The Relationship Between Hong Leong Bank’s Performance with Leverage and Inflation

Rosli, Aini Rafiqah (2017): The Relationship Between Hong Leong Bank’s Performance with Leverage and Inflation.

Abstract

This paper are for recognize the relationship between risk and performance of Hong Leong Bank. Hong Leong Bank is one of the bank that have a good reputation in banking industry at Malaysia. Thus, it is important to shareholder knows the type of risk that faced by management of bank. The focused risk is leverage and external factor that are inflation by using profitability as the bank’s indicator which is by using ROA and current ratio. Aside that, the external factor such as inflation also give an impact to the performance of bank. The leverage and inflation are significant in business due to the direct and indirect relationship to the profitability. Therefore, this paper further examines if management have taken a serious step in maintaining the risk that will give any reflect to the profitability.

• Item Type: MPRA Paper
• Language: English
• Keywords: bank’s performance ;leverage ; inflation.
• Subjects: A - General Economics and Teaching > A1 - General Economics > A10 - General; A - General Economics and Teaching > A1 - General Economics > A12 - Relation of Economics to Other Disciplines; A - General Economics and Teaching > A1 - General Economics > A13 - Relation of Economics to Social Values; D - Microeconomics > D4 - Market Structure, Pricing, and Design; D - Microeconomics > D4 - Market Structure, Pricing, and Design > D49 - Other; E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook; E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook > E66 - General Outlook and Conditions; G - Financial Economics > G1 - General Financial Markets; G - Financial Economics > G1 - General Financial Markets > G10 - General; G - Financial Economics > G2 - Financial Institutions and Services; G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages; G - Financial Economics > G3 - Corporate Finance and Governance; G - Financial Economics > G3 - Corporate Finance and Governance > G32 - Financing Policy ; Financial Risk and Risk Management ; Capital and Ownership Structure ; Value of Firms ; Goodwill

References

Ali K. A. (2013). The impact of financial leverage on firm performance: the case on non financial firm in Kenya. Retrieved from University of Nairobi Research Archieve: http://erepository.uonbi.ac.ke/bitstream/handle/11295/75293/KALE_

Chioma D. O., Eyisi A. S., & Ebue M. I. (2015). Relationship between inflation and firms' performance- evidence from Nigeria. World Applied Science Journal, 1-9. Retrieved from https://www.idosi.org/wasj/wasj33(5)15/18.pdf

Kanwal S., & Nadeem M. (2013, December). The Impact of macroeconomic variables on the profitability of listed commercial banks in pakistan. Retrieved from European Journal of Business and Social Sciences: http://www.ejbss.com/Data/Sites/1/vol2no9december2013/ejbss-1320-13-theimpactofmacroeconomicvariables.pdf

Nadeem M., Ahmad R., Ahmed A., Ahmad N., Batool S. R., & Rehman K. U. (2015). The effect of leverage on financial health of the firms: a study from cement industry of Pakistan. Retrieved from International Knowledge Sharing Platform: file:///C:/Users/User/Downloads/22277-24787-1-PB.pdf

Rehman S. S. F. U. (2013). Relationship between financial leverage and financial performance: empirical evidence of listed sugar companies of pakistan. Retrieved from Global Journal of Management and Business & Research Finance: https://globaljournals.org/GJMBR_Volume13/4-Relationship-between-Financial.pdf

Waemustafa, W., & Abdullah, A. (2015). Mode of islamic bank financing: does effectiveness of shariah supervisory board matter?. Aust. J. Basic & Appl. Sci., 9(37): 458

Waemustafa, W., & Sukri, S. (2015). Bank specific and macroeconomics dynamic determinants of credit risk in islamic banks and conventional banks. International Journal of Economics and Financial Issues, 5(2), pp. 476-481.

Waemustafa, W., & Sukri, S. (2016). Systematic and unsystematic risk determinants of risk between Islamic and Conventional banks. International Journal of Economics and Financial Issues, issue 4, vol. 6, pp.1321-1327.