Predicting Financial Distress for Listed MENA Firms

Osama El-Ansary, Lina Bassam

Abstract


Financial distress prediction gives an early warning about defaulting risk for firms; thus, it is a real concern of the entire economy.

Purpose: To examine the determinants of financial distress across MENA region countries, by using definitions of distress and historical data from active listed firms in the region.

Methodology: logistic regression is run on firm-specific variables and a set of macroeconomic variables to develop a prediction model to examine the effect of these predictors on the probability of financial distress.

Findings: it has been found that after controlling for country effects, accounting ratios, firm size, and macroeconomic variables provided an acceptable prediction model for listed MENA firms.

Originality: a gap exists in the literature of developing countries’ prediction for financial distress. Many studies addressed bankruptcy prediction for a certain country in the region, however, a limited number of researches approached predicting distressed models for listed firms in the region.


Full Text:

PDF


DOI: https://doi.org/10.5296/ijafr.v9i2.14542

Refbacks

  • There are currently no refbacks.


To make sure that you can receive messages from us, please add the 'macrothink.org' domain to your e-mail 'safe list'. If you do not receive e-mail in your 'inbox', check your 'bulk mail' or 'junk mail' folders.

Copyright © Macrothink Institute ISSN 2162-3082

'Macrothink Institute' is a trademark of Macrothink Institute, Inc.