Abstract. Property damage from flooding creates urgent funding needs that uninsured households often struggle to meet, particularly when access to affordable credit is limited. While prior research links floods to higher rates of financial distress, little is known about the prevalence and drivers of credit constraints among flood-exposed property owners. In this study, we use a simulation-based approach to estimate the impact of uninsured damage on residential mortgage borrowers' financial conditions over a series of floods in North Carolina from 1996–2019. Our framework estimates key variables (e.g., damage cost, property value, mortgage balance) to project the number of flood-exposed borrowers experiencing credit constraints due to negative equity, liquidity issues, or both in combination. Conservative projections suggest that the seven floods evaluated generated USD 4.0 billion in property damage across the study area, of which 66 % was uninsured. Among flood-affected mortgage borrowers, only 48 % had insurance, and 32 % lacked sufficient income or collateral to finance repairs through home equity-based borrowing, making their recovery uncertain. By identifying which borrowers are likely to have unmet funding needs due to flood-related credit constraints, these results can inform the design of interventions to improve the financial resilience of flood-prone households.

All economic decisions, both at the macroeconomic and microeconomic levels, involve the assessment of various forms of business performance. Numerous indicators can be used to provide information about the interests of shareholders in evaluating investments and their relationships with the business. Understanding the relationship between business performance and equity is crucial, as negative equity can be considered a critical asset parameter. This assessment study aims to determine the relationship between negative equity and business performance in Türkiye by evaluating comprehensive financial data from companies with negative equity between 2020 and 2024. Furthermore, this assessment study uses the Altman Z-score and the IN05 index to assess the performance of companies with negative equity by dividing companies operating in the manufacturing sector into bankruptcy, prosperity, and gray zones.

Abstract Why do homeowners default on mortgages? This paper studies the question using a survey specifically designed for the purpose, with a sample drawn from (and matched to) rich administrative data. I find that a wide variety of typically unobserved liquidity shocks together trigger nearly all defaults, so “strategic” default with no liquidity trigger is much less common than it usually appears. Conversely, even in this uniquely rich data, I find that many foreclosures are not triggered by negative home equity, contrary to the predictions of almost every model in the literature.

The supplementary health sector in Brazil plays an essential role, offering access to private health services for more than a quarter of the population. However, a continuous decrease in the number of Health Insurance Providers (HIPs) indicates a market concentration process, posing socioeconomic risks. To address the impacts of these closures, this study develops a predictive model to identify the key factors leading to corporate failure. A major limitation of existing research is its reliance on ambiguous insolvency proxies, such as negative net equity. This study fills a critical gap by adopting a more robust definition of failure: the compulsory termination of a provider's activities by the national regulatory agency (ANS). Applying logistic regression to a sample of 677 providers from 2014 to 2020, the model identified the EBITDA margin, net equity on total assets, working capital on total revenues, and financial assets on current liability as significant predictors. Notably, the model revealed that high volumes of short-term receivables relative to current liabilities are positively correlated with the probability of failure, suggesting this metric can mask underlying financial distress. Among categorical variables, being a self-insurer or a health cooperative was found to reduce the chances of failure. The model demonstrated high discriminative capacity (92%) and achieved 77.8% accuracy in forecasting failures in the sample test. The findings provide a crucial early warning tool for regulators, HIP managers, and stakeholders to enhance financial risk management and prevent service disruptions in the supplementary health sector.

Purpose: This research paper focus has investigated the effect of certain market-based predictors on the audit opinion of equity firms. The study attempted to establish the nature of significant financial indicators on the audit risk of firms to obtain unqualified or going-concern-related audit opinions. Design/Methodology/Approach: A correlational research design was used as a population of 33 listed firms that reported negative book equity within the study period was used. An adjusted sample of 19 complete data-filled firms was obtained with the help of a census sampling method that employed a filtration strategy. Findings: The outcome showed that the probability of getting a going-concern modification, as compared to an unqualified audit opinion, depends greatly on the Earnings Per Share. The firms, which have higher earnings performance, have lower chances to have a going-concern-related. The effect of Book Value Per Share on the probability of either receiving non going-concern or going-concern modification was positive but not significant. Implications/Originality/Value: The paper emphasizes the need to enhance financial performance, especially Earnings Per Share and Book Value Per Share to reduce the risk of going-concern modifications. It suggests that management of book equity firms should take proactive steps to tackle the issues that impact on BVPS including high leverage or decreasing profitability.

Purpose: This study examines the impact of audit attributes and book value per share on audit opinion among listed negative book equity firms in Nigeria over a sixteen-year period (2007–2022). It evaluates audit opinion from a multidimensional perspective comprising unqualified audit opinion, non-going-concern–related qualification, and going-concern–related modification. Design/Methodology/Approach: A correlational research design was employed using a population of 33 listed firms. A filtration approach yielded a sample of 19 firms with complete data. Secondary data were extracted from the annual reports and accounts of the sampled firms. Panel Multinomial Logistic Regression was used as the technique of analysis. Findings: The study finds that audit switch has an insignificant effect on the likelihood of receiving both non-going-concern and going-concern–related modifications relative to unqualified audit opinion. Audit committee expertise significantly increases the likelihood of firms receiving both types of modified opinions. The results also show mixed evidence regarding the effects of audit size and book value per share on audit opinion outcomes. Implications/Originality/Value: The study underscores the critical role of audit committee financial expertise in shaping audit opinion outcomes, particularly for firms that report negative book values. It adds to the literature by providing multidimensional evidence on audit opinion determinants within distressed firm contexts in an emerging market setting. Based on the findings, it recommends that management of listed Nigerian firms prioritize strengthening the financial expertise of their audit committees.

This study examines how internal governance mechanisms shape corporate debt structure in a capital intensive and crisis exposed industry. It analyses 61 basic materials firms listed on the Indonesia Stock Exchange over 2019–2023 (305 firm year observations), a period covering pre pandemic conditions, the COVID 19 shock, post crisis recovery, and global monetary tightening. Debt structure is proxied by the debt to equity ratio (DER), which exhibits extreme volatility with values ranging from −23,124.66 to 4,950.11, indicating widespread negative equity and severe financial distress in part of the sample. The empirical model is a fixed effects panel regression with cluster robust standard errors. Board size, institutional ownership, and firm age show positive and statistically significant effects on leverage, while the proportion of independent commissioners has a strong negative effect; audit committee size and return on assets (ROA) are not significant. Firm value, measured by price to book value (PBV), has a large negative impact on DER and significantly moderates the effects of board size and independent commissioners on leverage. A PBV threshold at approximately 0.945 separates regimes where independent commissioners reduce leverage (distressed/undervalued firms) and where they facilitate higher leverage (fairly valued or overvalued firms). The findings validate a conditional multi theory framework that combines agency theory, resource dependence theory, and pecking order logic instead of relying on any single theory. They highlight that governance mechanisms are neither uniformly “good” nor “bad” for leverage but context dependent, with firm valuation and crisis conditions critically shaping their effects. The results provide implications for boards, regulators, creditors, and investors in emerging markets when designing governance structures and monitoring extreme leverage in capital intensive sectors.

This research evaluates the financial performance and potential long-term value of BYD and Zeekr within the context of China's rapidly developing electric vehicle sector. Integrating value-investing ideology and the DuPont Analysis System shows how the research combines the components of profitability, operational efficiency, and financial leverage. Assessing these factors makes it possible to understand which of the two firms possess the greater capacity to generate value. Financial reports made publicly available were the primary data source, which were subsequently analyzed using the DuPont model. As the findings pointed out, BYD demonstrates a stronger and more consistent profitability which mirrors sustainable and competitive advantages and a more mature market position. Whereas BYD shows relatively high and stable profitability, Zeekr has high asset turnover which conveys operational efficiency and increase potential, albeit consistent negative profitability. The equity multiplier demonstrates the financial leverage within Zeekr which, combined with negative equity, greater Zeekr financial uncertainty and risk. Overall, the results suggest that BYD is aligned with the traditional value-investing model owing to the stability of financial fundamentals. In contrast, Zeekr is poised for high-growth speculative investments. Overall, these findings suggest highly that the DuPont system can evaluate corporate performance and can assist an investor in determining long-term value in different stages of market maturation.

The article examines the current financial and economic situation of tourism businesses in the context of martial law and rapid changes in the market environment. It analyses the dynamics of key indicators of financial and economic performance, in particular changes in net income, profit, cost structure, profitability, liquidity and asset structure of the company used as an example in the study. It highlights the growth in operating losses, negative equity, a sharp decrease in current assets, and excessive dependence on short-term borrowing by domestic tourism businesses. Particular attention is paid to identifying internal and external factors that negatively affect the financial stability of the enterprise. Among the main challenges are a decline in demand for tourism services due to martial law, an increase in administrative expenses, an insufficient level of gross profit, physical wear and tear of fixed assets, and a high proportion of accounts receivable. The paper substantiates the need to rethink approaches to cost, asset and financing management. A set of anti-crisis measures is proposed, including optimisation of personnel and office expenses, introduction of energy-saving technologies, revision of marketing strategy and terms of cooperation with partners. Separate emphasis is placed on the advisability of attracting external financing to restore equity capital, solvency and create a reserve fund. It was concluded that in crisis conditions, improving efficiency is only possible through comprehensive restructuring of costs, expanding the customer base, strengthening financial autonomy and active participation of the enterprise in promoting Ukraine as a promising tourist destination..

ABSTRACT The redesign of educational quasi-market instruments has been gaining traction in response to the negative equity impacts of these policies, with various educational systems introducing adjustments in the design of school-choice schemes and subsidies for private schools. However, the capacity of such policy calibrations to address inequalities remains open to question. This paper develops an analytical framework to understand the effects of redesign initiatives and inform policy action. Drawing on a mechanism-based approach to policy design, we propose and apply a theoretically-driven framework situating the causality between policy problems, instrument design and outcomes at the centre of the analysis. Examining the recent wave of redesign reforms, the paper demonstrates that the equity-enhancing potential of calibrations can be assessed based on their capacity to disrupt the mechanisms connecting quasi-market instruments with educational inequalities. It also finds that some mechanisms prove particularly challenging to affect, inviting reflection on the limits of redesign.

Objective: This study investigates the effect of intangible assets on the financial performance of companies in Georgia. The focus is on how intangible resources, measured by the Representativeness of Intangible Assets (RIA), influence Return on Assets (ROA) as a key performance indicator. Methodology: The research utilizes a panel regression analysis with a fixed-effects model to examine the relationship between intangible assets and company performance. The dataset comprises financial reports from 845 Georgian companies, spanning the period from 2019 to 2022, obtained from the Service for Accounting, Reporting, and Auditing Supervision of Georgia. The study excludes companies from the financial industry and those with negative equity. Results: The findings indicate that intangible assets have a significant and positive impact on firm performance. The study reveals that companies with a higher proportion of intangible assets outperform their peers, supporting the hypothesis that investment in intangible resources leads to improved profitability. Company-specific factors also play a substantial role in determining firm performance. Conclusions: This study provides empirical evidence that intangible assets are key drivers of profitability in Georgian companies. It highlights the importance of intangible resources in achieving competitive advantages, particularly in emerging markets transitioning towards knowledge-based economies. Limitations include incomplete disclosure of intangible assets in company financial statements, which may affect the analysis' comprehensiveness. Implications: The study offers insights for corporate strategy and policy, emphasizing the need for companies to invest in intangible assets and for policymakers to foster an environment conducive to the development of these resources.

This research investigated the impact of capital structure on the financial performance of selected financial services firms listed on the Lusaka Securities Exchange (LuSE) between 2019 and 2023. The analysis focused on five (5) companies: Standard Chartered Bank Plc (SCB), Zambia National Commercial Bank Plc (Zanaco), Madison Financial Services Plc (MFS), Zambia Reinsurance Plc (ZR) and Real Estate Investment Zambia Plc (REIZ). The Objective was to examine how Debt to Equity (D/E) as a Capital structure Variable influences Net Profit Margin (NPM) a performance indicator of firms within Zambia's financial sector. The study relied solely on quantitative financial data derived from audited financial statements and official LuSE disclosures. The key capital structure metric measured was the D/E, identified as the independent variable, and the performance indicator metric measured was NPM, identified as the dependent variable. Results reviewed that the banking institutions SCB & Zanaco maintained high average D/E ratios (1336% and 1203%, respectively) yet continued to post strong profit margins, reflecting efficient use of financial leverage. By contrast, MFS recorded negative equity and extreme D/E ratios exceeding -2000%, signaling deep financial instability. ZR adopted a conservative approach with a 29% D/E ratio, while REIZ saw fluctuating leverage, peaking at 79% in 2021 before stabilizing at 39% by 2023. The findings suggest that effective debt management supports sustained profitability in banking firms, while excessive leverage can endanger the financial viability of non-banking institutions. The research emphasizes the importance of maintaining optimal capital structures tailored to each firm's risk profile. Recommendations include adopting balanced financing strategies, reinforcing debt control mechanisms, and enhancing regulatory capital structure adequacy standards, particularly for non-banking financial entities. These insights aim to inform managerial decisions and regulatory frameworks in Zambia's financial landscape.

This paper aims to identify the fundamental institutional reforms necessary for Korea’s residential tenant protection law and transactions. Main objectives for reforming Korea’s residential lease legislation are summarized as: ① stabilization of lease and ② assurance of the return of lease deposits. With respect to the assurance of lease deposit returns, recent issues such as Jeonse fraud and ‘negative equity’ housing underscore the urgent need for legislative supplementation. This article examines the most pressing problems and possible solutions for effectively securing the return of lease deposits. In particular, the paper addresses: ① so-called “next day” provision, ② improving the legal framework for guarantee insurance and the obligation to provide credit information, and ③ the dispute resolution system to allow for expedited resolution and enforceable execution in lease disputes. The rationalization of residential lease transactions cannot be achieved by amending the Residential Lease Protection Act. In this context, the article proposes: ① the duty of care owed by licensed real estate agents and the activation of exclusive agency and multiple listing service (MLS) systems; and ② the mandatory use of written offers in lease contracts and the obligation to return the deposit in advance upon lease termination. This article presents draft amendments to the Residential Lease Protection Act and the Licensed Real Estate Agents Act.

The four major football clubs have consistently incurred losses each year because their revenues insufficiently cover their expenses. As these losses have accumulated over time, equity has steadily declined. The abnormal increase in accumulated losses has led to a negative equity position. Instead of financing their assets with equity, the clubs have had to rely on debt to finance not only their assets but also their negative equity. The deterioration of the financial structure of the four major football clubs has resulted in increased borrowing, leading to higher principal and interest payments. Total debt has increased as interest payments have increased. For football clubs to pay high amounts of debt, the structure of their debts must be examined. It seems that debt management is important to ensure the financial sustainability of clubs. This study examines the debts and financial structures of the four major football clubs in Türkiye’s Süper Lig. Using financial statement data from the past 10 years, the study evaluates their total assets, total debts, total equity, and net profit/loss for the period. The financial condition of the clubs was assessed using financial structure ratios. The findings indicate that the clubs have lost their equity, are financing both their assets and equity with external funds, and lack sufficient liquid assets to meet their debt obligations. Excessive debt negatively impacts the sustainability of football clubs. Football clubs must manage their debts through effective financial planning to achieve sustainable financial stability.

Abstract Manuscript type: Research paper Research aims: When the financial statements of football clubs listed in BIST are examined, it is seen that they are in financial distress. The clubs continue their activities with negative equity. Their debts are five to six times more than their assets and their continuity is uncertain. The striking financial problems of football clubs have been the motivation of the study. In this regard, the aim of this study is to determine the effect of financial ratios on the stock prices of football clubs traded in Borsa Istanbul (BİST). Design/Methodology/Approach: The stock prices and financial ratios of the listed football clubs, of Türkiye, for quarterly 2005-2021 periods were analysed using random effect analysis with the SAS 9.4 program. Data were obtained from “Stockeys” provided by Finnet Elektronik Publishing Ltd, and “isyatirim” website. Research findings: As a result, the current ratio (CR) and debt to asset (DA) ratio were found to have positive effects on stock prices. Theoretical contribution/Originality: The originality of this study is that it reveals the impact of financial analysis of football clubs, where sports performance is a priority for investors. The study also provides a critical perspective on the effects of financial ratios due to the remarkable financial structure of football clubs. Another contribution of the study is that it provides important information to both researchers and investors, due to the extensive literature review. Future researchers can further expand this research by using different financial ratios and considering different ownership structures of clubs and socioeconomic structures of board members. Practitioner/Policy implication: The findings offer valuable insights for investors, particularly those interested in the sports sector. The identification of financial ratios that positively impact stock prices can guide investment decisions.

According to global market outlooks, the aviation industry is expected to demand 43,975 new aircraft between 2024 until 2043, which will significantly increase the need for Maintenance, Repair, and Overhaul (MRO) services. As the leading MRO provider in Indonesia, Aeroantara Technic is well positioned to capture this growth. However, it faces internal challenges due to its prolonged negative equity position. This study assesses the investment feasibility of an investor to develop a new wide body aircraft hangar with two to four additional slots that would be operated by Aeroantara Technic under an Operation Management (OM) scheme. The analysis is approached from two perspectives. First, whether the project is financially viable for the investor since without a feasible investment return, Aeroantara Technic would not be able to lease the hangar. Second, if the project is indeed feasible, the study estimates the potential benefit that Aeroantara Technic could gain from operating the hangar under this arrangement. The analysis integrates financial data projections using discounted cash flow modelling, supported by publicly available data inputs from industry and internal insights utilized to build credible assumptions and enhance the realism of projections. The results indicate a robust return on investment with a positive NPV of USD 19.2 million, an IRR of 14.2%, and payback period 10.6 years, confirming adequate profitability and feasibility. To further account of uncertainties, a sensitivity analysis using Monte Carlo simulation is conducted, strengthening the confidence in the project decision under varying risk scenarios. Align with international aviation sustainability goals (ICAO’s CORSIA and IATA’s Fly Net Zero), Aeroantara Technic could incorporating ESG aspects that may unlock green financing, government incentive, and customer preference for sustainable MROs. In conclusion, expanding Aeroantara Technic’s capacity for aircraft maintenance through a new hangar represents a financially sound strategic move aligned with the industry growth forecasts.

Abstract The US Federal Reserve has been incurring income statement losses since September 2022 and now operates in a state of negative net equity. The Fed has taken the position that the losses do not matter to monetary policy making and normal functioning. This paper sets out the reasons for the mounting losses and the Fed positioning in response, covering fundamental issues at stake, including interest paid on reserves to financial institutions, remittances and deferred assets. The analysis demonstrates that the scale and duration of the losses and the creditor relation with Treasury that has resulted pose a major challenge to Fed credibility and independence and raise questions regarding the financial and political sustainability of the Fed stance. Further, the paper presents evidence that the Fed has not been transparent with Congress or the public about the risks and costs of the QE and IOR/ONRRP regime. It suggests this non-transparency might be explained by a fear of loss of credibility that has extended and exacerbated the loss making. Finally, the analysis reveals a fiscal and political cost of Quantitative Easing (QE) that questions its possible use as policy response in future crises.

Local bureaucracies leave the delivery of market-like services to the corporations they set up. We analyse the financial situation of 22 municipally owned corporations (MOCs) in full ownership of eight main regional cities in the Slovak Republic. MOCs are divided in the article into four groups according to their activities: Urban transport, Waste collection, Real estate management and Engineering activities. We calculate and compare the financial indicators of MOCs with the median values of the indicators of the relevant sectors for each of the four analysed groups of corporations. We establish research questions and hypotheses in which we find out whether the achieved values of the indicators do not differ significantly from the median values of the sectors. We evaluated the differences using the Wilcoxon signed-rank test for two dependent samples. We also assessed whether MOCs do not predominantly achieve negative equity. Also, whether they are not at risk of bankruptcy and whether they pay dividends.

Abstract We examine the effects that household exposure to housing price declines, captured by measures of negative equity, have on children's academic performance, using data on public school students and housing transactions from the State of Florida. Our empirical strategy exploits variation over time in the timing of family moves to account for household sorting into neighborhoods and schools and selection into initial mortgage terms. In contrast to the existing literature on the effects of foreclosure, we find that students with the highest risk of negative equity exhibit significantly higher test score growth, with the largest effects among Black students and students qualifying for free or reduced-priced lunch. We find evidence supporting two underlying mechanisms: (1) families in negative equity may reduce the impact of income losses on consumption by forgoing mortgage payments, and (2) families exposed to high levels of negative equity may move to schools that received higher average school report card grades. While negative equity and foreclosure are undesirable, negative equity may have encouraged homeowners to forgo mortgage payments to mitigate the impact of the Great Recession, and temporarily reduced the housing market barriers low-income households faced in accessing educational opportunities.

The maritime sector and its associated businesses, like shipping lines, serve as the connecting framework for global economic expansion and are crucial to the advancement of human society at large. This essay seeks to give a general overview of how Indonesia's maritime industry and shipping line companies are affected by the unpredictability of the world situation. We examine secondary data from the following annual financial reports from publicly traded businesses active in shipping and logistics over the five year from 2017 to 2021. From the data, we know that from a total a 165 company publicly listed companies in Indonesia engaged in logistics, 94 of them have a sea freight business, with 84 companies are 3PL businesses, 5 others are shipping agencies and 4 companies are known to have shipping line services such as tankers, containers, LNG, and dry bulk (SMDR, SMIN, TMAS, BLTA) (SMDR, SMIN, TMAS, BLTA). From the nine observed companies with their ships, the majority of observed companies in 2019 had gradually decreased equity during Covid-19, and even in early 2021, one company was not only losing equity but also had negative equity of Rp. -110 billion, forcing it to cease operations (go bankrupt) or obtain new funding to survive. However, it's interesting to note that one organization demonstrated that it was able to perform better than it had before the pandemic, demonstrating that each business or organization has a different degree of resilience based on its strategy.