1,721,011 research outputs found
Islamic financing in mitigating access to financing problems of SMEs in Malaysia: a survey analysis
No full textThe impact of sukuk on corporate financing: Malaysia evidence
No full textA remarkable effect of bond market development on corporate financing is detected among firms in Malaysia en route the study to identify the existence of target capital structure and simultaneously explore firm specific and country specific determinants of target capital structure for firms in Malaysia. This is argued to be the effect of the phenomenal development of sukuk, or Shariah-compliant bonds in Malaysia. The distinctive effect of bond market development with sukuk element on Malaysian firms shows the substantial influence of country specific factors like bond market development as well as governance incorporate financing decision. Employing the dynamic Partial Adjustment Model estimated based on the Generalized Method of Moments (GMM) estimator using data of non-financial listed firms for the period of 2000-2009, this study contributes to the existing literature by highlighting the impact ofa well-developed sukuk in bond market development on corporate financing decision and how good governance can ensure liquid and vibrant bond market as an alternative financial intermediary. This study concludes that several factors significantly influence target capital structure and the element of sukuk in bond market in Malaysia coupled with good governance have a substantial impact on corporate financing decision among firms in Malaysia
Dynamic adjustment towards target capital structure: Thailand evidence
No full textBy employing panel data, the present study examines the dynamic aspects of capital structure of 269 non-financial listed firms in Thailand from 2000 to 2009. This is a relatively new area in finance literature. The present study investigates the existence of target capital structure, speed of adjustment and factors affecting the speed of adjustment. The analyses are conducted using the dynamic Partial Adjustment Model (PAM) and estimated based on the Generalized Method of Moments. The results indicate the existence of target capital structure and firms undergone adjustment processes to be at their target capital structure from time to time with a considerably rapid speed of adjustment, consistent with the dynamic trade-off theory. Firms in Thailand are found to be under-adjusting, being below the required adjustment to be at the target within a year. Strong evidence exists that indicates that firm specific factors significantly influence speed of adjustment for firms in Thailand, such as distance from target, size of firm and profitability
Firm level, ownership concentration and industry level determinants of capital structure in an emerging market: Indonesia evidence
No full textThis study evaluates the impact of firm and industry level determinants plus ownership
concentration on the capital structure decisions in Indonesia. This study finds that
growing firms seem to employ high level of debt, taking advantage of the tax shield as
explained by the trade-off theory. However, if the firms are operating in a highly dynamic
environment they tend to take on less debt as to avoid bankruptcy risk. Known to be in a
highly concentrated ownership structure, firms in Indonesia opt to debt financing perhaps
to act as a controlling mechanism to mitigate agency conflicts that may exist between
the large controlling shareholders and the minority. Aged and highly profitable firms with
high tangible and intangible assets and liquidity level operating in a high munificence
environment follow the pecking order theory. The insights on the impact of industry
characteristics are novel especially on emerging market thus fill the gap in the literature
Target capital structure and speed of adjustment: panel data evidence on Malaysia Shariah compliant securities
No full textMalaysian Crude Palm Oil market volatility: a GARCH approach
No full textThis study aims to examine the volatility of Malaysian Crude Palm
Oil (CPO) markets for it has important implication to both business
communities and policy makers. This study adopted the GARCH (1,1)
model and the result of the finding exhibited persistent volatility as
well as volatility clustering in Malaysian CPO market. The persistent
volatility implies that the percentage of market volatility is closer to
unity. This reflects the frequency of occurrence of the CPO markets
volatility while volatility clustering provides useful information on
the broadness of the shock. Adequate understanding on the degree
of volatility of the market can instigate informed decision by policy
makers which may mitigate persistent uncertainty of returns. Business
communities will consistently be alert on market volatility and ready to
make sound decision on any events of the market. This study enhances
the understanding on commodity market volatility by quantifying the
half-life of decay of the shock in the market and contributes to the
literature by providing in sight information on the volatility of the
market
Embedded options and the issue of gharar: empirical evidence from Malaysia
No full textDespite its accelerating use in the financial market, embedded options receive contradicting opinions with regards to its permissibility based on Shari?ah principles. This study will examine
the existence of the gharar element in the pricing of embedded options (warrants), especially in the case of mispricing. The Black Scholes Option Pricing Model (BSOPM), a robust set of methods, is
used to analyze the pricing efficiency of warrants market and to detect any mispricing in warrants contracts in Malaysia. Looking from the perspective of an informationally efficient market, there
seems to be a pricing inefficiency in the local warrants market in reference to its theoretical values. This mispricing of warrants indicate inefficiency in the warrants market and the element of gharar
in a warrants contract is viewed from the mispricing detected in the study. Mispricing of warrants in the Malaysian market indicates speculative activities, and speculation is not allowed in Islam.
Speculation is prohibited in Islam as it may contain excessive gharar (uncertainty) and maysir (gambling). These may then result in wealth accumulation at the expense of the jahil (ignorance) other parties?. This activity violates the concept of adl (justice), does not serve the
concept of maslahah (public interest) and does not comply with maqasid al-shari\u27ah
Islamic capital market and debt financing of shariah-compliant firms in Indonesia
No full textIslamic Capital Market (ICM) is expanding rapidly worldwide and
Indonesia is following very closely. Examining 290 shariah-compliant
Indonesian firms, we found that certain firm and industry level
determinants do influence the debt financing without ignoring the
shariah principles governing the decisions. The ICM accelerating
growth is very much reflected in the findings, thus contributing
significantly in the literature and to the policymakers as well. Being
shariah-compliant does not hinder them from engaging in higher debt
with Islamic debt instruments employed as alternatives
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