Finance

This research examines the critical influence of cash management on the financial efficacy of the conventional banking sector in Pakistan. This study represents the initial attempt to assess the influence of liquidity, debt ratio, and bank size on return on assets among five conventional banks in Pakistan. Information was obtained from audited annual reports from publicly traded banks that span from 2017 to 2021. The results indicate a significant positive correlation between liquidity and return on assets (ROA). Additionally, a significant negative association between debt ratio and ROA is examined. Furthermore, the study reveals that the size of banks exhibits a significant negative relationship with ROA. The study will provide valuable insights for financial managers, portfolio analysts, treasurers, and controllers on the practical implementation of contemporary cash management strategies.

High banking penetration is considered an important indicator of the stability and maturity of a country's financial system, which can attract foreign direct investment (FDI). This phenomenon is becoming increasingly relevant in the ASEAN region, which continues to seek to increase its attractiveness for foreign investors amid global challenges. The study used secondary data from the International Monetary Fund covering the period from 2010 to 2021. The analysis was carried out using the regression of panel data of the Random Effect Model type. The results show that banking penetration has a significant positive impact on FDI in ASEAN. This confirms that foreign investors' confidence in the domestic financial system is very important. In Indonesia, strong banking penetration supports FDI growth despite regulatory and infrastructure challenges. In Malaysia, expanding access to digital financial services is important, while in Thailand, cooperation between the banking and telecommunications sectors is an example for other ASEAN countries. ASEAN countries need to focus on increasing banking penetration through policies that support digital financial services, improve corporate governance, and strengthen regional cooperation. The originality of this research lies in an in-depth comparative analysis of the impact of banking penetration in Indonesia, Malaysia, and Thailand, providing insights and policy strategies that can be adopted by other ASEAN countries to increase their FDI attractiveness.

The aim of this research is to investigate the impact of financial behavior and experience on the financial literacy of university students. The study employs a primary approach to data collection utilizing questionnaires. The targeted population consists of students from various universities in Pakistan, with a sample size of 250 students chosen through random sampling. Regression analysis reveals a positive and statistically significant relationship between financial behavior, financial experience, and financial literacy (p > 0.05). The conclusion drawn from the analysis suggests that enhancing financial behavior and providing practical financial experience can positively influence the financial literacy of university students. These findings have implications for educational institutions and policymakers, highlighting the importance of integrating financial education into university curricula to equip students with essential financial skills for navigating the complexities of modern financial systems.

This study aims to assess the impact of pay disparity on the sustainable growth of listed firms in Korea, and to explore how this relationship is influenced by the presence of managerial overconfidence. Employing a fixed-effects regression model, the analysis draws on 10,244 firm-year observations from Korean-listed firms between 2012 and 2022. The findings reveal a significant positive association between pay disparity and the sustainable growth of firms, supporting the tournament theory, Moreover, this effect is more pronounced in companies led by overconfident management. The robustness tests also confirm the main regression results. This study highlights how pay disparity together with the presence of managerial overconfidence can drive sustainable growth. It recommends tailored compensation strategies that consider management dynamics and organizational context, helping firms navigate compensation challenges and enhance long-term success and competitive advantage. The study provides valuable insights for policymakers, investors, and other stakeholders in crafting equitable compensation practices that promote resilient and sustainable business environments. This study’s originality lies in its consideration of managerial overconfidence, setting it apart from prior research that primarily examines the direct link between pay disparity and sustainable growth.

This study aims to investigate the root causes of burgeoning external debt in Pakistan and to identify potential ways to minimise the growing burden of external debt. By analyzing time series data from 1976 to 2022, using the Auto Regressive Distributive Lag Model (ARDL) bound test and local projection impulse response, the research finds a long-term relationship among remittances, external debt, and other variables. The results indicate that gross domestic product (GDP) growth rate, trade volume, and foreign exchange reserves play crucial roles in mitigating Pakistan’s external debt, offering avenues for reducing the country’s debt burden, as the probability values of their coefficients are less than 0.05. However, remittances, gross capital formation, and external debt servicing contribute to increasing external debt at a 5% significance level. The negative and significant error correction term (ECT) implies the system’s stability and convergence. The study concludes that while remittances and gross capital formation have contributed to the increasing external debt, effective management of GDP growth, trade volume, and foreign exchange reserves can mitigate this burden. Based on these findings, it is recommended that the Government of Pakistan prioritize enhancing the GDP growth rate by channelling remittances and other foreign currency inflows, such as Foreign Direct Investment (FDI), foreign grants, and export earnings, towards building up foreign reserves.