Universal Journal of Accounting and Finance Vol. 12(1), pp. 1 - 12
DOI: 10.13189/ujaf.2024.120101
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Regulatory Constraints on Financial Performance of Insurance Firms in Egypt: Structural Equation Model


Salah Mohamed Eladly *
Department of Business Administration, Higher Institute of Advanced Studies, Egypt

ABSTRACT

The structural equation model is used to examine the relationship between regulatory constraints measured by investment to paid capital, cash to paid capital, government securities and certificate, and firm size (algorithm of total assets) on financial performance measured by liquidity, Return on equity and Return on assets of insurance industry in Egypt. The results showed that the relationship between regulatory constraints and return on equity is such that there is a significant negative effect of the construct the independent variables in terms of investment, cash, and government securities and secure certificates (X3), on the dependent proxy, return on equity. However, the later independent proxy of the algorithm of total assets (lnx4) has a positive impact on the dependent proxy in terms of return on equity and a significant negative impact of the independent proxies' investment, and cash on the dependent variables return on assets. However, the later independent variable of the algorithm of total assets (lnx4) has a positive effect on the dependent variable of return on assets. This validates the second research hypothesis, as the independent variables investment, cash, and algorithm of total assets (lnx4) have a significant effect on the dependent variable return on assets. Beside that there is a significant negative effect of the independent variables investment X1, and cash X2 on the dependent variable liquidity. However, the later independent variable of (lnx4) has a positive effect on the dependent variable liquidity. This validates the third research hypothesis, as the independent variables investment, cash, and algorithm of total assets have a significant effect on the dependent variable liquidity, but an insignificant relationship with government securities.

KEYWORDS
Regulatory Constraints Operating Objective (Profitability), Operating Policy (Liquidity)

Cite This Paper in IEEE or APA Citation Styles
(a). IEEE Format:
[1] Salah Mohamed Eladly , "Regulatory Constraints on Financial Performance of Insurance Firms in Egypt: Structural Equation Model," Universal Journal of Accounting and Finance, Vol. 12, No. 1, pp. 1 - 12, 2024. DOI: 10.13189/ujaf.2024.120101.

(b). APA Format:
Salah Mohamed Eladly (2024). Regulatory Constraints on Financial Performance of Insurance Firms in Egypt: Structural Equation Model. Universal Journal of Accounting and Finance, 12(1), 1 - 12. DOI: 10.13189/ujaf.2024.120101.