Factors that influence financial leverage on listed companies in bursa Malaysia / Ila Nabila Ali Badaruddin and Nurul Hidayah Ahmad Fauzi

The purpose of this study is to examine the factors of financial leverage that influence
on listed companies in Bursa Malaysia from 1995 until 2014. Factors of leverage
affected each company as it may bring harm to the company if it driven by bad
influence. The level of influences itself will show the capabilities of every company
whether they are in good condition or not. It is also important for them when they
want to apply for loan or funds. Level of leverages are very importance since it is
indicator for every company for them to go further as it will determine some
decisions such as investment, and international business. If the financial leverage of
company is too bad, this can affect the company in many aspects such as
shareholder’s trust and also in financial industries if they want to make loans. This
research is conducted due to researchers need to analyze the relationship of factors
towards leverage that influences listed companies in Bursa Malaysia. Many factors
were involved in this study, which are collateralized asset, profitability, and growth
opportunity in Malaysia. In this study, researchers used construction, consumer,
finance, plantation and trading service sectors that listed on Bursa Malaysia which
are from year 1995 to 2014. The researcher found that the collateralized asset,
profitability and growth opportunity on listed companies in Bursa Malaysia have a
positive relationship with the financial leverage. Panel data consist of secondary data
gathered Malaysia firm have been used for this study which employed Panel
Regression Fixed Effect Model. Researcher use Econometric views 9 (E-Views 9) as
medium to analyzed and interpret descriptive, normality and regression. Lastly,
researchers have come out with the conclusion and recommendation about the
research that can be done in the future.