Impact of Firm Leverage to Performance: Evidence from Shariah and Non-Shariah Compliant Companies in Malaysia
- DOI
- 10.2991/iceb-15.2015.21How to use a DOI?
- Keywords
- Firm leverage, Debt Ratio, Short Term Debt, Long Term Debt, Return on Asset, Return on Equity, Market to Book Value
- Abstract
This study are meant to investigates the impact firm leverage towards the performance of Shariah compliant listed companies with the non-compliant Shariah listed companies and to discover on their firm leverage practices from each other. A total 70 construction companies listed in Securities Commission Malaysia (SC) main board belonging to construction sector for Shariah and non-Shariah compliant listed companies are analyzed covering the period from 2008 until 2012. Using pooled ordinary least square (POLS) method and generalized least square (GLS) with random and fixed effects, the results clearly indicated that firm leverage’s choice between Shariah and non-Shariah compliant companies are totally difference. It shows that debt ratio does not give an impact towards Shariah compliant company’s performance based on return in asset (ROA) and return on equity (ROE) but short-term debt and long-term debt does give an impact to Shariah compliant company’s performance based on Market-to-book value (MTBV) with negative relationship. On the other hand, in Non-Shariah Compliance Company, inverse result shows when long-term debt and total debt does give an impact to Non-Shariah compliant company’s performance based on ROE. While, size also represent a positive relationship toward N0n-Shariah compliant company’s performance
- Copyright
- © 2015, the Authors. Published by Atlantis Press.
- Open Access
- This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).
Cite this article
TY - CONF AU - Wan Shahzlinda Shah Bt Shahar AU - Wan Shahdila Shah Bt Shahar PY - 2015/05 DA - 2015/05 TI - Impact of Firm Leverage to Performance: Evidence from Shariah and Non-Shariah Compliant Companies in Malaysia BT - Proceedings of the International Conference on Economics and Banking 2015 PB - Atlantis Press SP - 140 EP - 148 SN - 2352-5428 UR - https://doi.org/10.2991/iceb-15.2015.21 DO - 10.2991/iceb-15.2015.21 ID - ShahBtShahar2015/05 ER -