Next Article in Journal
The Predictability of the Exchange Rate When Combining Machine Learning and Fundamental Models
Next Article in Special Issue
Comparison of Prediction Models Applied in Economic Recession and Expansion
Previous Article in Journal
Prevention Is Better Than the Cure: Risk Management of COVID-19
Previous Article in Special Issue
An Ensemble Classifier-Based Scoring Model for Predicting Bankruptcy of Polish Companies in the Podkarpackie Voivodeship
Open AccessArticle

Corporate Bankruptcy Prediction Model, a Special Focus on Listed Companies in Kenya

1
Department of Finance, Szent Istvan University, 2100 Gödöllő, Hungary
2
Twenty Four Secure Security Services, Nairobi 50353-00100, Kenya
3
BSS Department, Jomo Kenyatta University of Agriculture and Technology, Karen 62000-00200, Nairobi, Kenya
*
Author to whom correspondence should be addressed.
J. Risk Financial Manag. 2020, 13(3), 47; https://doi.org/10.3390/jrfm13030047
Received: 23 January 2020 / Revised: 25 February 2020 / Accepted: 26 February 2020 / Published: 4 March 2020
Predicting bankruptcy of companies has been a hot subject of focus for many economists. The rationale for developing and predicting the financial distress of a company is to develop a predictive model used to forecast the financial condition of a company by combining several econometric variables of interest to the researcher. The study sought to introduce deep learning models for corporate bankruptcy forecasting using textual disclosures. The study constructed a comprehensive study model for predicting bankruptcy based on listed companies in Kenya. The study population included all 64 listed companies in the Nairobi Securities Exchange for ten years. Logistic analysis was used in building a model for predicting the financial distress of a company. The findings revealed that asset turnover, total asset, and working capital ratio had positive coefficients. On the other hand, inventory turnover, debt-equity ratio, debtors turnover, debt ratio, and current ratio had negative coefficients. The study concluded that inventory turnover, asset turnover, debt-equity ratio, debtors turnover, total asset, debt ratio, current ratio, and working capital ratio were the most significant ratios for predicting bankruptcy. View Full-Text
Keywords: bankruptcy; insolvency; financial distress; default; failure; forecasting methods bankruptcy; insolvency; financial distress; default; failure; forecasting methods
MDPI and ACS Style

Ogachi, D.; Ndege, R.; Gaturu, P.; Zoltan, Z. Corporate Bankruptcy Prediction Model, a Special Focus on Listed Companies in Kenya. J. Risk Financial Manag. 2020, 13, 47.

Show more citation formats Show less citations formats
Note that from the first issue of 2016, MDPI journals use article numbers instead of page numbers. See further details here.

Article Access Map by Country/Region

1
Back to TopTop