Abstract
This research aims to investigate the relationship between ownership structure and dividend policy of Vietnamese listed companies. The empirical findings show that the government-controlled companies, the companies with high concentrated ownership and with recent right issue activities would have higher dividend payments. In addition, due to the change of Vietnamese dividend tax rate to encourage the market development after global economic crisis, we discover that when the personal income tax rate at higher level of 5%, the sate-owned firms in Ho Chi Minh Stock Exchange would still pay higher dividends, which represents the dividend preferences of the investors, the status of firms’ stable development and the effectiveness of national economic policies.
Highlights
Dividend-payout policy is always considered as one of the most important decisions in financial management of company
This research contributes to the limited study on the link between the ownerships, the government role, the capital raising activities, the future growth and dividend payout policy of the listed companies within the context of a single country, Vietnam
The majority shareholders seem to have incentive to distribute high dividends because of their disproportionate high investment return, which is risky to the minority shareholders due to their low influence on management policy decision and lack of legal protection
Summary
Dividend-payout policy is always considered as one of the most important decisions in financial management of company. The dividend payment may affect directly the interests of shareholders and the future development of a company. In a new security market as Vietnam, due to the information asymmetry, investors often rely on the dividend payment as a viewpoint to predict the company’s future prospects. The security market has worked well to push up the Vietnamese economic and maintain a high development speed. Until 2014, share market capitalization reaches close to 40% GDP of Vietnam, becoming the major channel for capital mobilization of both State-owned and private economic sector
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