The EFFECT OF CAPITAL RESTRICTIONS ON THE MARKET VALUE OF THE STOCKS OF A SAMPLE OF IRAQI BANKS

Abstract

The research aims to study the impact of the change in the market value resulting from the increase in the capital of a sample of banks listed in the Iraq Stock Exchange. Which imposed a capital increase by the Central Bank of Iraq to increase the capital efficiency of those banks. The research attempts to shed light on the concepts associated with the research variables. Theoretically, by reviewing the concepts and topics related to capital increase and the market value of stocks. Applied by measuring the correlation and regression with statistical significance between the two research variables, which contributes to verify the research hypotheses. Data were collected from the Iraq Stock Exchange and the Iraq Securities Commission. The research community is represented by the listed bank sector, whose stocks were traded on the Iraq Stock Exchange, and they amounted to (41) banks. The research sample identified (7) listed banks that did not record any missing data during the research period, with a number of (48) observations from the beginning of 2007 to the end of 2018 quarterly, with four observations per year. SPSS program was used in statistical analysis and Microsoft Excel program to collect data, format it and represent it in graphical forms. The most important results of the research concluded on the effect of the increase in capital on the market value of the stocks of the research sample in a positive direction. However, this does not agree with the research hypothesis that the increase in capital leads to a decrease in the market value. The most important recommendations concluded that it is necessary to use more effective measures and models for financial research because of the inaccuracy of the traditional results in measuring the large fluctuations that occur in the financial data.