A resource dependence theory perspective on low savings, cost of capital, leverage and bank valuation in South Africa

Kengne, Sophie Kasse

doi:10.1080/17520843.2022.2033932

Cited by 1 publication

(1 citation statement)

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“…The results revealed that EUR 1 of shareholders' funds was burdened by EUR 3.520 of the total corporate assets. According to Kengne (2022), if the indicator value is 1, the firm focuses only on equity when financing its business activities. While the range of 2 to 3 is the ideal ratio, an increase in value can be linked to the firm using debt more frequently.…”

Section: Resultsmentioning

confidence: 99%

The Relevance of Sectoral Clustering in Corporate Debt Policy: The Case Study of Slovak Enterprises

Gajdosikova,

Valaskova,

Lazaroiu

2024

Administrative Sciences

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The processing and transformation of natural resources into completed and semi-finished products is the primary function of industry in each nation’s economy. There is no denying the significance of industry and sectoral classification of the economy, but the slow development and extension of one industry could have resulted in the advancement of other sectors that are now a part of contemporary communities. Since there are statistically significant differences between various industries, numerous authors are currently investigating the impact of the industry on the financial structure of firms, revealing the industry as a crucial determinant of corporate indebtedness. Thus, the main aim of this study is to determine the debt level of a sample of 4237 enterprises operating in the market in the period of 2018–2021 from various sectors using eight debt indicators, as well as to identify relationships between them, which may help to reveal sectors with homogeneous patterns of indebtedness (using the cluster analysis) and thus understand which sectors are the most stable and independent. The Kruskal–Wallis test is then used to determine if there are statistically significant differences between the calculated ratios related to the economic sector. Based on the results, it can be concluded that the choice of financial structure is significantly influenced by the industry. Financial performance and indebtedness indicators are quantitative statistics used to assess, monitor, and forecast company or sectoral financial health. They act as instruments for business insiders and outsiders to assess a company’s performance, particularly in comparison to competitors, and to pinpoint its strengths and weaknesses, making the outputs of this study important for all types of stakeholders.

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Section: Resultsmentioning

confidence: 99%