13th Students’ Research Symposium 2023/2024

Permanent URI for this collectionhttp://repository.kln.ac.lk/handle/123456789/29096

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    The Impact of Capital Structure on Financial Performance: Evidence from Life Insurance Firms Listed on the Colombo Stock Exchange (CSE) In Sri Lanka
    (Department of Finance, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka., 2025) Devindi, G. A. H.; De Zoysa, R. P. S.
    Introduction: The optimal capital structure levels and capital structure decisions that impacts on how a firm performs have been a great dilemma for many. Capital structure decisions have an impact on the growth and profitability of a firm, as these decisions enable firms to maximize their shareholders' wealth. The major research objective was to determine to identify the impact of capital structure on the financial performance of life insurance companies listed at the CSE in Sri Lanka. Methodology: To justify the research findings, a descriptive research design was used to describe the relationship between the dependent variables and independent variables. The data collected for examination purposes was purely secondary, as it was extracted from the annual reports and financial statements of the listed firms. The target population was all the life insurance firms listed on the CSE. Eight firms were listed and formed part of the study’s population. Data analysis was done via multiple regression analysis, descriptive statistics, and correlation analysis. For the significance level of the hypothesis, a confidence interval of 95 % was used. The analytical model used was financial performance as the dependent variable, taking ROA as the measure. Total debt ratio, debt-to-equity ratio, and leverage were the independent variables. Firm size and growth rate were the control variables. The financial ratios were calculated using a Microsoft Excel spread sheet using data obtained for a seven-year period (2017–2023). Findings: The findings show debt to equity, firm size, and growth rate are all positively and significantly associated with financial performance, while total debt ratio and leverage are not significantly associated with financial performance. The findings reveal that capital structure affects the financial performance of life insurance firms at the CSE. Conclusion: In view of this, it is recommended that life insurance firms that are capable of funding their operations through retained earnings do so and reduce their borrowings, as this will boost their overall performance.
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    Influence of Company-Specific Factors on Profitability in Life Insurance Companies in Sri Lanka
    (Department of Finance, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka., 2025) Wijesinghe, S. R. S.; Sudasinghe, S. L.
    Introduction: The purpose of this study is to look into how company-specific factors influence the profitability of Sri Lankan life insurance businesses. It specifically looks at the influence of company-specific factors such as premium income, claim costs, underwriting results, and risk-based capital on profitability. The life insurance market in Sri Lanka confronts considerable hurdles in maintaining profitability, which is critical to the industry's stability and expansion. Methodology: This study uses a quantitative research design using empirical methods built under a positivist paradigm and a deductive methodology. The study uses panel data from ten life insurance companies from 2016 to 2022, using financial data derived from annual reports and IRCSL reports. The research employs a panel data regression model to determine the influence of the stated factors on profitability. Findings: The investigation, which is supported by descriptive statistics, demonstrates substantial correlations between profitability and company-specific factors. Profitability is positively influenced by premium income and risk-based capital, but claim costs have a negative influence. However, underwriting results have little influence on profitability. Conclusion: The research gives critical insights into the financial dynamics of the life insurance industry, highlighting significant factors influencing profitability. It provides stakeholders with direction on how to improve premium income strategies, optimize claims management, and strengthen risk-based capital management in order to improve financial performance and strategic decision-making.