Effect of Islamic and Conventional Bonds on Firm's Performance: Evidence from Malaysia

Md Nur-Al-Ahad; Yasmin Jamadar; Ahmed Razman Abdul Latiff; Mosab I. Tabash; Asif Zaman

doi:10.1109/SIBF56821.2022.9939670

Effect of Islamic and Conventional Bonds on Firm's Performance: Evidence from Malaysia

Md Nur-Al-Ahad
, Yasmin Jamadar
, Ahmed Razman Abdul Latiff
, Mosab I. Tabash
, Asif Zaman

Cardiff School of Management

Research output: Chapter in Book/Report/Conference proceeding › Conference contribution › peer-review

1 Citation (Scopus)

Abstract

This study aims to examine the impact of Islamic and Conventional bonds on firm performance. Using Malaysian listed companies from 2010 to 2018, the results of the multiple regression analyses show that the bond affects firm performance measured by Return on Assets (ROA) and Return on Equity (ROE). Moreover, we also examine whether the bond affects the firm value (measured by EPS) or not. Results provide mixed results for both conventional and Islamic bonds. The results show that the issuance of conventional bonds positively affects the firm's performance. However, the findings also reveal that the Islamic bond-To-debt ratio negatively affects firm ROA. Next, Islamic bond has a negative effect on ROE. Further, results also reveal that the total debt ratio positively relates to firm performance. On the other hand, both conventional bonds and Islamic bonds have a negative association with the firm value. This study shows that either type of bond is good for companies up to a certain threshold. The manager should deliberate the sensitivity of Islamic bonds while investing.

Original language	English
Title of host publication	2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022
Publisher	Institute of Electrical and Electronics Engineers Inc.
Pages	108-116
Number of pages	9
ISBN (Electronic)	9781665490603
DOIs	https://doi.org/10.1109/SIBF56821.2022.9939670
Publication status	Published - 16 Nov 2022
Event	2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022 - Virtual, Online, Bahrain Duration: 12 Oct 2022 → …

Publication series

Name	2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022

Conference

Conference	2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022
Country/Territory	Bahrain
City	Virtual, Online
Period	12/10/22 → …

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 7 Affordable and Clean Energy

Keywords

capital structure
conventional bonds
Islamic bonds
Malaysia
return on asset
return on equity

Access to Document

10.1109/SIBF56821.2022.9939670

Cite this

Nur-Al-Ahad, M., Jamadar, Y., Abdul Latiff, A. R., Tabash, M. I., & Zaman, A. (2022). Effect of Islamic and Conventional Bonds on Firm's Performance: Evidence from Malaysia. In 2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022 (pp. 108-116). (2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022). Institute of Electrical and Electronics Engineers Inc.. https://doi.org/10.1109/SIBF56821.2022.9939670

Nur-Al-Ahad, Md ; Jamadar, Yasmin ; Abdul Latiff, Ahmed Razman et al. / Effect of Islamic and Conventional Bonds on Firm's Performance : Evidence from Malaysia. 2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022. Institute of Electrical and Electronics Engineers Inc., 2022. pp. 108-116 (2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022).

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title = "Effect of Islamic and Conventional Bonds on Firm's Performance: Evidence from Malaysia",

abstract = "This study aims to examine the impact of Islamic and Conventional bonds on firm performance. Using Malaysian listed companies from 2010 to 2018, the results of the multiple regression analyses show that the bond affects firm performance measured by Return on Assets (ROA) and Return on Equity (ROE). Moreover, we also examine whether the bond affects the firm value (measured by EPS) or not. Results provide mixed results for both conventional and Islamic bonds. The results show that the issuance of conventional bonds positively affects the firm's performance. However, the findings also reveal that the Islamic bond-To-debt ratio negatively affects firm ROA. Next, Islamic bond has a negative effect on ROE. Further, results also reveal that the total debt ratio positively relates to firm performance. On the other hand, both conventional bonds and Islamic bonds have a negative association with the firm value. This study shows that either type of bond is good for companies up to a certain threshold. The manager should deliberate the sensitivity of Islamic bonds while investing.",

keywords = "capital structure, conventional bonds, Islamic bonds, Malaysia, return on asset, return on equity",

author = "Md Nur-Al-Ahad and Yasmin Jamadar and \{Abdul Latiff\}, \{Ahmed Razman\} and Tabash, \{Mosab I.\} and Asif Zaman",

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Nur-Al-Ahad, M, Jamadar, Y, Abdul Latiff, AR, Tabash, MI & Zaman, A 2022, Effect of Islamic and Conventional Bonds on Firm's Performance: Evidence from Malaysia. in 2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022. 2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022, Institute of Electrical and Electronics Engineers Inc., pp. 108-116, 2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022, Virtual, Online, Bahrain, 12/10/22. https://doi.org/10.1109/SIBF56821.2022.9939670

Effect of Islamic and Conventional Bonds on Firm's Performance: Evidence from Malaysia. / Nur-Al-Ahad, Md; Jamadar, Yasmin; Abdul Latiff, Ahmed Razman et al.
2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022. Institute of Electrical and Electronics Engineers Inc., 2022. p. 108-116 (2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022).

Research output: Chapter in Book/Report/Conference proceeding › Conference contribution › peer-review

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T2 - 2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022

AU - Nur-Al-Ahad, Md

AU - Jamadar, Yasmin

AU - Abdul Latiff, Ahmed Razman

AU - Tabash, Mosab I.

AU - Zaman, Asif

PY - 2022/11/16

Y1 - 2022/11/16

N2 - This study aims to examine the impact of Islamic and Conventional bonds on firm performance. Using Malaysian listed companies from 2010 to 2018, the results of the multiple regression analyses show that the bond affects firm performance measured by Return on Assets (ROA) and Return on Equity (ROE). Moreover, we also examine whether the bond affects the firm value (measured by EPS) or not. Results provide mixed results for both conventional and Islamic bonds. The results show that the issuance of conventional bonds positively affects the firm's performance. However, the findings also reveal that the Islamic bond-To-debt ratio negatively affects firm ROA. Next, Islamic bond has a negative effect on ROE. Further, results also reveal that the total debt ratio positively relates to firm performance. On the other hand, both conventional bonds and Islamic bonds have a negative association with the firm value. This study shows that either type of bond is good for companies up to a certain threshold. The manager should deliberate the sensitivity of Islamic bonds while investing.

AB - This study aims to examine the impact of Islamic and Conventional bonds on firm performance. Using Malaysian listed companies from 2010 to 2018, the results of the multiple regression analyses show that the bond affects firm performance measured by Return on Assets (ROA) and Return on Equity (ROE). Moreover, we also examine whether the bond affects the firm value (measured by EPS) or not. Results provide mixed results for both conventional and Islamic bonds. The results show that the issuance of conventional bonds positively affects the firm's performance. However, the findings also reveal that the Islamic bond-To-debt ratio negatively affects firm ROA. Next, Islamic bond has a negative effect on ROE. Further, results also reveal that the total debt ratio positively relates to firm performance. On the other hand, both conventional bonds and Islamic bonds have a negative association with the firm value. This study shows that either type of bond is good for companies up to a certain threshold. The manager should deliberate the sensitivity of Islamic bonds while investing.

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KW - Islamic bonds

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KW - return on asset

KW - return on equity

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M3 - Conference contribution

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BT - 2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022

PB - Institute of Electrical and Electronics Engineers Inc.

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ER -

Nur-Al-Ahad M, Jamadar Y, Abdul Latiff AR, Tabash MI, Zaman A. Effect of Islamic and Conventional Bonds on Firm's Performance: Evidence from Malaysia. In 2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022. Institute of Electrical and Electronics Engineers Inc. 2022. p. 108-116. (2022 International Conference on Sustainable Islamic Business and Finance, SIBF 2022). doi: 10.1109/SIBF56821.2022.9939670

Effect of Islamic and Conventional Bonds on Firm's Performance: Evidence from Malaysia

Abstract

Publication series

Conference

UN SDGs

Keywords

Access to Document

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