Advanced Research Journal of Banking, Economics and Finance

Advanced Research Journal of Banking, Economics and Finance (ARJBEF) ISSN 1273-2109:  Vol. 1(2), pp. 018-025, May, 2018.  © Advanced Scholars Journals

 Full length Research paper

Impacts of External Financing on The Risk Level of Viet Nam Water Industry During The Global Crisis 2007-2009

 

Dinh Tran Ngoc Huy

Banking University HCMC Viet Nam – GSIM, International University of Japan.

Email: dtnhuy2010@gmail.com

Accepted March 25, 2018

Abstract 

This paper estimates the impacts of external financing on market risk for the listed firms in the Viet nam water industry, esp. after the financial crisis 2007-2009. First, by using quantitative and analytical methods to estimate asset and equity beta of total 10 listed companies in Viet Nam water industry with a proper traditional model, we found out that the beta values, in general, for many institutions are acceptable. Second, under 3 different scenarios of changing leverage (in 2011 financial reports, 30% up and 20% down), we recognized that the risk level, measured by equity and asset beta mean, decreases (0,606) when leverage increases to 30% and vice versa. Third, by changing leverage in 3 scenarios, we recognized the dispersion of risk level decreases (measured by equity beta var) if the leverage increases to 30%. Finally, this paper provides some outcomes that could provide companies and government more evidence in establishing their policies in governance.

 KEYWORDS : equity beta, financial structure, financial crisis, risk, external financing, water industry.

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