Determinants of Financial Performance in Banking Securitization in Southeast Asianv

Abstract

The purpose of   this paper is to examine the effect of   financial   performance   in   banking securitization      in      Southeast      Asian.      In      particular,      the      authors      examine two important issues. First,     the     ABS (Asset-Backed Securities) effect     on     Return     on Assets (ROA) as indicators of   firm   profitability. Second,   bank   securitization   improved profitability      by      securitizing      its      portfolio      loans      to      investors      to      get liquidity. The authors used a sample of    12    commercial    banks    in    Southeast    Asian Countries (including Indonesia, Singapore, Thailand, Malaysia, and the Philippines). A data panel regression model was used from 1998 to 2018. The results show that ABS has found a significant positive on ROA as an indicator of firm profitability. On the other hand, ABS has a negative  relationship  with  the size as  a  moderating  variable  on  ROA.  Furthermore, banks can liquidate loans to finance the liquidity they need      without      dependence      on traditional        sources        of funds (deposits, savings, and        current        accounts).        In addition, securitization improved financial               ratios such               as ROA,               Size, and reduces banks securitization’s            default            risk