Determinants of dividend policy towards financial sector listed in Bursa Malaysia/ Nailah Aziz

The return on investment can be divided in capital gain and dividend payout. It is a difficult task to a management to allocate a sufficient amount in both segments especially to prevent from agency or management problem. The firms pay dividends only when they meet their requirement and short term needs. Besides, dividend shows the level of condition of a firm in term of management and profitability. It reflects their credibility and image. Each shareholders hope for a high dividend payout in return to their investment and they will find the best firm in order to earn more income or profits. However, this study is aims to investigate the determinants of dividend policy towards financial sector listed in Bursa Malaysia. The factors examined in this study include firm size (log of total asset), debt, sales growth (operating profit margin), investment opportunity (INV) and return on equity (ROE). In broad, this study a total of 10 financial sector companies listed in Bursa Malaysia had been selected randomly. Panel data of period of year from 2006 until 2015 of selected financial sector companies had been used to measure the data. The results revealed the four factors that are TA, Debt and ROE have a positive significant influence on dividend per share while OPM and INV have a negative significant effect.