Abstract
Debt maturity structure plays an important role in enterprises’ capital structure policies, and debt maturity varies from industry to industry. The paper investigates the determinants that affect the debt maturity structure of listed firms in the consumer goods industry from 2009 to 2019. The data is collected from consumer goods companies listed on the Vietnam Stock Exchange. The feasible generalized least squares (FGLS) estimation is demonstrated to consider not only micro but also macroeconomic variables that have influenced the corporate debt maturity policy. The empirical results show that five microeconomic factors, such as capital structure, asset structure, asset liquidity, profitability, and firm size, have influenced the debt maturity and are statistically significant. Meanwhile, macroeconomic factors such as inflation rate and credit growth have significantly affected the corporate debt maturity. Finally, the paper provides some suggestions for financial managers on the optimal corporate debt maturity in the consumer goods sector and recommendations for policy-makers when implementing macroeconomic policies.
Highlights
Capital structure has been studied both in previous literature and in empirical research in terms of optimal capital structure or target capital structure
This paper examined the determinants affecting the debt maturity structure of 78 listed consumer goods firms in Vietnam from 2009 to 2019
The determinants of corporate debt maturity are estimated based on the influence of both microeconomic and macroeconomic factors
Summary
Capital structure has been studied both in previous literature and in empirical research in terms of optimal capital structure or target capital structure. Modigliani and Miller debt because of the limitation of business scale and (1963) noticed the capital structure in a perfect collaterals This statement is supported by a study world that the capital market is incomplete; there- of Ozkan (2000) using data from 421 non-financial fore the corporate financing still may not be ex- UK firms during 1983–1996 to determine the inplained as limited. The matching principle was mentioned in a study by Alcock et al (2012) that a company has a higher The aim of this paper is to investigate the determipercentage of tangible assets that are willing to fi- nants of corporate debt maturity based on the exnance with long-term debts instead of short-term isting theories with the sample obtained from the ones to reduce the distress cost. H4: An increase in the rate of return has a posi- ty structure of consumer goods firms in Vietnam, tive effect on corporate debt maturity. H7d: Credit growth has a positive impact on cor- puted by the logarithm of total assets of a compaporate debt maturity
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