scholarly journals Bank Risk Profile, Good Corporate Governance And Company Values in Banking Companies Go Public in Indonesia

2017 ◽  
Vol 20 (1) ◽  
pp. 41
Author(s):  
Susi Retna Cahyaningtyas ◽  
Elin Erlina Sasanti ◽  
Wahidatul Husnaini
Keyword(s):  
Good Alternative ◽  
Positive Influence ◽  
Risk Profile ◽  
Capital Adequacy ◽  
Moderate Risk ◽  
Minimum Capital ◽  
Inherent Risk ◽  
Company Value ◽  
Alternative Means ◽  
The Impact

The latest Bank Indonesia Regulation No.14/18/PBI/2012 requires bank to have minimum capital of 8%-14% depends on the risk profile of each bank. Therefore, the main objective of this research is to assess whether the total of inherent risk profile of each bank meets the terms of this regulation. In addition, this study aims to examine the impact of inherent risk profile and GCG on the banking company value. The sample in this study is determined by purposive sampling method and resulted in 24 banks or 72 observations during 2011-2013. The results showed that 23 banks had low risk and low to moderate risk, and only one bank had moderate risk. The results also showed that inherent risk profile rating is equivalent to capital adequacy. In other words, inherent risk profile of these banks have complied with Bank Indonesia Regulation No.14/18/PBI/2012. Furthermore, this study indicated that GCG has significant and positive influence on the company value, while the inherent risk has no influence on the company value. Overall, this study suggest that go public banks in Indonesia are one of good alternative means of investment for its soundness as reflected by the fulfillment of minimum capital ratio required by the regulator.

scholarly journals Regulatory Capital is a Panacea for Efficiency, Credit Growth and Reducing Non-Performing Loans in Commercial Banks

2021 ◽  
Vol 16 (2) ◽  
pp. 265-287
Author(s):  
Amina Malik ◽  
◽  
Babar Zaheer Butt ◽  
Shahab Ud Din ◽  
Haroon Aziz ◽  
...  
Keyword(s):  
Commercial Banks ◽  
Financial Statements ◽  
Capital Adequacy ◽  
Regulatory Capital ◽  
Credit Growth ◽  
Minimum Capital ◽  
Capital Adequacy Ratio ◽  
The Impact ◽  
Interest Margin

This study examined the effectiveness of regulatory capital in enhancing efficiency and credit growth and reducing bad loans in commercial banks listed on the Pakistan Stock Exchange (PSX) from 2010 to 2019. Precisely, the impact of capital adequacy ratio (CAR) was studied on net interest margin (NIM), credit growth (CR) and non-performing loans (NPLs). The impact of capital adequacy regulations was assessed by retrieving data from financial statements analysis (FSA), Bank Financial statements and the World Bank website. Panel regression models including ordinary least squares (OLS), fixed and random effects under robust title were applied in this study. Results revealed that the implementation of stringent CAR plays the role of panacea and increases interest margin & credit growth and a reduction of NPL in Pakistani commercial banks. The study provides practical results for regulators to customize regulations on credit growth to reduce non-performing loans and maintain healthy growth of loans by not compromising on interest margins as well as maintenance of minimum capital adequacy ratios. With the high significance of stringent minimum capital adequacy for banks, the findings of the study are valuable for regulators, banks, auditors and investors, as capital adequacy ratio commonly plays the role of Panacea in terms of efficiency, credit growth and reduction in non-performing loans. Keywords: capital adequacy ratio, efficiency, credit growth, non-performing loans

scholarly journals The Impact of Non-Performing Loans, Return on Assets, Return on Equity, and Loan to Deposit Ratios on Minimum Capital Adequacy Requirement Based on Commercial Banks for Business Activities (BUKU) I 2015-2020

2021 ◽  
Vol 6 (6) ◽  
pp. 42-46
Author(s):  
Rano Rahadian ◽  
Dudi Permana
Keyword(s):  
Panel Data ◽  
Commercial Banks ◽  
Capital Adequacy ◽  
Return On Assets ◽  
Financial Reports ◽  
Return On Equity ◽  
Minimum Capital ◽  
The Impact

The purpose of this research is to gain an understanding of The Impact of Non-Performing Loans, Return on Assets, Return on Equity, and Loan to Deposit Ratios on Minimum Capital Adequacy Requirement Based on Commercial Banks for Business Activities (BUKU) I 2015-2020. The data of this research is obtained from financial reports published by each bank in 2015 to 2020 period. This research uses panel data processed using EViews software version 9.0. The results show that NPL negatively and insignificantly affects CAR. ROA gives positive and insignificant impacts toward CAR, while ROE causes negative and insignificant effects on CAR. In addition, there is positive and significant impacts on CAR caused by LDR.

scholarly journals A Study on the Impact of Capitalization on the Profitability of Banks in Emerging Markets: A Case of Pakistan

2020 ◽  
Vol 13 (9) ◽  
pp. 217
Author(s):  
Muhammad Haris ◽  
Yong Tan ◽  
Ali Malik ◽  
Qurat Ul Ain
Keyword(s):  
Generalized Method Of Moments ◽  
Capital Adequacy ◽  
Optimum Level ◽  
Minimum Capital ◽  
Minimum Capital Requirement ◽  
Net Interest Margin ◽  
Capital Adequacy Ratio ◽  
Unique Nature ◽  
The Impact ◽  
The Relationship

A strong capitalized position of financial institutions is essential to ensure their solvency. Because of their unique nature, banks must always keep an optimum level of capital to ensure smooth banking earnings. Consequently, it is mandatory for all types of banks operating in Pakistan to keep a minimum amount of required capital along with capital adequacy to remain solvent and profitable. Therefore, using three measures of capitalization, i.e., the Capital Ratio (CR), Capital Adequacy Ratio (CAR), and Minimum Capital Requirement (MCR), and four measures of profitability, i.e., Return on Avg. Assets (ROAA), Return on Avg. Equity (ROAE), Net Interest Margin (NIMAR), and Profit Margin (NMAR), this study contributes to the existing literature on the relationship between the capitalization and profitability of 29 Pakistani banks over the period of 2007–2018. The results, based on the Generalized Method of Moments (GMM) system estimator technique, reported an inverted U-shaped relationship between the two capitalization measures, i.e., CR and CAR, and the four profitability measures, i.e., ROAA, ROAE, NIMAR, and NMAR. This indicates that profitability increases with an increase in capitalization up to a certain level, while beyond that level, a further increase in capitalization decreases profitability. The results also indicate that banks who maintain their MCR have higher profitability than those who do not.

scholarly journals THE IMPACT OF NON PERFORMING FINANCE (NPF), CAPITAL ADEQUACY RATIO (CAR), AND FINANCING DEPOSIT RATIO (FDR) TO RETURN ON ASSET (ROA) WITH DEPOSITOR FUNDS AS A MODERATING VARIABLE IN ISLAMIC BANKS

2018 ◽  
Vol 1 (2) ◽  
pp. 168
Author(s):  
Ahmad Syifa
Keyword(s):  
Positive Influence ◽  
Capital Adequacy ◽  
Test Analysis ◽  
Internal Factors ◽  
Moderating Variables ◽  
Capital Adequacy Ratio ◽  
The Social ◽  
Positive Score ◽  
The Impact

Return On Asset (ROA) is one of the profitability indicators, this study aimed to know the effect of several internal factors; non performing financing (NPF), capital adequacy ratio (CAR) and financing to deposit ratio (FDR) and depositors funds to Return on Asset (ROA) in Islamic commercial bank in Indonesia. This study uses a sensus method from January 2009 to December 2015. Testing the hypothesis in this study is done by using multiple linier regression test analysis and test interaction moderated regression analysis (MRA) by using Statistical Package for the Social Sciences (SPSS) 23. Result of this research hypothesis show that in the model seen a significant influence on non performing financingand capital adequacy ratio to ROA with probability value (sig-t) 0,000 lowerthan 0,05, and the value of coefficient regression are -0,349 and -0,114 with negative score, it means that if NPF or CAR increase it can make ROAdecreasing. The result of third hypothesis shows that FDR has significantinfluence to ROA with probability value (sig-t) 0,019 lower than 0,05 and the value of coefficient regression is 0,028, it means that FDR has positive influence to ROA. This study also demonstrates the role of moderating variables that can be seen from the result of fourth until sixth hypothesis testing that significantly influence to ROA with probability value (sig-t) score 0,000, 0,022 and 0,003 lower than 0,05 and have coefficient regression value equal 1,029, 0,391 and 0,073 with positive score. Statistical of F test shows that Fcal equal to 24,053 while F table at 0,846, so that F cal > F table. It means that independent variablessuch as NPF, CAR, FDR, and DPK significantly influence to Return on Asset.

scholarly journals The impact of the Bank of Russia’s macroprudential policy on the risk exposure of banks’ consumer loan portfolios

2021 ◽  
Vol 80 (3) ◽  
pp. 73-93
Author(s):  
Dmitry Miroshnichenko ◽  
Keyword(s):  
Time Frame ◽  
Risk Profile ◽  
Capital Adequacy ◽  
Risk Exposure ◽  
Macroprudential Policy ◽  
Debt Burden ◽  
Loan Portfolios ◽  
Consumer Lending ◽  
The Impact ◽  
Reporting Data

In this paper, the author examines the efficiency of risk weight add-ons introduced by the Bank of Russia depending on borrowers’ debt burden in terms of discouraging high-risk unsecured rouble consumer lending and the effect of these add-ons on banks’ capital adequacy. The analysis is based on open bank reporting data for the period from October 2019 through August 2020. We show that in this time frame, most banks increased their capital. At the same time, the results obtained do not enable us to confirm the hypothesis that this measure has a pronounced effect on the reduction of the risk profile of consumer loan portfolios. We demonstrate that one of the factors that influenced the efficiency of measures introduced by the regulator is the substantially higher profitability of retail lending as compared to corporate lending.

Basel Capital Adequacy Ratio Standard in The Light of Islamic Law Perspective

2016 ◽  
Vol 1 ◽  
pp. 308-317
Author(s):  
Adi Rahmanur Ibnu
Keyword(s):  
Financial Crises ◽  
Global Economy ◽  
Banking Sector ◽  
Islamic Law ◽  
Capital Requirements ◽  
Capital Adequacy ◽  
Minimum Capital ◽  
Capital Adequacy Ratio ◽  
Global Banking ◽  
Banking Development

Bank is one of the most important pillars of economy activities. However, banking sector has a real potential crisis threat. Alongside with the steady current global banking development, financial crises that have happened clearly affected global economy. Based on that situation, BIS (Bank for International Settlement) – an international financial standard setting organization, realizes the urgency to establishan international financial standard and supervision to anticipate future potential financial crises. This research aims to identify how Capital Adequacy Ratio Standard in Basel Capital Accord (II) based on Islamic law perspective. The research is conducted by analyzing Basel Capital Accord published by BIS. The research uses library research method to find out the aimed result. The focus is on the 1st pillar of Basel II publication that is Minimum Capital Requirements (CAR) policy. CAR, as an Islamic economics policy, will be analyzed using falāḥ approach. Falāḥ is an Islamic economics objective that consists of happiness, success, accomplishment or good luck concept. The earthly dimension of falāḥ has some parameters that can be used to analyze Islamic economics policy. Additionally, the Islamic fiqh maxim takes part in analyzing the policy. The maṣlaḥat concept in fiqh maxim approach shares aim with falāḥ concept in the sense that all of sharia law aims for success, happiness, eternal survival etc. The maṣlaḥat can be accomplished by extinguishing mafsadat or seizing maṣlaḥat. The maṣlaḥat aspect is essential to determine the compatibility Basel Capital Accord with jurisprudential maxim i.e harm must be dispelled (al-dharāru yuzāl). The conclusion results are, 1) Basel Capital Accord focuses on macro-prudential aspect in order to anticipate potential financial crises, 2) beneficial/interest (maṣlaḥat) aspects of the hereafter, cooperation principle, justice, fairness and the prohibition of exploitation are not the core value of Basel Capital Accord frame work, thus 3) the achievement of maslahat as intended by sharia i.e. jurisprudential maxim are not convincing. Therefore, 4) Basel Capital Accord as a regulation basis is not in line with jurisprudential maxim i.e harm must be dispelled (al-dharāru yuzāl).

Islamic Banking Regulations in Light of Basel II

2010 ◽  
Vol 27 (1) ◽  
pp. 74-101 ◽  
Author(s):  
M. Kabir Hassan ◽  
Muhammad Abdul Mannan Chowdhury
Keyword(s):  
Financial Institutions ◽  
Banking Regulation ◽  
Capital Requirements ◽  
Basel Ii ◽  
Capital Adequacy ◽  
Regulatory Agencies ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Minimum Capital ◽  
Regulatory Standards

This paper seeks to determine whether the existing regulatory standards and supervisory framework are adequate to ensure the viability, strength, and continued expansion of Islamic financial institutions. The reemergence of Islamic banking and the attention given to it by regulators around the globe as to the implications of a recently issued Basel II banking regulation makes this article timely. The Basel II framework, which is based on minimum capital requirements, a supervisory review process, and the effective use of market discipline, aligns capital adequacy with banking risks and provides an incentive for financial institutions to enhance risk management and their system of internal controls. Like conventional banks, Islamic banks operate under different regulatory regimes. The still diverse views held by the regulatory agencies of different countries on Islamic banking and finance operations make it harder to assess the overall performance of international Islamic banks. In light of the increased financial innovation and diversity of instruments offered in Islamic finance, the need to improve the transparency of bank operations is particularly relevant for Islamic banks. While product diversity is important in maintaining their competitiveness, it also requires increased transparency and disclosure to improve the understanding of markets and regulatory agencies. The governance of Islamic banks is made even more complex by the need for these banks to meet a set of ethical and financial standards defined by the Shari`ah and the nature of the financial contracts banks use to mobilize deposits. Effective transparency in this area will greatly enhance their credibility and reinforce their depositors and investors’ level of confidence.

scholarly journals A Peri-Implant Disease Risk Score for Patients with Dental Implants: Validation and the Influence of the Interval between Maintenance Appointments

2019 ◽  
Vol 8 (2) ◽  
pp. 252 ◽  
Author(s):  
Miguel de Araújo Nobre ◽  
Francisco Salvado ◽  
Paulo Nogueira ◽  
Evangelista Rocha ◽  
Peter Ilg ◽  
...  
Keyword(s):  
High Risk ◽  
Risk Score ◽  
Disease Risk ◽  
Disease Incidence ◽  
Risk Groups ◽  
Risk Profile ◽  
Moderate Risk ◽  
C Statistic ◽  
Disease Risk Score ◽  
Very High

Background: There is a need for tools that provide prediction of peri-implant disease. The purpose of this study was to validate a risk score for peri-implant disease and to assess the influence of the recall regimen in disease incidence based on a five-year retrospective cohort. Methods: Three hundred and fifty-three patients with 1238 implants were observed. A risk score was calculated from eight predictors and risk groups were established. Relative risk (RR) was estimated using logistic regression, and the c-statistic was calculated. The effect/impact of the recall regimen (≤ six months; > six months) on the incidence of peri-implant disease was evaluated for a subset of cases and matched controls. The RR and the proportional attributable risk (PAR) were estimated. Results: At baseline, patients fell into the following risk profiles: low-risk (n = 102, 28.9%), moderate-risk (n = 68, 19.3%), high-risk (n = 77, 21.8%), and very high-risk (n = 106, 30%). The incidence of peri-implant disease over five years was 24.1% (n = 85 patients). The RR for the risk groups was 5.52 (c-statistic = 0.858). The RR for a longer recall regimen was 1.06, corresponding to a PAR of 5.87%. Conclusions: The risk score for estimating peri-implant disease was validated and showed very good performance. Maintenance appointments of < six months or > six months did not influence the incidence of peri-implant disease when considering the matching of cases and controls by risk profile.

scholarly journals Financial Institutions’ Risk Profile and Contribution to the Sustainable Development Goals

2021 ◽  
Vol 13 (14) ◽  
pp. 7738
Author(s):  
Nicolás Gambetta ◽  
Fernando Azcárate-Llanes ◽  
Laura Sierra-García ◽  
María Antonia García-Benau
Keyword(s):  
Sustainable Development ◽  
Financial Institutions ◽  
Sustainable Development Goals ◽  
Sustainability Reporting ◽  
Risk Profile ◽  
The Sustainable Development ◽  
Corporate Reporting ◽  
2030 Agenda ◽  
Development Goals ◽  
The Impact

This study analyses the impact of Spanish financial institutions’ risk profile on their contribution to the 2030 Agenda. Financial institutions play a significant role in ensuring financial inclusion and sustainable economic growth and usually incorporate environmental and social considerations into their risk management systems. The results show that financial institutions with less capital risk, with lower management efficiency and with higher market risk usually make higher contributions to the Sustainable Development Goals (SDGs), according to their sustainability reports. The novel aspect of the present study is that it identifies the risk profile of financial institutions that incorporate sustainability into their business operations and measure the impact generated in the environment and in society. The study findings have important implications for shareholders, investors and analysts, according to the view that sustainability reporting is a vehicle that financial institutions use to express their commitment to the 2030 Agenda and to higher quality corporate reporting.

The Impact of the Business Environment on the Formalization of Informal Firms. The Case of Kosovo

Südosteuropa ◽  
2020 ◽  
Vol 68 (4) ◽  
pp. 505-529
Author(s):  
Kujtim Zylfijaj ◽  
Dimitar Nikoloski ◽  
Nadine Tournois
Keyword(s):  
Negative Impact ◽  
Positive Impact ◽  
Business Environment ◽  
Positive Influence ◽  
Policy Implications ◽  
Tax Reforms ◽  
Firm Level ◽  
Characteristics Analysis ◽  
Significant Negative Impact ◽  
The Impact

AbstractThe research presented here investigates the impact of the business environment on the formalization of informal firms, using firm-level data for 243 informal firms in Kosovo. The findings indicate that business-environment variables such as limited access to financing, the cost of financing, the unavailability of subsidies, tax rates, and corruption have a significant negative impact on the formalization of informal firms. In addition, firm-level characteristics analysis suggests that the age of the firm also exercises a significant negative impact, whereas sales volume exerts a significant positive impact on the formalization of informal firms. These findings have important policy implications and suggest that the abolition of barriers preventing access to financing, as well as tax reforms and a consistent struggle against corruption may have a positive influence on the formalization of informal firms. On the other hand, firm owners should consider formalization to be a means to help them have greater opportunities for survival and growth.

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