Capital Structure and Financial Performance of Commercial Banks in Ghana | Chapter 2 | Business, Management and Economics - Research Progress Vol. 1

 

This paper investigates the impact of capital structure on the financial performance of commercial banks in Ghana for the period, 2008-2022. The methodology involves a robust analytical framework using econometric models, particularly the Panel Autoregressive Distributed Lag (P-ARDL) regression model enabling a thorough examination of the complex interactions between capital structure and bank performance. Spanning five listed banks over a 15-year period for which consistent data is available, panel-data econometric modelling was used to accommodate individual heterogeneity. The findings reveal a significant long-run positive impact of capital structure on financial performance, suggesting that optimal capital structure can enhance bank performance in the long run. In the short run, capital structure contemporaneously and sluggishly impacts ROA negatively, but with only a weak negative sluggish effect on ROE. The results further highlight the significant long-run detrimental effect of bank size and the robust positive long-run effect of bank growth on the financial performance of banks. The paper recommends a strategic focus on optimising capital structure to enhance the long-run financial performance of Ghanaian commercial banks thereby underscoring the importance of considering internal factors in capital structure decisions. This study contributes to the global discourse on capital structure, offering fresh perspectives from an underdeveloped economic context.

 

Author(s) Details

 

Deodat E. Adenutsi
Department of Accounting and Finance, HTU Business School, Ho Technical University, Ho, Ghana.

 

Please see the link:- https://doi.org/10.9734/bpi/bmerp/v1/880

Measuring Debt Risk during Financial Crisis | Chapter 1 | Business, Management and Economics: Research Progress Vol. 8

The global financial crisis affected many developing countries in different ways. This affected risky portfolios adversely, forcing many investors to incur losses. Financial institutions, specifically banks and small businesses, have encountered difficulty in sustaining their ability to remain stable during the financial crisis. During this period most scholars addressed the cause and risk of financial turbulence but very few studies identified the cost of debt and risk of financial turbulence. The objective of this study is to enhance the Mahalanobis model to include the measurements of cost of debt when measuring financial turbulence which essentially has an impact on the stock market. The data collected in respect of the South African Reserve Bank (SARB) and Statistics South Africa (SAS) identifies the correlation of financial turbulence in banks as well as small businesses and analyses and interprets the relationship between total liquidation of companies and total assets of banks.  The crisis affected markets differently, but they all had the same results of low cash movement that resulted in a decrease in money supply that resulted in financial turmoil.

 

Author (s) Details

 

Keabetswe Ramantshane
School of Business Leadership (SBL), University of South Africa (UNISA), Pretoria, South Africa.

 

Please see the book here:- https://doi.org/10.9734/bpi/bmerp/v8/88

Exploring the Relationship between Board Size and Financial Performance in Nepalese Commercial Banks | Chapter 7 | Contemporary Research in Business, Management and Economics Vol. 8

 

The purpose of this study is to determine the impact of corporate board size on the firm performance of Nepalese commercial banks. This study examines the banks that have directors less than seven on the board and directors equal to or more than 7 on the board, based on 8 years of data taken from the year 2013 to 2020. The study encompasses a sample of 27 commercial banks for analysis, with data gathered from the annual reports of all 27 operating commercial banks listed on the Nepal Stock Exchange. The performance of the firm is assessed using metrics such as Return on Equity (ROE) and Return on Assets (ROA). The relationship between corporate board size and firm performance was assessed using an Independent Sample t-test. The study's findings indicate that commercial banks with less than seven directors on the board, compared to those with seven or more directors, did not demonstrate a significant impact on firm performance in Nepal.

 

Author(s)details:-

 

Mr. Padam Dongol (PhD Scholar)
Lincoln University College, Malaysia.

 

Please See the book here :-  https://doi.org/10.9734/bpi/crbme/v8/154

Investigating the Impact of Leverage and Managerial Skills on Firm Performance | Chapter 3 | Selected Topics in Humanities and Social Sciences Vol. 8

 The purpose of this study is to see how leverage and managerial abilities affect shareholder returns. The share of debt in the total capital structure of the company is particularly important in this study. Leverage is calculated using total debt and long-term debt. The managerial abilities of each company's CEO are assessed based on his or her degree and experience. The return on equity is used to determine how much a stockholder's investment is worth. Different capital structures are used by different organisations, and it is challenging for a manager to determine which capital structure minimises risk and expense while maximising shareholder wealth and firm value. I performed panel data analysis on a sample of 25 companies from 2009 to 2014 for this investigation. Companies from Pakistan's agricultural industry were picked. A significant and positive association exists between a firm's total debt and return on equity, according to the findings of panel data analysis. Similarly, there is a strong and negative association between a company's total debt and return on equity, according to the data. The CEO's education and experience are found to have a strong and favourable association with return on equity. Return on equity, on the other hand, has a negative but significant link with long-term debt. According to the findings, a company's return to shareholders decreases as its debt increases. Increasing just long-term debt diminishes stockholder returns in the same way.

Author(S) Details

Syed Amad Nadeem
Foundation University Islamabad, Pakistan.

View Book:- https://stm.bookpi.org/STHSS-V8/article/view/4766

Recent Perspectives of the Impact of Financial Structure on Return on Equity: Evidence from Wholesale of Motor Vehicle Parts and Accessories Industry | Chapter 12 | Current Strategies in Economics and Management Vol.4

A widely debated topic during the last years is represented by the choice of financial structure of companies, especially in developing or emerging countries, characterized by economies without a tough and a mature financial system. The purpose of this research is to determine whether there is a relationship between capital structure and firm performance of firms active in Romania in the wholesale of motors vehicle parts and accessories (NACE 4531). Capital structure refers to how a firm chooses to finance their assets and future growth by dividing debt into subcategories (bank, commercial) and time horizon, while firm performance is evaluated by the return on equity (financial return). By determining this relationship, firms in these sectors should have a better understanding of how to select the financing for their future growth. The main output of the study consists in the fact that the financial structure divided by debt components of the companies does not influence significantly the return on equity during periods of low interest rates, like the case of Romania during 2016.

Author (s)  Details

 Mrs. Rodica Baciu
The Bucharest University of Economic Studies, Romania.

Professor Brezeanu Petre
The Bucharest University of Economic Studies, Romania.

View Book :- http://bp.bookpi.org/index.php/bpi/catalog/book/198