IDEAS home Printed from https://ideas.repec.org/a/taf/oabmxx/v8y2021i1p1951110.html
   My bibliography  Save this article

Financial distress and its determinants: Evidence from insurance companies in Ethiopia

Author

Listed:
  • Yonas Nigussie Isayas

Abstract

This research is aimed to investigate the determinants of financial distress of insurance companies in Ethiopia using balanced panel data from eleven insurance companies for the period covering from 2008 to 2019. A quantitative approach and explanatory design were employed to realize the stated objectives. To achieve the study objectives, secondary data were collected from annual financial statements of sampled insurance companies for the stated period and analyzed using descriptive statistics and a random effect (RE) regression model. The descriptive statistics output of the study revealed that sampled insurance companies are in the safe zone. The RE regression model results show that profitability, firm size, leverage, and company age were negatively correlated to financial distress having a strong negative effect on financial distress. On the other hand, asset tangibility and loss ratio have a positive and statistically significant effect on insurance companies’ financial distress. Based on the analysis of findings, the study suggests that Insurance Companies in Ethiopia shall be more concerned about the internal environment (factors) while developing policies and strategies to manage the financial distress condition.

Suggested Citation

  • Yonas Nigussie Isayas, 2021. "Financial distress and its determinants: Evidence from insurance companies in Ethiopia," Cogent Business & Management, Taylor & Francis Journals, vol. 8(1), pages 1951110-195, January.
    • Handle: RePEc:taf:oabmxx:v:8:y:2021:i:1:p:1951110
    DOI: 10.1080/23311975.2021.1951110
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/23311975.2021.1951110
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/23311975.2021.1951110?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sadia Rashid & Kanwal Iqbal Khan & Adeel Nasir & Tayyiba Rashid, 2022. "Unveiling living dead: characteristics and consequences of zombie firms," Cogent Business & Management, Taylor & Francis Journals, vol. 9(1), pages 2121240-212, December.
    2. Geoffrey Ngetich Iletaach & Dr. Penina Langat & Dr. Gichuki Kingori, 2024. "Assessing the Impact of Asset Quality on Financial Performance: A Study of Kenyan Deposit Taking SACCOs," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(8), pages 2479-2492, August.
    3. Vuong, Giang Thi Huong & Nguyen, Phuc Van & Barky, Walid & Nguyen, Manh Huu, 2024. "Stock return volatility and financial distress: Moderating roles of ownership structure, managerial ability, and financial constraints," International Review of Economics & Finance, Elsevier, vol. 91(C), pages 634-652.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:oabmxx:v:8:y:2021:i:1:p:1951110. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://cogentoa.tandfonline.com/OABM20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.