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  Publications | Banker's Journal Malaysia |  Paper Synopsis | Issue 120

 

2002
(Issue No. 120)

 

 

Synopsis

Developing and Running Credit Card Programmes - Some Key Planning Issues
by David Cavell
Using Credit Scoring for New Business Decisions: Some Key Concepts and Ideas
by Helen McNab
The Case for Affinity Card Programmes
by Prof Steve Worthington

Such is the increasing interest in the development of these card products - with their powerful combination of credit line, international payments capability, and first class control and money transmission systems ?that few major markets do not have their own rapidly growing programmes. And Malaysia is no exception.

In this series of three papers, the authors deal with a number of the many issues involved in planning a way into the business, and running it successfully. What is the rationale for affinity marketing? On what basis should an organisation choose between Mastercard and Visa? What is the role of scoring?

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Z-Score Revisited: Its Applicability in Predicting Bankruptcy in the Malaysian Environment
by Dr Fauzias Mat Noor and Chin Yok Fong

There are numerous literature, dating back to 1967, on predicting corporate bankruptcy using different predicting models. In this paper, the authors studied the applicability of the Z-score model, first introduced by Edward I. Altman in 1968 to study the US environment, to predict the probability of bankruptcy by using published financial data of Malaysian companies. These companies ?manufacturing in nature ?are mainly listed under the industrial sector as well as a few companies listed under the consumer sector that are also clearly manufacturing in nature. This study is timely especially in the wake of the 1997-1998 Asian financial crisis which has thrown a fair number of seemingly ‘strong?corporations into financial problems. The issue here is to examine whether the Z-score using the multiple discriminant analysis can be used in Malaysia to predict bankruptcy or insolvency.

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The Empirical Investigation of Firm Size Effect on Overreaction Hypothesis
by Lai Ming Ming

This paper examines the short-horizon overreaction with and without control for firm size on the monthly returns of all stocks in the Kuala Lumpur Stock Exchange from January 1987 to December 1999. The short-horizon overreaction indicates return reversal patterns significantly for the winner, loser, and arbitrage portfolios. Overall, the findings are in favour of the investor overreaction hypothesis as the overreaction behaviour does not disappear with the controlling of firm size. The findings suggest that small firm size and overreaction anomalies are persuasive.

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