Corporate “dash-for-cash” amidst the Covid-19 Pandemic: Evidence from an Emerging Economy

Published Online: 09 September, 2024 || Published in Print: 20 September, 2024

Authors

  • Dung Viet Tran Banking Academy of Vietnam Hanoi, Vietnam Author
  • M. Kabir Hassan University of New Orleans Author
  • Mohammad Dulal Miah College of Banking and Financial Studies, Muscat, Oman Author

DOI:

https://doi.org/10.54728/JFMG.202408.00080

Keywords:

Pandemic, Cash holdings, Investment, Emerging economies, Dividend

Abstract

This paper seeks to examine the impact of Covid-19 pandemic on corporate cash holding. The research collects data from 531 listed Vietnamese firms for the period 2020Q1-2021Q1. The data are analyzed using panel Fixed Effect model. Results show that corporations hoard more cash in response to the Covid-19 pandemic. This can be attributed to firms’ precautionary purpose and investment delays to a limited extent. Firms’ increased cash holdings are channeled through conservative payout policy. The results further reveal that hoarding cash amid the pandemic alleviates the adverse impacts of the Covid-19 outbreak on investment. Previous studies identified various determinants that affect firms’ cash holding. Our study adds another critical factor, a rare disaster, as an important determinant of corporate cash policy.

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Published

2024-09-09

Issue

Vol. 3 No. 1

Section

Articles

How to Cite

Dung Viet Tran, M. Kabir Hassan, & Mohammad Dulal Miah. (2024). Corporate “dash-for-cash” amidst the Covid-19 Pandemic: Evidence from an Emerging Economy: Published Online: 09 September, 2024 || Published in Print: 20 September, 2024. Journal of Financial Markets and Governance, 3(1), 01-13. https://doi.org/10.54728/JFMG.202408.00080