The impact of financing combination of the profitability of insurance sector companies: an analytical study of a sample of companies listed on the Iraq Stock Exchange for the period (2014-2023)
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Abstract
This research aims to analyze the impact of Financing Combination on the profitability of insurance sector companies listed on the Iraq Stock Exchange during the period (2014-2023). The study's problem stemmed from the significance of financial structure as a key factor in determining companies' ability to achieve technical and investment returns. Alongside profitability, which serves as the dependent variable, it is considered that indebtedness and leverage ratios, representing the explanatory variables, are Important elements in this impact. Furthermore, this relationship is also influenced by other factors such as liquidity and firm size, which act as control variables, as well as operational and economic conditions. Accordingly, the study sought to test the main hypothesis stating that Financing Combination significantly impacts the profitability of Iraqi insurance companies.
to achieve this, multiple regression analysis was employed, utilizing the Pooled Mean Group (PMG) estimator within the Autoregressive Distributed Lag (ARDL) framework in (EViews) software. This model facilitates the analysis of dynamic relationships, accounting for heterogeneous short-run coefficients and homogeneous long-run coefficients. The study found that financial leverage in Iraqi insurance companies exhibits a positive long-term effect for the debt-to-total assets ratio on profitability, while demonstrating a negative long-term effect for the debt-to-equity ratio. This variation is attributed to the presence of a strong dynamic Error Correction Mechanism (ECT), which enables companies to correct structural imbalances and return to equilibrium in the long run. Consequently, the research findings confirm the validity of the hypothesis stating that the Financing Combination has a significant impact on the profitability of the Study sample companies.
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اولاً. المصادر العربية
أ. الوثائق والنشرات الرسمية
الموقع الرسمي لسوق العراق للأوراق المالية (https://www.isc.gov.iq/)
ب. الرسائل والاطاريح الجامعية
جوان، حيدر خضري، (2021)، تأثير محددات هيكل التمويل في القيمة السوقية المضافة عبر الرفع المالي والقيمة الاقتصادية المضافة: دراسة تحليلية لعينة من الشركات الصناعية المدرجة في سوق العراق للأوراق المالية"، أطروحة دكتوراه، منشورة في كلية الإدارة والاقتصاد، جامعة كربلاء، العراق.
ج. الدوريات والمجلات العلمية
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وسوف، حنان ضاهر أحمد، (2016)، "محددات الربحية في شركات التأمين: دراسة تطبيقية على شركات التأمين العامة في سورية"، بحث منشور في مجلة جامعة تشرين للبحوث والدراسات العلمية، سلسلة العلوم الاقتصادية والقانونية، المجلد i38، العدد3.
ثانياً. المصادر الأجنبية:
A. Dissertations & Thesis
Badr Ali, Walid Nabil, (2024), “Capital Structure Decision and Its Impact on the Financial Performance of Real Estate Companies Listed on the Egyptian Exchange”, Walden University.
Lehtonen, (2023), “The Impact of Financing Policies on the Profitability of Telecommunications Companies: A Case Study on Siemens Telecommunications Company”, Master’s Thesis, published at the University of South Africa. South Africa.
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Jannah Miftakhul, A, & Rochmatullah, M. R. (2024), "Analysis of the effect of company size and capital structure on the financial performance of the banking sector listed on the Indonesia Stock Exchange in 2020-2022", Jurnal Ekonomi, Vol 13, Issu 3.
Kurniawan, Setia Budi, & Nendya, Mira Aisyah, (2022), "Analysis of the Effect of Profitability, Company Growth, and Liquidity on Capital Structure: A Case Study of Indonesia", International Journal of Research in Social Science and Humanities, Vol 3, Issu 2.
Muhammad Nawzad Ali (2023), "Nabard Sharif Effect of Firm Size on the Association between Capital Structure and Profitability", Journal of Financial Economics, Vol 15, Issu 14.
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Ojomolade, Dele Jacob, Ifeanyi Joseph Ugwulali, and Adewale Joshua Adejuwon, (2023), "Capital Structure and Financial Performance: Panel Evidence from Quoted Manufacturing Firms in Nigeria (2011–2020)", African Journal of Accounting and Financial Research, Vol 6, Issue 3.
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Stegovec, Klemen, (2020). "Optimal Capital Structure and Leverage Adjustment Speed of European Public and Private Firms", Volume 22, Issue 2.
Worku, Adam Tsega, Bayleyegne, Tefera, Zenebe Berie, (2024). "Determinants of profitability of insurance companies in Ethiopia: Evidence from insurance companies from 2011 to 2020 years", Journal of InEchotion and Entrepreneurship, Volume 13, Issue 4.
C. BOOKS
Quiry, P., Dallocchio, M., Fur, Y. L., Salvi, A. (2018). Corporate Finance Theory and Practice: John Wiley & Sons, Ltd.
D. Conferences
Lamichhane, S, (2023), "A study on the impact of leverage on profitability: Evidence from the manufacturing companies listed in Nepalese", Working Papers, Stock Exchange. Available at SSRN: https://ssrn.com/abstract=4578856.