버리지는 외환위기 후가 높지만 재무레버리지는 외환위기 전이 높았다. 그러나 영업레버리지는 통계적으로 유의한 차이를 나타내지 않았고, 재무레버리지는 통계적으로 유의한 차이를 나타내고 있다. 이는 외환위기 이후 기업의 위험관리가 재무적인 면에서 강하게 작용하는 것으로 파악된다. 또한 외환위기 후의 영업레버리지와 재무레버리지 크기의 따라 주식수익률이 유의한 차이가 있는 것으로 나타났다.

• 아태비즈니스연구
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• 제9권4호
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• pp.85-97
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• 2018

This paper investigates factors underlying a decrease in trading values in KOSPI 200 futures/options market on the basis of the current state of the markets. Among the factors that could affect trading values in KOSPI 200 derivatives market, we focus on the market activity of underlying assets as it has an impact on the trading of financial derivatives. Trading value and volatility are designated as market activity and the empirical results confirm that the market activity of the underlying assets is significant in explaining the decrease in trading values in KOSPI 200 futures/options market. To figure out fundamental reasons of the decrease in trading values in this market, we examine mitigation of home bias and decrease in leverage incentives as they are presumed to have influence on KOSPI 200 index market. As the global and local financial environment is time-varying, the degree of home bias and the leverage demand also changes. It implies that institutional change and/or policy effort to promote the trading of KOSPI 200 financial derivatives should be made taking into account the fact that considerable portion of the change in trading values in financial derivatives market depends on the state of the market.

• The Journal of Asian Finance, Economics and Business
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• 제8권3호
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• pp.423-431
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• 2021

This study aims to examine the effect of liquidity, activity, leverage, and profitability on firm value, as well as the effect of disclosure of corporate social responsibility (CSR), which in this study is a moderator and company size as a control variable. The sampling technique used in this study is a purposive sampling method with certain criteria, to obtain a sample of 22 LQ45 index companies listed on the Indonesia Stock Exchange in 2014-2019. The data analysis method in this study used was the Multiple Linear Regression Analysis with the SPSS 18 Program. The results show that the ratios of liquidity, activity, leverage, and profitability are significant to firm value in accordance with the initial hypothesis of the study. Corporate Social Responsibility (CSR) plays a role as a moderating variable and company size variable as a control variable on the effect of financial ratios (liquidity, activity, leverage, and profitability) on firm value. The implication of this research is that CSR has a very important role in increasing company value. To attract more investors, companies must pay attention not only to financial performance but also to social performance. Large-scale companies tend to do more CSR so that the company value will increase.