2nd ICARE Student's Conference - 2016
Permanent URI for this collectionhttp://repository.kln.ac.lk/handle/123456789/16423
Browse
7 results
Search Results
Item An Analysis of Capital Structure and Its Impact on Performance: with Reference to Financial Institutions in Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) Balendra, V.; Madurapperuma, M.W.The capital structure of a firm is basically a combination of debt capital and equity capital. Which is deemed as appropriate to enhance its operations. A lot of investigations are being done on the implications of capital structure’s selection on organization’s value and its performance since the seminal work of Modigliani and Miller (1958). A wee little is empirically known about such implications in emerging economies such Sri Lanka. The purpose of this research is to explore empirically the impact of capital structure decisions on the financial sector organizations’ financial performance in Sri Lanka as one of emerging economies. Regression analysis is used in this research to identify the relationship between the leverage level and the performance of the financial institutions. Broad data covering the six year periods from 2009- 2015 of financial institutions in Sri Lanka are gathered and analyzed with the regression analysis. The data all are quantitative in nature and already available on Colombo stock exchange database (secondary evidence). There are sixty Financial Institutions in Sri Lanka and most of them are levered firms. Based on Return on Equity financial performance measurement and financial institutions’ leverage level the results revealed that leverage level has a weak level of negative impact and whilst controlling variable total assets has strong negative impact on organization’s financial performance.Item Determinants of Financial Performance in Micro Finance Institutions of Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) Sudharika, W.P.A.; Madurapperuma, M.W.Financial sector plays a key role in the economic development. It is generally agreed that a strong and healthy banking system is a prerequisite for sustainable economic growth. Financial sector includes mainly the banking system and the microfinance institutions in the country. Microfinance promises to reduce poverty. To achieve this amazing objective Microfinance institutions have to developed strong enough in financial performance because donor constancy is not a given. Thus the question is: In what extent the MFIspecific, industry-specific and macroeconomic factors determinants the Sri Lankan micro finance industry financial performance from the period 2010- 2015. The study was based on a six years secondary data obtained from annual reports. Regarding the explanatory variables, operational efficiency ratio, debt to equity ratio and capital assets ratio affect MFIs financial performance significantly. The outcome of the study shows that GDP growth rate and the debt equity ratio have positive relationship. But GDP growth rate statistically insignificant effect on their financial performance. The capital assets ratio, debt equity ratio and operational efficiency ratio have statically significant. The Sri Lankan MFIs policy makers and managers should give high concern to the expense management and also the government and policy makers should work combining both poverty decrease and financial self- sufficiency of MFIs. And also MFIs have to emulate profit-making banking performs by effecting a sound financial management and good managerial governance to assure their financial performance and in the long run sustainability.Item The Relationship between Credit Risk and Bank Performance: A Study of Commercial Banks in Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) Madushani, B.D.A.; Madurapperuma, M.W.Credit risk is the most important part of all commercial banks performing their works around the world. The objective of this study is to identify the relationship between credit risk and commercial banks performance in Sri Lanka. This study based on secondary data and data were obtained from various sources such as selected commercial banks annual reports, relevant articles, books and magazines etc. The panel data of a ten year period from 2006 to 2015 from the selected ten banks were used to examine the relationship between credit risk and commercial banks performance. Furthermore, Return on Assets (ROA) used as a profitability indicator while Non-Performing Loan to Total Loan Ratio (NPLR), Capital Adequacy Ratio (CAR) and Total Loan to Deposits Ratio (LTDR) used as credit risk indicators. The correlation and regression analysis was used to examine the relationship between credit risk and profitability indicators during the period and study by using E-views software. According to the empirical results, it was observed that NPLR and CAR has negative significant relationship with the commercial banks profitability and LTDR has positive significant relationship with the commercial banks profitability. Then this study concluded the credit risk has a significant relationship with the bank profitability. Therefore, this study recommended the banks to implement an effective tools and techniques to reduce the credit risk of commercial banks in Sri Lanka.Item The Impact of Public Expenditure on Economic Growth in Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) Wimalasiri, N.P.G.U.S.; Madurapperuma, M.W.The relationship between public expenditure has been one of the most searched issues in both developing and developed countries in the recent years. Public expenditure and policies related to public expenditure are important for a country and its macroeconomic stability. Hence, the objective of this study is to investigate the relationship between public expenditure and economic growth of Sri Lanka for the time period spanning from the year 1985 to 2015. A model developed by Ram (1986), as summarized by (Kweka & Morrissey, 1997) is used for the analysis. Total government expenditure is disaggregated in to three categories for the research purpose of this study as; government investment expenditure, government consumption expenditure and government human capital investment expenditure. Private investment was also added as an independent variable based on the econometric model employed for the study. All three categories of expenditure; government investment expenditure and government human capital expenditure were found to be insignificant in the regression, whereas private investment showed a positive and government consumption expenditure showed a negative significant relationship with regard to economic growth in Sri Lanka.Item Impact of Bank-Specific and Macroeconomic Determinants on Commercial Bank Profitability: with Reference to Systematically Important Private Commercial Banks in Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) Samarathunga, S.M.D.S.S.; Madurapperuma, M.W.Bank-specific and Macroeconomic factors have substantial repercussions on the performance of commercial banking sector in Sri Lanka, the favorable macroeconomic environment seems to stimulate higher profits. (Weerasainghe V.E.I.W & Perera T.R, 2013).The return on Assets which is a major measure of performance of commercial banks is a function of bankspecific determinants and macroeconomic determinants. A proper functioning of banking system facilitates a rapid economic growth enhancing savings and investments. The performance of the Sri Lankan commercial banks, measured by the Return on Assets (ROA) appeared to be stronger in the recent past without facing any significant fluctuations. This paper examined the impact of bank-specific and macroeconomic determinants on the profitability of licensed commercial banks. The study uses quarterly data from 2010-2015 relating to the bank-specific and macroeconomic indicators of commercial banking profitability by carrying out a multiple panel regression. According to empirical results, Macroeconomic determinants, gross domestic production rate and inflation rate found to be having a significant impact on the bank profitability with a positive relationship between the Return on Assets of a bank. The results further show that bank-specific factors of past period performance, net interest margin, bank size, liquidity risk, credit risk and capital adequacy have contributed significantly to the profitability of the commercial banks. The implication of the study is that efficient management of the bank-specific factors and implementation of favorable economic policies lead to an economic growth can contribute immensely to uplift the performance of the banking industry in Sri Lanka.Item The Impact of Capital Structure on Bank Performance: Evidence from Listed Commercial Banks in Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) Senavirathna, Y.G.D.N.K.; Madurapperuma, M.W.Capital structure has attracted intense debate and scholarly attention across industries in the corporate finance literature over the past decades. Nonetheless, in the context of the banking industry, this subject has received a restricted research attention. Capital structure decision is the vital one since the performance of an enterprise is directly affected by such decision. Therefore, proper care and attention required to be given while determining capital structure decision. The study investigated the impact of capital structure on performance of ten listed Sri Lankan banks over the past 11 year period from 2005 to 2015. In order to meet the objectives of this study a quantitative panel data methodology was employed. The panel data least square model was applied for the data analysis through E-Views. Findings of this study, there are a few key points that can be used to conclude this study. The findings revealed that capital structure as measured by total debt to asset had statistically no significant impact, whereas debt to equity had statistically significant positive impact on performance of core business operations of commercial banks in Sri Lanka. Furthermore Growth, spread and asset size also had statistically significant and positive relationship with performance. Moreover, banks also advised to raise equity financing so that to keep costs of financing at minimum level and hence optimize performance and the value of banks. Finally, future researchers also recommended assessing the overall performance of banks and other business sectors in the area of this research. The outcomes of the study may guide banks, loan-creditors/debtors and policy makers to formulate better policy decisions as far as the capital structure is concerned. Moreover, the study reinforces and refines the body of knowledge relating to capital structure and performance of Banks in Sri Lanka.Item Impact of Micro Finance Facilities on Financial Performances of Small Enterprises in Sri Lanka(Department of Accountancy, Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2016) Beliwaththa, H.B.P.C.; Madurapperuma, M.W.Finance is the major constraint of small enterprises to carry out their business activities. Micro finance provides a better access to the small enterprise owners to enter into the money market and fulfill their fund requirements. The micro finance concept originated in the year 1976, when Mohammad Yunus establish the Grameen bank in Bangladesh. This concept have been expanded to most of the developing countries in present. This study is an attempt to find out the impact of micro finance facilities on financial performance of small enterprises. The study aimed to evaluate the impact of financial and nonfinancial facilities provided by the micro financial institutions on financial performance of the small enterprises. Survey method was used to collect data. Population of this study is small enterprise owners in Puttalam district who are participating to any micro finance program. The study sample consisted of hundred small enterprises and Simple random sampling method was employed to select that sample. Statistical Package for the Social Sciences (SPSS) was used to analyze the data. Descriptive statistics, correlation analysis and regression analysis were used to interpret results. The study revealed that the micro finance facilities positively, impact on financial performances of the small enterprises in Sri Lanka. Further, this study found that only micro credit facilities are not enough for the development of the small enterprises. Nonfinancial facilities such as, training, operational assistance and industry related education are equally important for the growth of small enterprises.