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PurposeThis paper aims to assess the impact of credit risk on the market values of private banks during the corona pandemic. Design/methodology/approachThis study is identifying critical issues of credit risk at six great private banks. A conceptual framework is designed based on the Tobin Q model for investigating study hypotheses. Quantitative financial analysis methods have been used for processing data, such as financial ratios, arithmetic mean and multiple linear regression. FindingsThe most important result of this study is the lack of influence of credit risk on the market value of selected banks. Because the dimensions of credit risk have critical importance in increasing or decreasing the market value, these banks must continue to adopt quantitative financial analysis to measure credit risks to avoid their risk. Originality/valueThis study elaborates the need for financial indicators to help assess the market value of banks during the economic crises caused by the closure of commercial institutions during the corona pandemic. There is continued increase in bank credit to support these institutions, borrowers and cash withdrawals, which may affect their market reputation.
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Purpose: This study aims to focus on the impact of COVID-19 on the Spanish wine sector and the financial resilience of Spanish wineries in the period 2019–2020. Design/methodology/approach: The data set contains 355 limited companies of the Spanish wine sector which were active in the period 2019–2020. The explanatory variables used are size and age of the company, exports, subsidies and gender distribution in the workforce. The financial statements of the companies are treated as compositional data, using log-ratios for asset structure, leverage, margin, turnover and debt maturity. The first-difference estimator is used for the panel-data model relating the differences in the log-ratios between 2020 and 2019 to the explanatory variables. Findings: In average terms, margin and turnover have significantly worsened between 2019 and 2020, while debt maturity has increased. A larger firm size, a greater age, a higher share of women in the workforce and subsidies have made wineries more resilient between 2019 and 2020. Originality/value: To the best of the authors' knowledge, this is the first financial statement analysis of the impact of COVID-19 in the winery sector. © 2023, Emerald Publishing Limited.
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This paper analyzes the financial situation of Ecuadorian technology companies, particularly those that provide app services, and how they were affected by the Covid 19 pandemic. The primary goal was to analyze the technology industry's financial behavior in the years 2018, 2019 and 2020, particularly companies which provide app services, by applying financial ratios of liquidity, solvency and profitability.The current liquidity ratio and the acid test ratio were applied to measure liquidity levels;the debt to assets ratio, the equity ratio, the debt to fixed assets ratio, leverage and financial leverage ratios were used to measure solvency levels;and finally, the DUPONT model, based on the net profit margin, total asset turnover and leverage were applied to determine profitability.The methodology used for this paper is the quali - quantitative method with a descriptive approach through the documentary review method.Statistical sampling was used for the finite population, based on sources such as the Internal Revenue Service website and information from the Superintendence of companies, the sample size is 20 companies which enabled a comparative and analytical study.Results showed that there were changes in consumption in e - commerce due to new needs that consumers had to adapt to, in addition to a marked growth in the number of people using these apps. In conclusion, the technology industry grew in profitability in the face of the covid-19 pandemic during the first quarter of 2020. © 2022 IEEE.
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Micro and small enterprises (MSEs) are important to the local economy and are the most crucial source of employment in Thailand. Using the three-round survey data, we assess the impact of COVID-19 on the survival probability of MSEs in the tourism and manufacturing sectors. Enter-prise characteristics such as owner characteristics, employment and business strategies are examined as potential factors to mitigate or stimulate business failures. The Cox proportional hazards model and Kaplan-Meier estimator are employed. Our findings reveal that the survival probability paths from the three rounds of survey show a gradual decrease of survival probability from the first week of interview and approximately 50% of MSEs could not survive longer than 52 weeks during the COVID-19 pandemic. We also find that the survival of MSEs mainly depends on location, number of employees, and business model adjustment, namely operation with social distancing and online marketing. Particularly, retaining employees and not reducing the working hours are one of the key factors increasing the survivability of MSEs. However, the longer length of the crisis reduces the contribution of these key factors. The longer the period of the COVID-19 pandemic, the lower the chance of MSEs survivability.
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2019 yılının ikinci yarısında Çin’de ortaya çıkan ve geçtiğimiz iki yıl boyunca, bütün dünyada ve ülkemizde etkisini gösteren Koronavirüs salgını, dünyada gelmiş geçmiş en büyük felaketi ve krizi insanoğluna yaşatmaya devam etmektedir. Salgın sebebiyle ortaya çıkmış olan krizi en ez zararla atlatabilmek için yapılan çalışmalar artarak devam etmekte olup, küresel anlamda aşının yaygın hale gelmesiyle salgına çözüm oluşturulabileceği bilim insanları tarafından dile getirilmektedir. Bu çalışma ile 2020 ve 2021 yıllarında dünyada ve ülkemizde daha önce hiç karşılaşılmayan düzeyde bir ekonomik ve sosyal durgunluğun ortaya çıkmasına sebep olan salgının Türkiye üzerine etkilerinin incelenmesi hedeflenmiştir. Çalışmada BIST kurumsal yönetim endeksi (XKURY) ve BIST Bankalar endeksinde (XBANK) yer alan toplam 11 bankanın verileri kullanılmıştır. Salgının dünyaya yayılmaya başladığı dönem “4Ç2019” olarak kabul edilmiştir. Bu sebeple çalışmaya salgın öncesindeki 5 çeyrek dönemle, salgın sürecindeki 5 çeyrek dönemin verileri analize dahil edilmiştir. n örnek sayısının 30’dan küçük olması ve aynı örneklem grubunda yer alan bankaların, farklı çeyrek dönemlerde yapılan, aktif karlılık, kaldıraç oranı, özkaynak karlılığı, kredi/mevduat oranı ve özkaynak / toplam varlık oran ölçümlerinin ortalamalarının göz önüne alınıp karşılaştırma yapılması sebebiyle istatistiksel analizlerde bağımlı örneklemler t testi kullanılmıştır. Íncelemeler sonucunda, çalışmaya konu olan bütün finansal performans göstergeleri için, salgın öncesi ve salgın sürecindeki dönemlerin arasında anlamlı farkların meydana geldiği istatistiksel olarak görülmüştür.Alternate : The Corona virus pandemic, which emerged in China in the second half of 2019 and affected the whole world, including our country, for the past two years, continues to cause humanity to experience the greatest disaster and crisis ever in the world. Studies to overcome the crisis that has arisen due to the pandemic with the least damage continue, and scientists state that a solution to the pandemic can be created with the spread of the vaccine globally. It is aimed to examine the effects of the pandemic on Turkey, which caused an unprecedented level of economic and social recession in the world and in our country in 2020 and 2021. Data of 11 banks in the BIST corporate governance index (XKURY) and BIST Banks index (XBANK) are included in the study. The period when the pandemic started to spread around the world was accepted as “Q42019”. Then, the data of the 5 quarters before the pandemic and the 5 quarters during the epidemic process were included in the analysis. The number of samples is less than 30 and the averages of financial performance criteria such as return on assets, leverage ratio, return on equity, loan/deposit ratio, and equity/total asset ratios of banks in the same sample group will be compared hence paired samples t-test was preferred in the analysis. As a result of the analyzes, it was determined that there were statistically significant differences between the periods before and during the pandemic for all financial performance indicators that were the subject of the study.
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The main purpose of this study is to investigate the best predictor of firm performance among different proxies. A sample of 287 Czech firms was taken from automobile, construction, and manufacturing sectors. Panel data of the firms was acquired from the Albertina database for the time period from 2016 to 2020. Three different proxies of firm performance, return of assets (RoA), return of equity (RoE), and return of capital employed (RoCE) were used as dependent variables. Including three proxies of firm’s performance, 16 financial ratios were measured based on the previous literature. A machine learning-based decision tree algorithm, Chi-squared Automatic Interaction Detector (CHAID), was deployed to gauge each proxy’s efficacy and examine the best proxy of the firm performance. A partitioning rule of 70:30 was maintained, which implied that 70% of the dataset was used for training and the remaining 30% for testing. The results revealed that return on assets (RoA) was detected to be a robust proxy to predict financial performance among the targeted indicators. The results and the methodology will be useful for policy-makers, stakeholders, academics and managers to take strategic business decisions and forecast financial performance.
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This paper aims to develop a model for predicting corporate bankruptcy for SMEs in the Portuguese manufacturing industry where this question remains rather unaddressed. Using profitability, activity, liquidity, leverage, and solvency ratios, it was added the size and age variables, for a group of 208 firms, including 49 bankrupt firms and 159 active firms, during the years 2011 to 2015. The logit model allowed us to estimate a model with 82.3% of predictive capacity. The most important variables identified were profitability, solvency, and size. Estimations only with the data closest to the bankruptcy date improved predictive capacity. It is evidenced that financial and non-financial variables can predict bankruptcy probability. A possible future approach would be to analyze a larger sample. Also, a larger period could be considered, allowing to test either the effects of the 2007/8 crisis or the effects of the recent economic turmoil related to Covid-19. Important for both corporate managers and investors. Conclusions may be disclosed regarding the influence that economic turmoil certainly has on corporate defaults and bankruptcies allowing its extension to other countries. The contribution of this paper is to find the best specification for a bankruptcy prediction model applied to the Portuguese manufacturing industry SMEs. This paper also contributes to the existing literature by using non-financial variables and analyzing a sector still unexplored in Portugal, albeit its conclusions can be extended to other countries. © 2022, Universiti Malaysia Sarawak. All rights reserved.
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The financial crisis, since the pandemic outbreak due to COVID-19, the dissemination and invasive systemic risk in the global financial environment have drawn the attention to organizations' solvency monitoring methods. Inevitably, in this paper we have looked at the both bankruptcy prediction and the factors that lead to bankruptcy. The dataset for this study was acquired from Kaggle, which was based on the Taiwan Economic Journal, from 1999 to 2009. The corporate statutes of the Taiwan Stock Exchange were utilized to determine a company's bankruptcy. It was a highly imbalanced dataset having 220 Non-bankrupt and 6,599 bankrupt data. We have used Random Forest, Support Vector Machine, Artificial Neural Network, XGBoost, and LightGBM classifiers regarding bankruptcy prediction. On the other hand, to find the factors that lead to bankruptcy, we did an empiric analysis for which we calculated fourteen statistical values of both bankrupted and non-bankrupted features and saw their cosine similarities. These factors will help any financial company to plan its financial ratios for preventing bankruptcy. Here we got the best performance from the Artificial Neural Network with 98.64% accuracy. And we found four factors that were responsible for the bankruptcy in our dataset. Here, the factors determining bankruptcy are crucial because by finding these factors and the likelihood of bankruptcy, companies can take the necessary steps to plan their financial ratios and ensure the solvency of their businesses. © 2022 IEEE.
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Following the prolonged economic crisis of recent years, a new economic shake-up due to the COVID-19 pandemic is under way. We consider whether banks and financial institutions may apply the same models as before for credit scoring and predicting risk. In particular, we investigate the prediction of survival or failure of Small Business Enterprises in Italy between 2008 and 2013, and between 2013 and 2018, using logistic regression models based on baseline balance sheet data. By fitting appropriate models including interaction with the time period, we identify several major differences. Notably, the Investment Rigidity Ratio was very strongly associated with failure probability in the first period but not the second, and a low Tangible Assets Ratio had a much stronger protective effect in the first period than in the second. The effect of the age of the firm also differed between the periods: younger firms were at greater risk of failure than older firms in 2008-2013 but this was not seen in 2013-2018. Especially in times of major changes, it is vital that quantitative aids to decision-making should be valid and up-to-date.
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Analysis applied in this research aimed to analyze the commercial transactions passed by the pandemic to prevent the future, the methodology started from the positivist research paradigm, type of research, non-experimental and cross-sectional field design with documentary support, research level descriptive, the population was 77,289 and the sample of 471, within which 35 industrial companies from the region 6 of the Austro were focused, controlled by the super companies, the questionnaire instrument was validated through the judgment of three experts with experience in the area of accounting, entrepreneurship and methodology, qualifying clarity, coherence and relevance. Results. Regarding the cash conversion cycle for 2020, it was 150 days late to generate cash in the generation of money in companies, likewise the profit margin for the same year was 13.35%, this ratio Financial was lower compared to the previous years 2019 and 2018, that is to say, the profit that the company achieves after deducting the operating costs were reduced, Conclusion. It was concluded that the analyzed companies had a lack of liquidity, they did not have enough money to meet liabilities and expenses, called operating fund needs, which caused a debt with financing cost to be generated. © 2022, Associacao Iberica de Sistemas e Tecnologias de Informacao. All rights reserved.
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Bu çalışmada gıda sektöründe yer alan firmaların finansal performansı, finansal rasyolar üzerinden COVID-19 öncesi ve COVID-19 dönemi ele alınarak Welch T testi eşliǧinde kapsamlı bir şekilde analiz edilmektedir. Gıda imalat sanayinde yer alan ve BÍST'e kote olan firmalara ait finansal rasyolar diǧer imalat sanayi firmaları ile karşılaştırmalı olarak ele alınmaktadır. Bu çerçevede gıda firmalarının kısa ve uzun dönemli finansal performansı diǧer imalat sanayi firmaları ile karşılaştırmalı olarak COVID-19 öncesi ve sonrası karşılaştırmalı olarak analiz edilmektedir. Elde edilen sonuçlar gıda firmalarının firma performansı anlamında bir farklılaşmanın olmadıǧını, kısa vadeli finansal performans anlamında bir farklılaşmanın olduǧunu göstermektedir. Dolayısıyla bu çalışma gıda sektörü çerçevesinde COVID-19'un etkilerini karşılaştırmalı araştırarak, Türkçe mevcut literatüre bu çerçevede katkı saǧlamayı hedeflemektedir.Alternate :In this study, the financial performance of the companies in the food industry is analyzed comprehensively by considering the pre-COVID-19 and COVID-19 periods through financial ratios, accompanied by the Welch T-test. The financial ratios of the companies in the food manufacturing industry listed on the BIST are discussed compared to other manufacturing industry companies. In this context, the short and long-term financial performance of food companies is analyzed compared to other manufacturing industry companies before and after COVID-19. The results obtained show that there is no differentiation in terms of firm performance of food companies but differentiation in terms of shortterm financial performance. Therefore, this study aims to contribute to the existing Turkish literature by comparatively researching the effects of COVID-19 within the framework of the food sector.
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The companies’ financial distress is a popular issue nowadays due to the impact of the Covid-19 pandemic recently. The Covid-19 pandemic has been greatly deteriorated and jeopardized the financial health of the companies from all sectors, including the construction sector. The analysis on the financial performance of the companies is a good indicator to determine the financial distress level of the companies. This study aims to measure the financial health of listed construction companies in Malaysia with Altman Z-score model. Altman Z-score model comprises five important and significant financial ratios that are utilized to analyze the financial distress level of the companies. The power of the Z-score model is able to categorize the financial performance of the companies into three zones, namely safe zone, grey zone or distress zone. This study is significant because it helps to identify the financial distress level of the company. Hence, the companies can take remedial actions in order to improve themselves in terms of financial health. © 2022, The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd.
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The Covid-19 Recession, which also refers to the Great Lockdown, has caused the fall of many industries in 2020. Even though this recession has somehow encouraged the booming of online business, logistics organizations still suffer from various business risks including route closure, default risk, high parcel volume, risk of the highly contagious Covid-19 virus and technological risk. The logistics industry is very prominent in moving the national economy of a country and is also the key to transport necessities and medical supplies during the Great Lockdown. Therefore, to assist logistics players in identifying their strengths and shortcomings while improving their weaknesses, this research aims to propose a research framework to optimize and compare the financial performance of listed logistics companies in Malaysia with Data Envelopment Analysis (DEA) model. This research found that 41.18% of logistics companies are efficient, namely COMPLET, GDEX, LITRAK. MISC, MMCCORP, SURIA and XINHWA. This research has also successfully found the benchmarks for inefficient logistics companies for their financial and operational enhancements. Future studies can apply this research framework with DEA model on other industries. © 2022, The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd.
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The paper examines the determinants of profitability of real estate companies by using panel data of Vietnamese listed companies on the Hanoi stock exchange (HNX) and Ho Chi Minh City stock exchange (HOSE) from 2007 to 2020. Profitability ratios are measured by return on assets (ROA) and return on equity (ROE). The results indicate that the cost on revenue ratio, debt-to-equity ratio and the crisis and COVID-19 pandemic are negatively correlated with firm profitability. Meanwhile, the sales to current assets ratio, money supply growth rate and economic growth rate (GDPG) provide a positive correlation with profitability. We find that firm size and equity to total assets have positive effects on ROA, while there is a negative relationship between equity to total assets and ROE, and not enough evidence to conclude how firm size affects ROE. The study thereby provides suggestions and recommendations for the administrators of the government, real estate companies and investors in Vietnam. © 2022 World Scientific Publishing Company.
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The airline industry is one of the largest essential industries around the globe, and has been severely affected by COVID-19 pandemic. The demand for passenger air transport decreased dramatically during the pandemic due to international and domestic travel restrictions, whereas cargo transport experienced an unsurprising increase. This paper studies the impact of COVID-19 on US domestic airlines in two categories: Legacy - American, Delta, Southwest, and United;and Cargo - FedEx and UPS. Analysis of the financial performance ratios and changes to these, both pre-pandemic and during the pandemic, is conducted and the financial performance is analyzed in five major categories (e.g. liquidity, leverage, efficiency, profitability, and market value ratios). This paper also reports empirical comparison results between financial performance of passenger and cargo airlines. The data for analysis is obtained from the US Bureau of Transportation Statistics, the Wharton Research Data Services, and Yahoo! Finance. The results in this paper may be valuable for airlines and other air transport providers as they seek to understand pandemic response/behavior, or make decisions to increase their resilience. Engineering managers involved in financial resource management decision-making may use this information in their efforts to understand the financial performance dynamics during a global pandemic, and create the greatest value for their organizations. © American Society for Engineering Management, 2021
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PurposeFinancial bankruptcy is inevitable in the tourism and hospitality ecosystem. Despite the pertinence of tourism and hospitality businesses going into bankruptcy, limited studies have investigated the early warning signs and likelihood of a financial bankruptcy occurring in tourism and hospitality firms. This study examined the predictive value of financial ratios as potential indicators in predicting bankruptcy among tourism and hospitality firms.Design/methodology/approachAltman's z-score bankruptcy prediction model was applied through five key financial ratios to predict bankruptcy of the Thomas Cook Travel Group over a ten year period (2008–2018).FindingsThe key findings of this study strongly suggest that besides the size and location of the firm, financial ratios are reliable predictors and play a pivotal role in predicting the bankruptcy of a tourism and hospitality business.Practical implicationsThe paper provides key stakeholders to adopt checks and balances to identify financial distressed tourism firms through financial ratios.Originality/valueThis is the first academic paper to inspect the financial history of Thomas Cook Travel Group in a financial ratio context, particularly following the bankruptcy of the firm in 2019.
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Over the past 15 years, the United States has faced two major economic events - the 2008 financial meltdown and the 2019 Shadow Bank crisis. Now, it faces a new financial emergency brought on by COVID-19. Financial intermediaries comprise institutions such as banks, mutual funds, insurance companies, real estate investment trusts, among others, and are a significant part of economic stability. 'Too big to fail' has become a well-known phrase. Therefore, being able to predict the financial distress of a financial intermediary is very important. Traditionally, the Altman Z-score (or a variation thereof), has been used to predict bankruptcy. It uses 5 key financial ratios to create an index score, or Z-score. Predicting financial distress, however, also accounts for companies that may not be currently on the path to bankruptcy, but may be in the future. Contemporary research has shown that combining sentiment analysis with ratio analysis improves the prediction. Our methodology uses both financial ratios and sentiment, but also includes the London Interbank Offered Rate (LIBOR), and the keywords 'Going Concern' and 'Concentration Risk'. Using a Convolutional Neural Network, we classified financial intermediaries as either distressed or not distressed with an accuracy of 88.24%. © 2021 IEEE.
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The Covid-19 pandemic has disrupted global maritime business especially maritime transportation. It has disrupted the services of transportation of cargoes using ocean vessels and directly the performance of the many businesses. The Malaysian maritime business performance has also been affected from such condition. Many of these maritime shipping companies are struggling to maintain their business financial and operations during the pandemic period. The research is intended to evaluate the financial performance of Malaysian maritime business companies during the pandemic period and rank these Malaysian maritime business companies performance during the same period. The financial report from three Malaysian maritime business companies listed in the Bursa Malaysia involved in ocean transportation has been selected for evaluation of ratios. The study was conducted by using five financial ratios to evaluate these business financial performances consisting of liquidity, profitability, activity, leverage, and return on investment. The technique for order preference by similarity to ideal solution (TOPSIS) method was being utilized to rank the performance of these maritime business. Such evaluation is able to identify which maritime businesses company is able to perform especially during a global shock period such as the Covid-19 pandemic, and the approach is able to evaluate if these maritime businesses are able to survive. The result found indicates that MISC is the shipping company which is the best performer, while Maybulk is the lowest performer during the Covid-19 pandemic. This research is able to provide insights in Malaysian maritime and how they are managing their operations and finances in ensuring their survival during a challenging period. © 2022, The Author(s), under exclusive license to Springer Nature Switzerland AG.
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The COVID 19 has brought down aviation industry to its knees. Till March 2020, before getting sense of distraction by this pandemic, Indian economy was eager to take off to reach further heights including the Aviation Sector. The growing middle class was the base reason for the prosperity in the Aviation Sector, but the pandemic has changed the whole scenario at least temporarily for next couple of years. However, even before the pandemic the history is showing that almost all Indian airlines companies are in losses. Jet Airways is almost grounded permanently whereas Kingfisher Airlines is now a history. Being one of the important sectors for the economy and even for the investors, an attempt is made to find out the reasons behind financial failure of selected Indian Aviation Companies by using Altaman's Z Score Model and Pilarski's P -Score Model and various problems faced by them. The secondary data is collected mainly by using Annual Reports of 4 leading Airlines Companies in India. Analysis is showing that various internal and external factors which are responsible for such pathetic financial position of these companies and a serious overhauling is required not only by those companies but also from the government side. © 2021by authors.