The 2008 global financial crisis : effects of firm characteristics on the performance of Singapore companies.

Abstract

This paper examines the impact of firm characteristics on Singapore companies’ performances both during and after the 2008 Global Financial Crisis. Our dataset consisted of firms which are headquartered in Singapore and listed on the Singapore Exchange (SGX), excluding financial and utilities firms, bond funds, exchange-traded funds and real estate investments trusts.

Our findings suggest that firms with greater foreign sales, more leverage and higher capital expenditure would be more adversely impacted by the crisis, while firms with higher capital expenditure recover more slowly. This implies that investors, portfolio and fund managers who seek a more conservative portfolio would avoid investing in firms with the abovementioned characteristics. Financial institutions and the Singapore government could also extend lines of credit to financially distressed companies, enabling them to better withstand the crisis.