Liquidity analysis of finance companies and effect of economic indicators: a liquidity management perspective / Hezal Ahmad

Finance companies is the second largest deposit taker after commercial banks in our financial system. The finance companies also is the pioneer in the financial industry whereby they established themselves for quite some time since 1960s. Thus, it is appropriate to make a study of the finance companies performance in managing its asset and liability towards maximizing wealth without forgetting social responsibility. This study is about liquidity management in the finance companies and management of its funds. It is aimed at providing a comprehensive analysis and model of liquidity by using liquidity ratios in facing changes of the economic indicators. The significant influences (effectiveness) and relationship between the economic indicators and liquidity ratios are the major areas of the study. One major hypothesis have been tested in this study as to identify type of liquidity ratios and economic indicators that are effected by each other’s. In this case, what type of liquidity ratios are influenced (effected) by the economic Indicators and which economic indicators are the major influences.