Browsing by Subject "fixed effects"

Now showing 1 - 2 of 2
  • Thumbnail Image
    Item
    Open Access
    The impact of firm size and industry on capital structure decisions
    (2015) Stallkamp, Philip Robert; De Jager, Phillip
    This paper investigates the impact of firm size and industry on the capital structure of listed South African firms. It uses data obtained from firms listed on the Johannesburg Stock Exchange and tests trade-off theory and pecking order theory for firms of various sizes, firms in different industries and also tests for differences between debt maturities. Multiple fixed effect models are used to firstly test for the main factors that impact capital structure and secondly to test which sources of capital are preferred to finance a change in assets. The analysis shows that firms of different sizes and firms that operate in different industries choose their capital structure in various ways. Larger firms are more highly geared debt more than small firms and smaller firms prefer to use internally generated funds. The two main capital structure theories, trade-off and pecking order, do not explain the difference in behaviour adequately. The paper also finds that similar factors impact both long-term and short-term debt.
  • No Thumbnail Available
    Item
    Open Access
    The implications of bank risk-weighted capital and ownership on portfolio rebalancing, profitability, and stability: evidence from Tanzania
    (2024) Mchembe, Renatus Anathory; Toerien, Francois; Ndlovu Godfrey
    Banks are vital for economic growth and development as they mobilise and channel the flow of funds from surplus to deficit units and help to finance government expenditure by investing in government securities, among other activities. Bank activities are especially crucial in developing countries, due to underdeveloped financial markets, as they often dominate the financial sector. The banking crises of the last three decades have resulted in increased macroprudential regulations to protect the banking sector against the risk of failure emanating from banks' loan portfolios. A key element of these regulations is usually the prescription of minimum risk-weighted capital ratios. However, this can potentially affect bank profitability and in an attempt to rebalance their capital risk profile to match regulatory requirements, banks may alter the balance between bank lending (higher risk activities) and low risk activities, such as investment in government securities. Contradictory evidence exists on the relations