Performance Of Eps For Public Bank Berhad Finance Essay

Different types of investors tend to be attracted to different types of the houses. When investors choose to put in common stocks, they ever look at the house ‘s net incomes. Even though a company does non hold to demo a net income to pay dividends, net incomes are still considered a critical nexus in the dividend determination ( Gitman & A ; Joehnk, 2008 ) . EPS provides a convenient step of the sum of net incomes available to shareholders. The shareholders of company expression at EPS to gauge growing which will impact future stock monetary value. It is because EPS is considered one of the primary drive forces behind stock monetary value. Past public presentation of EPS can be a good index for future public presentation.

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Presents, investor or shareholder non merely look at net income, return on equity or investing in securities to mensurate public presentation of that company. Net incomes per portion are another factor to be considered by them to mensurate the strength of company. Therefore, this research will place the strength of Public Bank Berhad utilizing EPS as index. The factor such as figure of portion outstanding, net income and revenue enhancement disbursals may act upon EPS to increase or diminish.

Therefore, this research is conducted to place dividends paid, retained net incomes and revenue enhancement disbursals. The three variable used in this research is to cognize whether all of them influence net incomes per portion of Public Bank Berhad or non.

BACKGROUND OF COMPANY

One of commercial bank that has good fiscal public presentation in Malaysia is Public Bank Berhad. Public Bank Berhad located in Jalan Ampang, Kuala Lumpur. This bank ranked 3rd in term of plus among the banking group. Public Bank Berhad operates in six sections that are hire purchase operations, retail operations, corporate loaning operations, exchequer and capital operations, investing banking operations and fund direction operations. For 2009, on the dorsum of a strong 10.2 % growing in net involvement and funding income, Public Bank Berhad pre-tax net income is RM3.32 million. Entire plus addition from RM196.16 billion in 2008 to RM217.14 billion in 2009. It shows that Public Bank Berhad has a strong fiscal public presentation.

Since 1966, Public Bank Berhad has won many award such as became the largest banking group in Malaysia by market capitalisation and 1st Malayan bank to publish advanced intercrossed Tier-1 capital securities in both the international market in US Dollars of USD200 million and in the domestic market in Ringgit of RM1.2 million. The Public Bank Berhad ‘s EPS maintain on increasing from twelvemonth to twelvemonth show that this company has a good and strong fiscal public presentation. Other than that, Public Bank Berhad is the bank that have the lowest sum of non-performing loan among commercial bank in Malaysia.

Performance OF EPS FOR PUBLIC BANK BERHAD

GRAPH 1 – Performance of Net incomes per Share

Graph 1 shows the tendency of net incomes per portion from 1998 until 2010. The highest value is 83.8 for 2010 whereas the lowest EPS declared on 1998 by 2.3. The Public Bank declares the highest EPS in 2010 because the bank has a strong fiscal public presentation. The stockholders ‘ fund grew in tandem with the strong implicit in net incomes recorded for. EPS is lower in 1998 is because Malaysia has faced fiscal crisis in 1997. So, there have some consequence for Public Bank Berhad in the following twelvemonth, 1998.

Problem Statement

EPS is considered one of the primary forces behind portion market monetary value. Company who declare higher EPS is a company that has a good fiscal public presentation such as Public Bank Berhad. Sometimes people think that companies which have high net income will hold high EPS. Actually, figure of outstanding common stock will act upon company to declare higher or lower EPS. Other than that, there are several factor that influence EPS. Problem statements are developed to analyse the factors that influence net incomes per portion.

Does dividends paids leads to alterations in net incomes per portion of Public Bank Berhad?

Does a maintained net incomes influence net incomes per portion of Public Bank Berhad?

Does sum of revenue enhancement disbursals may diminish net incomes per portion of Public Bank Berhad?

Aim OF STUDY

GENERAL OBJECTIVE

To analyze the relationship between dividends paid, revenue enhancement, and retained net incomes towards net incomes per portion of Public Bank Berhad.

Specific OBJECTIVES

To find the relationship between dividends collectible and EPS of Public Bank Berhad.

To place whether revenue enhancement disbursals has important impact on EPS of Public Bank Berhad.

To happen out whether maintained gaining influence EPS of Public Bank Berhad.

Scope OF STUDY

The range of this survey analyzes 13 old ages fiscal public presentation of Public Bank Berhad. It is cover from 1998 until 2010. For the purposed of this survey, the research worker used three ( 3 ) independent variables, which are dividends paid, retained net incomes and revenue enhancement disbursals. This survey will concentrate on the net incomes per portion which is related to dividends paid and retained net incomes. Tax disbursals besides have an impact on net incomes per portion because it reduced net net incomes of the company.

SIGNIFICANT OF STUDY

This survey is conduct to analyse the factors that contribute EPS of Public Bank Berhad. The result of this survey will help information for ;

University

This survey will supply more information about net incomes per portion. Other pupil will hold more mentions in the hereafter about factor that act uponing net incomes per portion. They will used to assist them in carry oning other research in the same field. Other than that, university besides can utilize to increase reading stuff in library.

Banking Sector

This result of this survey will assist banking sector to keep or better net incomes and other factor that will take to the higher EPS. It is of import because higher EPS will demo that the bank public presentation is good.

Management Team of Public Bank Berhad

This survey is a instance survey of Public Bank Berhad. All information gathered is related to Public Bank Berhad. So, this survey is utile for direction squad of Public Bank Berhad to allow them cognize about the factors that contribute the earning per portion. They besides can do disciplinary action to better their fiscal place in order to declare higher EPS in future.

LIMITATIONS OF STUDY

Variables

This survey merely considers three ( 3 ) of import variables. There have some others variables that influence gaining per portion but it is non excessively much.

Lack of informations

Data for this survey was obtained from cyberspace beginning that is website of Public Bank Berhad. The beginnings of informations are really limited. Some informations are non published in the cyberspace any longer. In the web site of Public Bank Berhad, there provides 3 old ages merely one-year study.

Accuracy of informations

The information is secondary informations because it is gathered from cyberspace beginnings. So, the truth informations depends on the published stuffs. Sometimes informations are non available for that clip of period. So, it will impact the truth of the consequence.

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