DIVIDEND PAYMENT BEHAVIOUR: EVIDENCE FROM MALAYSIA

The Malaysian financial market is governed and regulated by the Bursa Malaysia Berhad, an indicator of Malaysian financial market. Dividend policy in Malaysian companies is often inflexible as most of the firms are unwilling to cut or keep away from omitting dividends even when the company’s earnings are falling. This research examined whether there is any correlation between earnings, firm’s size and liquidity with dividends payout ratio. This research utilized data from companies of three different selected sectors over period of six years from 2009 to 2014. From the results obtained, this research confirms that profitability, firm size and liquidity are the important determinants of dividend payment in Malaysia. There is also great influence of industry on payout decision in Malaysia. The companies studied appear to be reluctant to neglect dividend even when they suffer losses.