Research articles for the 2020-01-03
An Evaluation of Financial Performance of Commercial Banks
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Banks are one of the important players in the financial system in any economy. This study evaluate the financial performance of commercial banks in Bahrain. This study is based on eight commercial banks for the period from 2005 to 2015. The data used in this study are obtained from published annual reports and websites of the respective banks, investor’s guide, newspaper, newsletters of the banks and from Central Bank of Bahrain website. We used regression, correlation analysis & t-tests to determine the relationship between different financial parameters. The results of the study indicate that the profitability has an impact on capital adequacy and financial leverage, whereas the study did not ratify the relationship between the profitability and efficiency of the banks. This study also reveals that enforcement of higher capital adequacy ratio will adversely affects the profitability of the banks. The impact of financial and oil crisis might have influenced the financial leverage of the banks there by resulted in an adverse effect on the profitability of the banks.
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Banks are one of the important players in the financial system in any economy. This study evaluate the financial performance of commercial banks in Bahrain. This study is based on eight commercial banks for the period from 2005 to 2015. The data used in this study are obtained from published annual reports and websites of the respective banks, investor’s guide, newspaper, newsletters of the banks and from Central Bank of Bahrain website. We used regression, correlation analysis & t-tests to determine the relationship between different financial parameters. The results of the study indicate that the profitability has an impact on capital adequacy and financial leverage, whereas the study did not ratify the relationship between the profitability and efficiency of the banks. This study also reveals that enforcement of higher capital adequacy ratio will adversely affects the profitability of the banks. The impact of financial and oil crisis might have influenced the financial leverage of the banks there by resulted in an adverse effect on the profitability of the banks.
Analyst Reaction to Nonarticulation Between the Statement of Cash Flows and the Balance Sheet
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We investigate the effect of non-articulation on analyst earnings forecast quality. We look for evidence on the relationship between non-articulation and analyst earnings forecast properties: forecast inaccuracy, forecast dispersion, and forecast bias. As we would expect that non-articulation obscures accounting information available to analysts, we posit that non-articulation increases forecast inaccuracy and forecast dispersion.
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We investigate the effect of non-articulation on analyst earnings forecast quality. We look for evidence on the relationship between non-articulation and analyst earnings forecast properties: forecast inaccuracy, forecast dispersion, and forecast bias. As we would expect that non-articulation obscures accounting information available to analysts, we posit that non-articulation increases forecast inaccuracy and forecast dispersion.
Capital Management Risk and Value of the Firm: Perspectives from Private Equity Financial Firms in Kenya
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Purpose: This study sought to explore the effect of capital management risk on value of the firm among private equity financial firms in Kenya. Design/methodology/approach: Anchored on the agency theory and guided by positivism research philosophy, descriptive research design as well as causal research design, the study surveyed 115 savings and credit societies regulated by Sacco Societies Regulatory Authority. A panel regression model detailing the interaction between capital risk management and firm's value was set. Findings: The study found that capital management risk significantly affects value of SACCOs in Kenya such that a unit change in capital adequacy ratio increases value of SACCO. Originality/value: The results of the study supported the propositions of agency theory which postulates that goal incongruence and asymmetric information may generate agency problems forcing the owners of the firm to incur agency costs which reduce the cash flows available for investment leading to sub-optimization and thus reducing the value of the firm. We recommend management of SACCOs in Kenya to seek to improve their capital adequacy ratio by increasing their tier one and tier two capital so as to increase their overall core capital.
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Purpose: This study sought to explore the effect of capital management risk on value of the firm among private equity financial firms in Kenya. Design/methodology/approach: Anchored on the agency theory and guided by positivism research philosophy, descriptive research design as well as causal research design, the study surveyed 115 savings and credit societies regulated by Sacco Societies Regulatory Authority. A panel regression model detailing the interaction between capital risk management and firm's value was set. Findings: The study found that capital management risk significantly affects value of SACCOs in Kenya such that a unit change in capital adequacy ratio increases value of SACCO. Originality/value: The results of the study supported the propositions of agency theory which postulates that goal incongruence and asymmetric information may generate agency problems forcing the owners of the firm to incur agency costs which reduce the cash flows available for investment leading to sub-optimization and thus reducing the value of the firm. We recommend management of SACCOs in Kenya to seek to improve their capital adequacy ratio by increasing their tier one and tier two capital so as to increase their overall core capital.
Corporate Governance, Impact of Company’s Performance and Risk of Mitsubishi Electric Corporation
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Corporate governance is a significant part in a company. It is essential for a company to manage the business and affairs of company. The study attempts to determine corporate governance, the impact of company performance and risk of Mitsubishi Electric Corporation. The study also attempts to determine impact of internal factors and external factors influencing company’s performance. This review is to evaluate the value of profitability and operating margin. This research involved relationship between corporate governance, company’s performance, and risk of Mitsubishi Electric Corporation within five years which is from 2014 to 2018. This companies were from electronic industry and data was collected from Mitsubishi Electric Corporation’s annual report. This ratios calculated were the return on assets (ROA), quick ratio, current ratio, average-collection period, debt to income, operational ratio, operating margin, and external factors (gross domestic product (GDP), inflation rate, interest rate and exchange rate). Conclusion based on profitability and operating margin of company. This study advice that company should be manage own business effectively and more compliance with principles of corporate governance.
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Corporate governance is a significant part in a company. It is essential for a company to manage the business and affairs of company. The study attempts to determine corporate governance, the impact of company performance and risk of Mitsubishi Electric Corporation. The study also attempts to determine impact of internal factors and external factors influencing company’s performance. This review is to evaluate the value of profitability and operating margin. This research involved relationship between corporate governance, company’s performance, and risk of Mitsubishi Electric Corporation within five years which is from 2014 to 2018. This companies were from electronic industry and data was collected from Mitsubishi Electric Corporation’s annual report. This ratios calculated were the return on assets (ROA), quick ratio, current ratio, average-collection period, debt to income, operational ratio, operating margin, and external factors (gross domestic product (GDP), inflation rate, interest rate and exchange rate). Conclusion based on profitability and operating margin of company. This study advice that company should be manage own business effectively and more compliance with principles of corporate governance.
Decentralization and Mutual Liability Rules
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This paper builds on the recent work of Groote Schaarsberg, Reijnierse and Borm (2018) on mutual liability problems. In essence, a mutual liability problem comprises a financial network in which agents may have both monetary individual assets and mutual liabilities. Here mutual liabilities reflect rightful monetary obligations from past bilateral transactions. To settle these liabilities by reallocating the individual assets, mutual liability rules are analyzed that are based on centralized bilateral transfer schemes which use a certain bankruptcy rule as its leading allocation mechanism. In this paper we derive a new characterization of mutual liability rules by taking a decentralized approach instead, which is based on a recursive individual settlement procedure. We show that for bankruptcy rules that satisfy composition, this decentralized procedure always leads to the same allocation as the one prescribed by the corresponding mutual liability rule based on centralized bilateral transfer schemes.
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This paper builds on the recent work of Groote Schaarsberg, Reijnierse and Borm (2018) on mutual liability problems. In essence, a mutual liability problem comprises a financial network in which agents may have both monetary individual assets and mutual liabilities. Here mutual liabilities reflect rightful monetary obligations from past bilateral transactions. To settle these liabilities by reallocating the individual assets, mutual liability rules are analyzed that are based on centralized bilateral transfer schemes which use a certain bankruptcy rule as its leading allocation mechanism. In this paper we derive a new characterization of mutual liability rules by taking a decentralized approach instead, which is based on a recursive individual settlement procedure. We show that for bankruptcy rules that satisfy composition, this decentralized procedure always leads to the same allocation as the one prescribed by the corresponding mutual liability rule based on centralized bilateral transfer schemes.
Discussion of ‘The Formation of Hidden Negative Capital in Banking’ by Kostrov and Mamonov (2019) (Presentation Slides)
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The note conveys my remarks regarding the recent paper by Kostrov and Mamonov (2019) presented at the 9th Annual CInSt Workhop "Banking in emerging markets: challenges and opportunities".
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The note conveys my remarks regarding the recent paper by Kostrov and Mamonov (2019) presented at the 9th Annual CInSt Workhop "Banking in emerging markets: challenges and opportunities".
Efficient Capital Regulation of US Bank Holding Companies: An Integrative Literature Review
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Background: Most Bank holding companies (BHCs) sustains significant losses and increased risk exposure which caused them to become insolvent. BHCs that become insolvent have a negative impact on the U.S. economy. There is a lack of effective practice towards capital regulation that causes BHC to incur significant losses.Methodology: This integrative literature review focused on studying current research findings on efficient capital regulation practices in relation to governance, risk management, internal control, assurance and compliance in BHCs. A wide range of search terms was used to extract and select pertinent peer-reviewed literature from numerous search engines and databases, with emphasis on studies published within the past 5 years.Findings: This integrative literature review provides in-depth knowledge of capital regulation, governance, risk management, internal control, assurance and compliance practices in BHCs. An effective practice towards capital regulation may help senior bank managers reduce risky behaviors and investments that causes significant bank losses. Originality: This integrative literature review can be used by future researchers as foundational material to extend theoretical foundations and the results of related studies. It has helped to highlight Compliance and Ethics Group's standard' concepts and inform recommendation for future research that identifies effective practices towards capital regulation in BHCs.
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Background: Most Bank holding companies (BHCs) sustains significant losses and increased risk exposure which caused them to become insolvent. BHCs that become insolvent have a negative impact on the U.S. economy. There is a lack of effective practice towards capital regulation that causes BHC to incur significant losses.Methodology: This integrative literature review focused on studying current research findings on efficient capital regulation practices in relation to governance, risk management, internal control, assurance and compliance in BHCs. A wide range of search terms was used to extract and select pertinent peer-reviewed literature from numerous search engines and databases, with emphasis on studies published within the past 5 years.Findings: This integrative literature review provides in-depth knowledge of capital regulation, governance, risk management, internal control, assurance and compliance practices in BHCs. An effective practice towards capital regulation may help senior bank managers reduce risky behaviors and investments that causes significant bank losses. Originality: This integrative literature review can be used by future researchers as foundational material to extend theoretical foundations and the results of related studies. It has helped to highlight Compliance and Ethics Group's standard' concepts and inform recommendation for future research that identifies effective practices towards capital regulation in BHCs.
Enforcement of Optimal Disclosure Rules in the Presence of Moral Hazard
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This paper analyzes the role of disclosure enforcement mechanisms (such as SEC enforcement teams and corporate governance systems) in directing the disclosure practices of managers when the information is used by shareholders to monitor the manager. The paper establishes a role for a disclosure enforcement system by showing that in its absence it is impossible to simultaneously induce a manager to adopt the desirable disclosure strategy and use the disclosure efficiently to monitor him. The paper shows how the effectiveness of the disclosure enforcement system and the cost of disclosure influence (i) the economic viability of the disclosure enforcement system, (ii) the disclosure policy of the manager, and (iii) the value of including stock options in the manager’s compensation package.
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This paper analyzes the role of disclosure enforcement mechanisms (such as SEC enforcement teams and corporate governance systems) in directing the disclosure practices of managers when the information is used by shareholders to monitor the manager. The paper establishes a role for a disclosure enforcement system by showing that in its absence it is impossible to simultaneously induce a manager to adopt the desirable disclosure strategy and use the disclosure efficiently to monitor him. The paper shows how the effectiveness of the disclosure enforcement system and the cost of disclosure influence (i) the economic viability of the disclosure enforcement system, (ii) the disclosure policy of the manager, and (iii) the value of including stock options in the manager’s compensation package.
Financially Constrained Firms: The Impact Of Managerial Optimism And Corporate Investment - The Case Of Greece
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Purpose: The purpose of this paper is to examine the impact of managerial optimism on corporate investment regarding the financially constrained firms for the case of Greece. Taking as a fact that managers principally are optimistic and often overconfident an effort is made to highlight the effect of this psychological bias on managerial investment decision â€" making. Design/methodology/approach: The research methodology is based on the approach that the investment-cash flow sensitivity of firms with optimistic managers is more pronounced in financially constrained (equity dependent) firms. Data is gathered from the stock market as well as from balance sheets and cash flow statements for all firms of the sample. Focus is placed on every firm's annual report in order to gather all necessary data for the methodology. Additionally, stock prices are classified on an everyday basis for all firms for the years from 2007 to 2012. Fixed effects panel regression of capital expenditures on several control variables is used among all stocks of the sample's 184 non-financial firms with the highest financial constraints in order to examine the impact of the behaviour of optimistic managers to firm financial constraints. Findings: Constrained firms exhibit a lower profitability, a lower pay-out ratio, a lower excess value, and are more likely to be financially distressed. The empirical findings clearly show that the investment-cash flow sensitivity of firms with optimistic managers is more pronounced in financially constrained (equity dependent) firms. The difference between unconstrained firms and constrained firms is that on one hand unconstrained firms, with more cash flow, tend to use debt in order to increase both their investment as well as their dividend payment, and on the other hand, constrained firms have to choose whether to apportion their cash flow to investment or dividend payments. Research limitations/implications: In this study the regressions that were run were for the whole of the 6-year period of 2007 to 2012. However, testing each year individually could provide researchers with the ability to compare different results, to find out whether there was anything special statistically for each specific year and maybe test the period after the year 2010 when the Greek crisis had started to come up on the horizon. Additionally, supplementary research is proposed regarding the impact of managerial optimism in order to examine its impact on the whole range of decisions that managers have to make. Originality/value: As part of the literature which links psychological and economic variables to test behavioural finance models, this paper is the first to investigate managerial optimism and its impact on corporate investment in Greece. The importance of this study lie in finding how managerial decision making works within a firm, how biased a manager is when he has to make extremely important decisions regarding the firm's future performance and success, and how managerial optimism affects corporate investment decision-making especially in financially constrained firms.
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Purpose: The purpose of this paper is to examine the impact of managerial optimism on corporate investment regarding the financially constrained firms for the case of Greece. Taking as a fact that managers principally are optimistic and often overconfident an effort is made to highlight the effect of this psychological bias on managerial investment decision â€" making. Design/methodology/approach: The research methodology is based on the approach that the investment-cash flow sensitivity of firms with optimistic managers is more pronounced in financially constrained (equity dependent) firms. Data is gathered from the stock market as well as from balance sheets and cash flow statements for all firms of the sample. Focus is placed on every firm's annual report in order to gather all necessary data for the methodology. Additionally, stock prices are classified on an everyday basis for all firms for the years from 2007 to 2012. Fixed effects panel regression of capital expenditures on several control variables is used among all stocks of the sample's 184 non-financial firms with the highest financial constraints in order to examine the impact of the behaviour of optimistic managers to firm financial constraints. Findings: Constrained firms exhibit a lower profitability, a lower pay-out ratio, a lower excess value, and are more likely to be financially distressed. The empirical findings clearly show that the investment-cash flow sensitivity of firms with optimistic managers is more pronounced in financially constrained (equity dependent) firms. The difference between unconstrained firms and constrained firms is that on one hand unconstrained firms, with more cash flow, tend to use debt in order to increase both their investment as well as their dividend payment, and on the other hand, constrained firms have to choose whether to apportion their cash flow to investment or dividend payments. Research limitations/implications: In this study the regressions that were run were for the whole of the 6-year period of 2007 to 2012. However, testing each year individually could provide researchers with the ability to compare different results, to find out whether there was anything special statistically for each specific year and maybe test the period after the year 2010 when the Greek crisis had started to come up on the horizon. Additionally, supplementary research is proposed regarding the impact of managerial optimism in order to examine its impact on the whole range of decisions that managers have to make. Originality/value: As part of the literature which links psychological and economic variables to test behavioural finance models, this paper is the first to investigate managerial optimism and its impact on corporate investment in Greece. The importance of this study lie in finding how managerial decision making works within a firm, how biased a manager is when he has to make extremely important decisions regarding the firm's future performance and success, and how managerial optimism affects corporate investment decision-making especially in financially constrained firms.
Forecasting with a Panel Tobit Model
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We use a dynamic panel Tobit model with heteroskedasticity to generate point, set, and density forecasts for a large cross-section of short time series of censored observations. Our fully Bayesian approach allows us to flexibly estimate the cross-sectional distribution of heterogeneous coefficients and then implicitly use this distribution as prior to construct Bayes forecasts for the individual time series. We construct set forecasts that explicitly target the average coverage probability for the cross-section. We present a novel application in which we forecast bank-level charge-off rates for credit card and residential real estate loans, comparing various versions of the panel Tobit model.
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We use a dynamic panel Tobit model with heteroskedasticity to generate point, set, and density forecasts for a large cross-section of short time series of censored observations. Our fully Bayesian approach allows us to flexibly estimate the cross-sectional distribution of heterogeneous coefficients and then implicitly use this distribution as prior to construct Bayes forecasts for the individual time series. We construct set forecasts that explicitly target the average coverage probability for the cross-section. We present a novel application in which we forecast bank-level charge-off rates for credit card and residential real estate loans, comparing various versions of the panel Tobit model.
Impact of Financial and Oil Price Crisis on the Financial Performance of Selected Banks in Bahrain
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This paper focuses on analysing the impact of financial and oil price crisis on the financial performance of selected banks in Bahrain.We selected a sample of seven commercial banks out of which three Islamic banks and four conventional banks. The study covered a period of eleven years, from 2005 to 2015.We used ratio, descriptive statistics and single factor ANOVA. The financial performance of banks in terms of profitability, efficiency, leverage and liquidity is analysed through ratios. We found that there was not much impact on the financial performance of the banks during the crisis and pre-crisis period but the impact was observed in postfinancial crisis. The oil price crisis has an impact on the financial performance of banks all the banks. Moreover, it was observed that there is a difference in the financial performance of individual banks during the crisis period.
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This paper focuses on analysing the impact of financial and oil price crisis on the financial performance of selected banks in Bahrain.We selected a sample of seven commercial banks out of which three Islamic banks and four conventional banks. The study covered a period of eleven years, from 2005 to 2015.We used ratio, descriptive statistics and single factor ANOVA. The financial performance of banks in terms of profitability, efficiency, leverage and liquidity is analysed through ratios. We found that there was not much impact on the financial performance of the banks during the crisis and pre-crisis period but the impact was observed in postfinancial crisis. The oil price crisis has an impact on the financial performance of banks all the banks. Moreover, it was observed that there is a difference in the financial performance of individual banks during the crisis period.
Market Reaction to Earnings Information: An Empirical Study
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This paper examines semi-strong form of efficient market hypothesis by taking September 2001 quarter earnings announcement as an event. The study is based on 146 companies having minimum 20 percent foreign holdings. We have used event study methodology, t test, Runs test and sign test to test the semi-strong form of efficient market hypothesis. We have used both raw returns and log returns. The behaviour of AARs and CAARs are examined for 30 days before and 31 days after the announcement of quarterly earnings. The results of the study revealed that Indian stock market is not efficient in semi-strong form of efficient market hypothesis. Efficient market hypothesis, stock price reactions to earnings announcements, average abnormal returns, cumulative average abnormal returns, semi-strong form of EMH.
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This paper examines semi-strong form of efficient market hypothesis by taking September 2001 quarter earnings announcement as an event. The study is based on 146 companies having minimum 20 percent foreign holdings. We have used event study methodology, t test, Runs test and sign test to test the semi-strong form of efficient market hypothesis. We have used both raw returns and log returns. The behaviour of AARs and CAARs are examined for 30 days before and 31 days after the announcement of quarterly earnings. The results of the study revealed that Indian stock market is not efficient in semi-strong form of efficient market hypothesis. Efficient market hypothesis, stock price reactions to earnings announcements, average abnormal returns, cumulative average abnormal returns, semi-strong form of EMH.
Predicting Corporate Bankruptcy: A Cross-Sectoral Empirical Study - The Case of Greece
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Purpose: This article explores the prediction of bankruptcy of Greek companies, in particular of the manufacturing industry, wholesale, retail and service sectors. Design/methodology/approach: The Probit model was developed so as to try to highlight the differences in the predictive capacity of the model across the sectors but also to investigate any differences in the behavior of the financial indicators used in the model. Moreover, for the selection of these indicators, the technique of factor analysis was applied. Findings: The results showed significant explanatory capacity of the model in the four key sectors of the Greek economy up to four years before failure and bankruptcy, as well as a clear differentiation in the sector classification of companies.Research limitations/implications: This work can be used by managers, banks as well as by practitioners to identify the causes of firm’s failure. Originality/value: The limited investigation, to date, of the effects of sectoral features and the absence of sectoral samples of bankrupt companies with a higher degree of homogeneity in predicting bankruptcy may often lead prediction models to unreliable results. This paper has two main contributions to the relevant literature. At first, it serves as a work of distinguishing the differences between bankruptcy predictive power of the same financial indicators of enterprises belonging to different sectors. Secondly, the use of factor analysis in the selecting procedure of the appropriate variables provides better and more robust results in the field of bankruptcy prediction.
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Purpose: This article explores the prediction of bankruptcy of Greek companies, in particular of the manufacturing industry, wholesale, retail and service sectors. Design/methodology/approach: The Probit model was developed so as to try to highlight the differences in the predictive capacity of the model across the sectors but also to investigate any differences in the behavior of the financial indicators used in the model. Moreover, for the selection of these indicators, the technique of factor analysis was applied. Findings: The results showed significant explanatory capacity of the model in the four key sectors of the Greek economy up to four years before failure and bankruptcy, as well as a clear differentiation in the sector classification of companies.Research limitations/implications: This work can be used by managers, banks as well as by practitioners to identify the causes of firm’s failure. Originality/value: The limited investigation, to date, of the effects of sectoral features and the absence of sectoral samples of bankrupt companies with a higher degree of homogeneity in predicting bankruptcy may often lead prediction models to unreliable results. This paper has two main contributions to the relevant literature. At first, it serves as a work of distinguishing the differences between bankruptcy predictive power of the same financial indicators of enterprises belonging to different sectors. Secondly, the use of factor analysis in the selecting procedure of the appropriate variables provides better and more robust results in the field of bankruptcy prediction.
Reaction of Stock Prices to Earnings Announcements
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Speed of stock price response is important because if response is slow, the informed and alert investors would exploit it to earn abnormal returns by outperforming the market. This implies that market is inefficient in the semi-strong form. The study tests the reaction Indian stock market reaction to June 2014 quarterly financial results announcement. The study is based on 98 companies. The researcher used event study methodology. The behaviour of average abnormal returns (AARs) and cumulative average abnormal returns (CAARs) are examined for 30 days prior to and 31 days after the announcement of quarterly financial results. Runs test, sign test and t-test statistics on AARs are statistically not significant. However, t-values on CAARs are statistically significant. Therefore, we conclude that Indian stock market is not efficient in the semi-strong form.
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Speed of stock price response is important because if response is slow, the informed and alert investors would exploit it to earn abnormal returns by outperforming the market. This implies that market is inefficient in the semi-strong form. The study tests the reaction Indian stock market reaction to June 2014 quarterly financial results announcement. The study is based on 98 companies. The researcher used event study methodology. The behaviour of average abnormal returns (AARs) and cumulative average abnormal returns (CAARs) are examined for 30 days prior to and 31 days after the announcement of quarterly financial results. Runs test, sign test and t-test statistics on AARs are statistically not significant. However, t-values on CAARs are statistically significant. Therefore, we conclude that Indian stock market is not efficient in the semi-strong form.
The Effect of Public and Private Health Expenditures on Life Expectancy in Different Countries: Using Panel Data Model
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Purpose: This study aims to examine the factors that form the commitment. Design/methodology/approach: The sampling technique used is proportionate stratified random sampling, with 100 respondents and the data collection happens in 2018. Methods of data analysis in this study uses multiple linear regression, with the number of respondents as many as 100 employees. Findings: The result shows that the competence and organizational culture significantly influence the commitment. This implies to the manager that the increase of employee competence and the suitable organization culture are very important in strengthening their employee commitment. Research limitations/implications: The limitation of this research is in the amount of variables that are only three, and only focus in one object. Originality/value: The findings of this research are the new ones, by developing the previous theory, using a new place and time.
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Purpose: This study aims to examine the factors that form the commitment. Design/methodology/approach: The sampling technique used is proportionate stratified random sampling, with 100 respondents and the data collection happens in 2018. Methods of data analysis in this study uses multiple linear regression, with the number of respondents as many as 100 employees. Findings: The result shows that the competence and organizational culture significantly influence the commitment. This implies to the manager that the increase of employee competence and the suitable organization culture are very important in strengthening their employee commitment. Research limitations/implications: The limitation of this research is in the amount of variables that are only three, and only focus in one object. Originality/value: The findings of this research are the new ones, by developing the previous theory, using a new place and time.
The Model of Forming Employee Commitment In General Hospital Tgk Chik Ditiro in Pidie
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Purpose: This study aims to examine the factors that form the commitment. Design/methodology/approach: The sampling technique used is proportionate stratified random sampling, with 100 respondents and the data collection happens in 2018. Methods of data analysis in this study uses multiple linear regression, with the number of respondents as many as 100 employees. Findings: The result shows that the competence and organizational culture significantly influence the commitment. This implies to the manager that the increase of employee competence and the suitable organization culture are very important in strengthening their employee commitment. Research limitations/implications: The limitation of this research is in the amount of variables that are only three, and only focus in one object. Originality/value: The findings of this research are the new ones, by developing the previous theory, using a new place and time.
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Purpose: This study aims to examine the factors that form the commitment. Design/methodology/approach: The sampling technique used is proportionate stratified random sampling, with 100 respondents and the data collection happens in 2018. Methods of data analysis in this study uses multiple linear regression, with the number of respondents as many as 100 employees. Findings: The result shows that the competence and organizational culture significantly influence the commitment. This implies to the manager that the increase of employee competence and the suitable organization culture are very important in strengthening their employee commitment. Research limitations/implications: The limitation of this research is in the amount of variables that are only three, and only focus in one object. Originality/value: The findings of this research are the new ones, by developing the previous theory, using a new place and time.
The Reaction of Bahrain Bourse to Announcement of Annual Financial Results
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The study tests the reaction of Bahrain Bourse to 2014 annual financial results announcement. The study is based on 30 companies. The researcher used event study methodology. The behaviour of average abnormal returns (AARs) and cumulative average abnormal returns (CAARs) are examined for 30 days prior to and 31 days after the announcement of annual financial results. Runs test, sign test and t-test statistics on AARs are statistically not significant. However, t-values on CAARs are statistically significant. Therefore, we conclude that Bahrain Bourse is not efficient in the semi-strong form. The findings help market regulators to initiate measures to ensure market efficiency.
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The study tests the reaction of Bahrain Bourse to 2014 annual financial results announcement. The study is based on 30 companies. The researcher used event study methodology. The behaviour of average abnormal returns (AARs) and cumulative average abnormal returns (CAARs) are examined for 30 days prior to and 31 days after the announcement of annual financial results. Runs test, sign test and t-test statistics on AARs are statistically not significant. However, t-values on CAARs are statistically significant. Therefore, we conclude that Bahrain Bourse is not efficient in the semi-strong form. The findings help market regulators to initiate measures to ensure market efficiency.
