Cost efficiency and profitability in Thailand's life insurance industry: A stochastic cost frontier approach

Liberalized environments brought about by trade agreements and other restructuring of international markets under the General Agreement on Trade and Services (GATS) have increased market opportunities for foreign firms. This opening up of domestic market under GATS will cause the inflow of foreign insurance firm hence heighten competitive pressures. As such, insurance firm in Thailand need to be efficient to ensure their survival. Hence, the purpose of this paper is to evaluate the cost efficiency and its relationship with profitability in Thailand’s life insurance firms during the period 1997-2002 using the stochastic cost frontier approach. We find that the industry is on average 82 to 140 percent inefficient. There is no significant relationship between inefficiency and age. But, the mean inefficiency is negatively correlated with size suggesting the need for rationalization in the insurance industry in Thailand. Consolidating the large number of smaller insurers should be high on the government’s agenda, and the capital requirements for life insurers need to be increase. We show that inefficiency is negatively correlated with ROE and ROA ratios. This shows that efficient firms, on average, have higher return on equity and on assets. This indicates that inefficiency has substantial effect on the profitability of life insurance companies

Institutions and foreign direct investment (FDI) in Malaysia: empirical evidence using ARDL model

Since 1990’s, institution factors have been regarded as playing important roles in stimulating foreign direct investments (FDI). However, empirical studies on their importance in affecting FDI are still lacking especially for small open economies. This paper attempts to investigate the role of institutions upon the inflow of foreign direct investment (FDI) in a small open economy of Malaysia. Using bounds testing approach (ARDL model), the empirical findings reveal that there exists a long run relationship among FDI and the institution variables. Specifically, several institution variables namely government stability, bureaucracy, and corruption are found to play prominent roles in influencing the inflow of FDI. Thus, in attracting foreign investors, implementing FDI-friendly policies by providing and maintaining the quality of domestic institutions would be beneficial to Malaysian economic growth.Institutions; Foreign Direct Investment (FDI); ARDL

Information technology and cost efficiency in Malaysian banking industry

It is argued that information technology can increase cost efficiency of banks by offering opportunities to substitute across inputs into production – for example, to substitute computer technology and information networks for labor. Hence, the transition to a knowledge-based financial sector would lead to banks becoming more competitive, more cost effective and better able in managing risks. As such, those banks that failed to make this transition are less able to compete as they lack the capability to innovate and face higher delivery costs. The main objectives of this paper are to determine the impact of IT on banking efficiency and its economies of scale using a sample of Malaysian banks. To achieve these objectives, stochastic cost frontier method is employed to estimate bank efficiency and panel data approach were used to examine the impact of IT on bank efficiency. The results indicate that the impact of IT on bank efficiency increases with increase in bank size, hence further supporting the process of bank mergers that are currently undertaken in the Malaysian banking industry

The Effect of Thermal Aging to The Impact Properties of Glasss Fiber Reinforced Epoxy

Fiber reinforced composite materials are widely used in automotive industries and aviations due to their special characteristics such as high strength to weight ratio. As the fiber reinforced composites are used as structural materials, they are sometimes used in more complex environments such as in high temperature application. Under thermal aging condition, thermal stresses may develop in composite laminates due to the difference in the coefficient of thermal expansion of the fibers and the matrix. This environment is known to cause degradation of composite materials. For this reason, an experiment is done to investigate the effect of thermal aging to the impact characteristics of the structures. In this study, two different types of glass fiber reinforced epoxy with varied fiber orientation are studied after being impacted by a standard drop weight with 10-J impact energy. Thermal aging is performed by exposing the sample to the temperature of 1000C for 50 hours. The damage zone are studied by using ultrasonic non-destructive inspection. The impact resistance of both form of fibers are declined when subjected to thermal aging. The damage area produced is larger and it shows that extreme temperature greatly affect the structural intergrity of the structures. Thick woven glass reinforced composite shows the best structural behavior with minimal damage area. Thin chopped glass fiber reinforced composite has the lowest impact resistance among the others which produce the largest damage area. The test revealed the woven glass fiber are more ductile than the chopped glass fiber

The Design and Fabrication of NOS~ ciku Harvester

A device for harvesting ciku has been successfully constructed. It has a system enabling the fruit to be measured and harvested intact and with ease. It can be modified to harvest other fruits requiring a horizontal cutting motion due to their orientation on the tree

Seasonal return and firm size effect in the Malaysian Stock Market

This study examine the existence of seasonal return and firm-size effect in the Malaysian stock market. The results reveal that there are evidence of the January effect, the Chinese New Year effect, and the reverse August effect. Since there is no capital gain tax in Malaysia, the tax loss selling hypothesis cannot explain the January effect. Instead, the anomaly may be best explained by the market integration hypothesis in view that the January effect is also a worldwide phenomenon. The higher return observed in February indicates the presence of the Chinese New Year effect, which is attributed to the dominant role of the ethnic Chinese investors in the Malaysian stock market. Both effects are more robust in smaller companies as compared to larger firms indicating the existence of the firm size effect. The reverse August effect is reflected by the negative return in August which is due to the significantly lower trading activities during the month

Energy Expenditure of a Group of Students at Universiti Pertanian Malaysia

The energy expenditure of 42 students of Universiti Pertanian Malaysia was monitored for seven days. The average daily energy expenditure of male students was higher than that of the females (2804 kcal vs 2725 kcal). Other than sleeping, the other major activities the students involved in were studying (writing and reading) and walking

Profit-Sharing Deposit Accounts in Islamic Banking: Analysing the Perceptions and Attitudes of the Malaysian Depositors

Islamic banking deposits are fundamentally structured in a different way than the conventional banking deposits. Each type of Islamic banking deposits, such as savings, demand, and timed deposits, is devised using the approved Shari’ah contracts such as qard, wadiah, murabahah, and mudarabah. These contracts are opposed to the conventional concepts, as they are based on the concept of a ‘lender-borrower’ relationship. In addition, the Shari’ah-approved contracts are unique as they feature a different nature of risk and return. This is especially the case for mudarabah contracts (henceforth referred to as profit-sharing contracts). The uniqueness of profit-sharing contracts in deposit products has been given due recognition in theory and also in practice, as most of the Islamic banks in Malaysia offered this product. In addition, the unique features and characteristics of profit-sharing based deposit accounts are also highlighted in the prudential standards issued by prominent regulatory bodies such as AAOIFI and IFSB which, have been adopted by the Bank Negara Malaysia (Central Bank of Malaysia). Nevertheless, it is argued by many Islamic banks practitioners, especially in Malaysia, that the concept of profit-sharing in deposits products is not practical in reality, because the depositors do not behave according to, nor accept the principles that have been laid down in the Shari’ah. Thus it is argued that both the depositors and the Islamic bankers have treated the product similar to any other conventional banking deposits products. The main aim of this study, hence, is to explore and examine the level of awareness, knowledge, perceptions, and attitude of the Islamic banking depositors in Malaysia towards characteristics of profit-sharing deposits accounts in accordance with the fundamental Shari’ah principles but also the regulations prevailing. In addition, this research also attempts to explore the significant determinant factors that encourage the depositors to engage with Islamic banking deposits accounts in general and profit-sharing deposits accounts in particular. In fulfilling the aim of the study, primary data collection research was adopted through a survey questionnaire technique. The questionnaires were distributed to eight Islamic banks representing various types of Islamic banks in Kuala Lumpur and Selangor. The questionnaire asked various pertinent questions, which intended to elicit the depositors’ opinions, perceptions, and attitudes towards the unique characteristics of profit-sharing contract as specified in Shari’ah muamalah principles. The characteristics among others are: (i) concept of uncertain deposits returns; (ii) concept of non-guarantee for the deposits; (iii) concept of profit equalization reserve. A total 649 of the returned questionnaires were complete and fit for analysis purpose. The data were analysed using various statistical analysis techniques ranging from simple frequency distribution analysis to the more advanced analyses such as non-parametric statistical analysis, factor analysis, and logistic regression. In general, the results of the study show that the level of awareness of the need to have Islamic banking deposits accounts because of religious reasons is considered as high among the Malaysian depositors. Nevertheless, the results also indicate that a high level of awareness is not being translated into a high level of understanding concerning the objectives of the products which are structured in accordance to the Shari’ah-compliant contracts. This can be seen in the major findings of this study: the characteristics of profit-sharing contracts, which arguably are the most desirable Shari’ah-compliant contracts, are not acceptable to the depositors. This indirectly implies that they are still strongly influenced by the nature of conventional banking products. In addition, the logistics regression results further proved that related factors (‘financial services’ and ‘income’) emerged as the main determinants in creating demand for profit-sharing deposits accounts. The results of the research should draw the attention of the Islamic bankers and also the regulators to finding ways for improving the level of understanding among the depositors. However, the critical successful factor in educating the depositors is highly dependent on the level of knowledge exhibited by the Islamic bankers themselves, which can be a real concern as highlighted by the findings of this study

A Study on Social Network Blogs as Political Tool on Information Technology Students' Perspective

The developments of newest communication technology, especially web based applications such as weblogs, have changed the media landscape. In countries with controlled media system, the emergence of weblogs provides an option medium to those who want to disseminate views generally suppressed by the mainstream media. Issues deemed sensitive by the local media seldom get due coverage. Even if there is coverage, it is presented from the viewpoint that is consistent with the views and philosophy of the elite and the government. Departing on the premise that blogging offers a relatively wider public sphere than the print media; discourses on political issues on different forms. Hence, this paper examines and discusses the perception, acceptance and belief of UUM IT student through political blog

Kajian Awal Kepadatan Meiofauna dalam Paya Bakau Teluk Mengkabung, Sabah

A study on meiofaunal densites was carried out in Teluk Mengkabung, Sabah from August 1988 to January, 1989. The meioJauna was sampled and several physico-chemical characteristics on the interstitial water was measured. The density of meiofauna in Teluk Mengkabung, Sabah was between 292-1193 individuals 1()l cm-2. Nematodes was the dominant taxon followed by harpacticoid copepods. The density of nematodes was between 238-996 individuals 1()f cm-2 and harpacticoid copefJod was 26-216 individuals 1()J cm-2. The meiofaunal densities of Teluk Mengkabung, Sabah were found to be influenced by salinity, dissolved oxygen and porosity of the interstitial water