The effect of financial ratio toward the performance of financial service company operated in Malaysia

Every company aim to gain profit. The purpose of this study was to examine the effect of liquidity ratio, capital structure and dividend payout ratio on the performance of financial services companies operated in Malaysia. The total of sample used is 61 companies such as banking, insurance and other financial services in Malaysia during 2013 to 2017. SPSS software was used to run the regression analysis and test the Pearson Correlation to examine the significant result between financial ratio and firm performance. Result showed that current ratio, total debt ratio and debt to equity ratio has significant effect to return on asset. Meanwhile, dividend payout ratio has negative relation with return on asset. In conclusion, liquidity ratio and capital structure has significantly effect on the performance of financial service companies operated in Malaysia.