Prediction of Corporate Financial Distress: Evidence from Malaysian Listed Firms During the Asian Financial Crisis

28 Pages Posted: 28 Sep 2004

See all articles by Yusuf Karbhari

Yusuf Karbhari

Cardiff Business School

Zulkarnain Muhamad Sori

INCEIF, The Global University of Islamic Finance

Abstract

The aims of this study are twofold: (1) to formulate a model that predicts corporate financial distress and (2), to apply the model to trace the potential failure of Malaysian financially distressed firms due to the Asian Financial Crisis of 1997. The model successfully predicts firm's health at the rate of 88%. The predictive accuracy of the model reveals that it was significantly better than chance.

Keywords: Corporate distress, financial ratios, prediction model, discriminant analysis and Asian Financial Crisis

JEL Classification: M41

Suggested Citation

Karbhari, Yusuf and Muhamad Sori, Zulkarnain, Prediction of Corporate Financial Distress: Evidence from Malaysian Listed Firms During the Asian Financial Crisis. Available at SSRN: https://ssrn.com/abstract=596607 or http://dx.doi.org/10.2139/ssrn.596607

Yusuf Karbhari (Contact Author)

Cardiff Business School ( email )

Aberconway Building
Colum Drive
Cardiff, CF1 3EU
United Kingdom
+ 44 0 29 2087 6057 (Phone)
+ 44 0 29 2087 4419 (Fax)

Zulkarnain Muhamad Sori

INCEIF, The Global University of Islamic Finance ( email )

Lorong Universiti A
Kuala Lumpur, Kuala Lumpur 59100
Malaysia
+60376514173 (Phone)
8 (Fax)

HOME PAGE: http://www.inceif.org/

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