Commerce and Management

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    Determinants of Non-Performing Loans: Evidence from Sri Lanka
    (Department of Finance, University of Kelaniya., 2022) Rathnayake, R. M. S. S.; Dissanayake, D. M. R. U.
    Purpose: The increasing trend of non-performing loans in Sri Lanka threatens the banking system. This study attempts to identify the determinants of non-performing loans in licensed commercial banks in Sri Lanka to fill the void in the finance research arena. Methodology: This study is carried out with a sample of eight licensed commercial banks using macroeconomic factors and bank-specific factors: the real interest rate, annual GDP growth rate, annual inflation rate, exchange rate, unemployment rate, the efficiency of the bank, bank size, lending rate, and ROA. Financial data were analyzed for the period of 2008-2018 using panel data regression analysis. Findings: Results show that GDP growth rate, Exchange rate, Unemployment rate, inflation rate, and bank size have a significant effect on non-performing loans in the Sri Lankan banking industry. However, bank efficiency and return on asset (ROA) do not significantly correlate with NPLs. Among these relationships, only the exchange rate shows a positive relationship with the NPL, whereas all other variables show a negative relationship. Implications: According to the study's findings, it is recommended that Sri Lankan commercial banks have their focal point on credit risk management based on maximizing return on its assets while keeping its non-performing loans within acceptable limits.
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    Examining the Role of Inflation Moderation in Mitigating the Impact of Crude Oil Prices on Indonesia's Sharia Stock Market
    (Faculty of Commerce and Management Studies, University of Kelaniya., 2023) Noval, N.; Syamsu, N.; Sofyan, S; Rifai, R. A.
    This study investigates the impact of crude oil prices on Indonesia's Sharia stock market, considering inflation as a moderating variable to address existing debates in prior research. Utilizing data from June 2011 to December 2021, including the Indonesian Sharia Stock Index (ISSI), World Texas Intermediate (WTI), and inflation, the study employs Moderated Regression Analysis (MRA) to uncover significant positive correlations between crude oil prices and the Sharia stock market. The findings highlight the moderating role of inflation, indicating that the market weakens when crude oil prices rise alongside inflation and strengthens in the absence of inflationary pressures. Practical implications suggest portfolio diversification for investors to manage associated risks. The study contributes theoretically by introducing additional moderator variables and offers empirical insights, yet acknowledges limitations, advocating for further research to deepen the understanding of the complex relationship between crude oil prices, inflation, and the Sharia Stock Market in Indonesia.
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    Inflationary Impact on Capital Structure: An Analysis of Listed Manufacturing Companies in Sri Lanka
    (Department of Commerce and Financial Management, Faculty of Commerce and Management Studies, University of Kelaniya, 2015) Chandrasena, M.R.I.N.; de Silva, G.V.G.; Maushani, B.V.N.; Samarakoon, S.M.N.S.; Samarathunga, B.H.A.I.; Fernando, K.S.R.; Samarakoon, K.M.C.; Mapitigama, K.K.P.R.
    The capital structure reflects all of the firm’s equity and debt obligations. Firm’s capital structure is determined on several factors and it is very important to lead the firm towards better and performance. Therefore determinants of capital structure obviously play an economically important role in a firm. Hence it is necessary to identify that what factors contribute to the capital structure composition. The current research is conducted to identify the relationship between determinants of the capital structure and the firm’s leverage. As identifications through literature reviews, determinants to the capital leverage (Dependent variables) are profitability, tangibility, firm size and capital intensity & Inflation. In Sri Lanka there is no any study was conducted to identify the relationship between Inflation (Independent Variable) and the capital Leverage (Dependent Variable).According to that the main objective of the present study is to identify the relationship between capital structure and its determinants with the predictor of inflation. To obtain a final conclusion, analyzed 25 manufacturing companies (Sample) listed in Colombo Stock Exchange from the population of 37 manufacturing companies listed in Colombo Stock Exchange during the period of 2010/2011 year of assessment to 2013/2014 year of assessment. Findings showed that capital intensity is a significant predictor of short term leverage, firm size is a significant variable of long term leverage and final model was rejected statistically.