The Impact of Financial Structure on Financial Security in an Emerging Market

This paper aims to understand the extent and trend of the impact of financial structure on the financial security of companies in an emerging economy. The paper uses panel data collected from 2010 to 2023 at Vietnamese real estate companies. OLS, FEM, REM regression models and necessary tests are applied in turn. GMM regression is used to overcome the shortcomings of the model. The research results show that financial security will be high in companies with high debt ratios and return on assets. In contrast, financial stability will be low in companies with high fixed asset ratios, inventory ratios, return on equity, and years of establishment. The findings also show that financial safety will decrease in companies with high receivables ratios, cash and cash equivalents ratios, return on equity, and large size. To our knowledge, this is the first quantitative study to examine the effect of financial structure on financial security from two aspects: financial safety and stability. This is also the first study to address financial structure from three perspectives: capital structure, asset structure, and the relationship between assets and capital. Doi: 10.28991/ESJ-2025-09-02-04 Full Text: PDF