The Impact of Financing Structure Determinants on Financial Stability (An Analytical Study of a Sample of Iraqi Industrial Companies Listed on the Stock Exchange for the Period (2010-2022)

Abstract

The research sought to determine the impact of Capital Structure Determinants, measured by the ratios of (Firm Size, Age, Asset Tangibility, Profitability, Growth Opportunities, Liquidity, Non-Debt Tax Shield, Earnings Volatility), on Financial Stability, which was measured using the Altman Z-Score model.The study utilized a sample of Iraqi companies listed on the Iraq Stock Exchange (ISX). The research provided a theoretical framework for capital structure determinants and financial stability. In the applied section, the research relied on data from the sample companies listed on the ISX, covering a time series of (12) years from (2010–2022). The statistical software packages (Eviews 13), (AMOS.26), and (Excel) were used for data analysis and hypothesis testing. The research reached a set of conclusions, including that Firm Size was the only determinant that showed a positive and statistically significant relationship with financial stability. This confirms the critical role of size as a decisive factor in explaining corporate behavior in the Iraqi market. None of the other variables demonstrated a statistically significant relationship with financial stability, reflecting the weak influence of these determinants in the Iraqi market environment. Based on these conclusions, the researchers presented a set of recommendations, including (supporting the administrative and financial cadres in Iraqi companies through specialized training programs in capital management and corporate finance to achieve financial stability).