CAMEL RATIO ON PROFITABILITY BANKING PERFORMANCE (MALAYSIA VERSUS INDONESIA)

2017 ◽  
Vol 3 (1) ◽  
pp. 30-39
Author(s):  
Maryam binti Badrul Munir ◽  
Ummi Salwa Ahmad Bustamam
Keyword(s):  
Capital Adequacy ◽  
Return On Assets ◽  
Comparative Performance ◽  
Bank Profitability ◽  
Return On Equity ◽  
Short Period ◽  
Equity Ratio ◽  
Asset Quality ◽  
Descriptive Method ◽  
Interest Expense

Purpose: This research analyzed about profitability banks performance based on the CAMEL (Capital Adequacy, Asset Quality, Management, Earnings and Liquidity) on the Bank's profitability. Capital adequacy measured by debt equity ratio (DER) and non-performing loans (NPL), asset quality measured by return on assets (ROA), management will be measured by cost per income, earnings measured by return on equity (ROE) and liquidity measured by interest expense and deposit.Methodology: The samples were 114 samples (from 10 bank in Malaysia and 9 bank in Indonesia) since 2010-2015. This analysis used descriptive method and multiple regression analysis, the result of this research indicated that banking profitability have a good performance based on CAMEL analysis.Findings: From the results of regression, the CAMEL analysis has a significant relationship to the bank profitabilityPractical Implications: The study demonstrated the use of CAMEL analysis to measure bank profitability. If bank performance declining through the CAMEL analysis so the Bank should make a decision to make a better performance changes of banking.Social Implications: This study was about the importance of camel analysis measuring the performance banking. CAMEL analysis detected the decrease in performance in any business sector.Originality/Value: This analysis adapted and adopted the study conducted by Sahut and Mili(2011), but this study focusedonly on the comparative performance between conventional and Islamic banking between Malaysia and Indonesia.Research Limitations/Implications: Comparison of CAMEL analysis focused on two countries between Malaysia and Indonesia (it also involves the comparative analysis of conventional and Islamic bank) to gain the profitabilityof banking, ROI with short period since 2010 until 2015

Can Capital Structure Affect the Financial Performance of Banks in Turkey?

2018 ◽  
Author(s):  
Merve Tuncay
Keyword(s):  
Capital Structure ◽  
Financial Performance ◽  
Capital Adequacy ◽  
Return On Assets ◽  
Control Variables ◽  
Return On Equity ◽  
Independent Variables ◽  
Earnings Per Share ◽  
Asset Quality ◽  
The Capital Structure

<p>The aim of this study is to investigate the determinants of banks’ financial performance in terms of the capital structure. Annual financial statements of 11 banks traded in Borsa Istanbul are employed for the period of 2006-2016. Return on assets, return on equity and earnings per share are chosen for financial performance measures. The independent variables related to the capital structure are capital adequacy, equity-to-asset, and financial leverage ratios. In addition, macroeconomic variables and bank-specific variables are also considered as control variables for the analysis. The data are analyzed by the panel data regression analysis as it provides more informative finding and less multicollinearity among variables than time series and cross-sectional analyzes.</p><p>The Hausman test results indicate that the random effects model is appropriate for the whole dependent variables. According to the findings; while equity-to-asset ratio affects return on assets positively, amongst the control variables specific to firms, firm size, asset quality and asset growth variables have significant effects on return on assets. It is found no significant effect of independent variables on return on equity, however, it is seen that asset quality has a negative and significant effect. Inflation and interest rates have a significant effect on both variables. Finally, it is seen that equity-to-asset ratio has a positive and significant effect on earnings per share. Only the effect of asset quality on earnings per share is found to be significant among the control variables. Findings of the study are consistent with the previous studies. In addition, the M&amp;M views are not supported by the findings related to return on assets and earnings per share but the return on equity.</p>

Can Capital Structure Affect the Financial Performance of Banks in Turkey?

2019 ◽  
Vol 4 (1) ◽  
pp. 17
Author(s):  
Merve Tuncay
Keyword(s):  
Capital Structure ◽  
Financial Performance ◽  
Capital Adequacy ◽  
Return On Assets ◽  
Control Variables ◽  
Return On Equity ◽  
Independent Variables ◽  
Earnings Per Share ◽  
Asset Quality ◽  
The Capital Structure

<p>The aim of this study is to investigate the determinants of banks’ financial performance in terms of the capital structure. Annual financial statements of 11 banks traded in Borsa Istanbul are employed for the period of 2006-2016. Return on assets, return on equity and earnings per share are chosen for financial performance measures. The independent variables related to the capital structure are capital adequacy, equity-to-asset, and financial leverage ratios. In addition, macroeconomic variables and bank-specific variables are also considered as control variables for the analysis. The data are analyzed by the panel data regression analysis as it provides more informative finding and less multicollinearity among variables than time series and cross-sectional analyzes.</p><p>The Hausman test results indicate that the random effects model is appropriate for the whole dependent variables. According to the findings; while equity-to-asset ratio affects return on assets positively, amongst the control variables specific to firms, firm size, asset quality and asset growth variables have significant effects on return on assets. It is found no significant effect of independent variables on return on equity, however, it is seen that asset quality has a negative and significant effect. Inflation and interest rates have a significant effect on both variables. Finally, it is seen that equity-to-asset ratio has a positive and significant effect on earnings per share. Only the effect of asset quality on earnings per share is found to be significant among the control variables. Findings of the study are consistent with the previous studies. In addition, the M&amp;M views are not supported by the findings related to return on assets and earnings per share but the return on equity.</p>

scholarly journals BANK SPECIFIC AND MACRO-ECONOMIC DETERMINANTS OF THE UNITED ARAB EMIRATES COMMERCIAL BANKS PROFITABILITY: A PANEL DATA ANALYSIS

2020 ◽  
Vol 8 (10) ◽  
pp. 661-677
Author(s):  
Jamil Salem Al Zaidanin ◽  
Keyword(s):  
United Arab Emirates ◽  
Commercial Banks ◽  
Capital Adequacy ◽  
Return On Assets ◽  
Bank Profitability ◽  
Macroeconomic Factors ◽  
Economic Determinants ◽  
Return On Equity ◽  
Specific Factors ◽  
Bank Specific Factors

This study attempts to identify the Bank Specific and Macro-economic Determinants of The United Arab Emirates Commercial Banks Profitability measured by Return on Assets, Return on Equity and Net Interest Margin. The study uses bank-specificand microeconomic factors as independentvariables. The bank-specific factors include bank size, capital adequacy, assets quality, liquidity, deposits, diversification ,business mix, and efficiency, while the macroeconomic factors include real Gross Domestic Product growth, Inflation Rate, and Real Interest Rate.Regression models were used to relate bank profitability ratios to the independent variables built on panel data for the period 2013-2019 of sixteen commercial banks operating in the United Arab Emirates.The results of the study show thatassetsize, liquidity, off-balance sheet activities, and diversification have significant impact on profitability as measured by theNet Interest Margin. In addition, loans under follow-up to total loans, and managerial efficiency are found to behighlysignificantvariables of profitability in the context of the United Arab Emirates commercial banks as measured by Return on Assets and Return on Equity. Furthermore, diversification has a significant impact on profitability as measured by Return on Assets. The remaining bank-specific factors (capital adequacy, loans to total assets, liquidity, deposits to assets ratio, and operating expenses to total assets ratio) and macroeconomic factors have no significant effect on bank profitability. The results of the study suggest that banks can improve their profitability through maintaining high operating income, decreasing the size of non-performing loans, full utilization of liquid assets, more concentration on the main activities, efficiently managing their operating expenses, and taking advantage of the Gross Domestic Productgrowth , inflation and Interest Rate changes to improve the banks performance and profitability. In addition, it is recommended to make further studies on the banks performance with an expanded scope which is tobe extended to other industries.

scholarly journals The Impact of Capital on Bank Profitability: Case of Tunisia

2021 ◽  
pp. 7-20
Author(s):  
Mohamed Aymen Ben Moussa ◽  
Hédi Trabelsi ◽  
Adel Boubaker
Keyword(s):  
Capital Adequacy ◽  
Bank Capital ◽  
Return On Assets ◽  
Bank Profitability ◽  
Return On Equity ◽  
Net Interest Margin ◽  
Capital Adequacy Ratio ◽  
The Impact ◽  
The Relationship ◽  
Interest Margin

The capital adequacy ratio measures the ability of a financial institutions to meet its liabilities by comparing its capital with assets. This article studied the relationship between bank capital and bank profitability measured by (Return on assets; return on equity; net interest margin). We used a method of static panel for a sample of 11 banks in Tunisia between (2000…2018). We found that bank capital has a significant impact on ROA. But capital has a non significant effect on bank return on equity and not significant impact on bank net interest margin.

scholarly journals Can Capital Structure Affect the Financial Performance of Banks in Turkey?

2018 ◽  
Author(s):  
Merve Tuncay
Keyword(s):  
Capital Structure ◽  
Financial Performance ◽  
Capital Adequacy ◽  
Return On Assets ◽  
Control Variables ◽  
Return On Equity ◽  
Independent Variables ◽  
Earnings Per Share ◽  
Asset Quality ◽  
The Capital Structure

<p>The aim of this study is to investigate the determinants of banks’ financial performance in terms of the capital structure. Annual financial statements of 11 banks traded in Borsa Istanbul are employed for the period of 2006-2016. Return on assets, return on equity and earnings per share are chosen for financial performance measures. The independent variables related to the capital structure are capital adequacy, equity-to-asset, and financial leverage ratios. In addition, macroeconomic variables and bank-specific variables are also considered as control variables for the analysis. The data are analyzed by the panel data regression analysis as it provides more informative finding and less multicollinearity among variables than time series and cross-sectional analyzes.</p><p>The Hausman test results indicate that the random effects model is appropriate for the whole dependent variables. According to the findings; while equity-to-asset ratio affects return on assets positively, amongst the control variables specific to firms, firm size, asset quality and asset growth variables have significant effects on return on assets. It is found no significant effect of independent variables on return on equity, however, it is seen that asset quality has a negative and significant effect. Inflation and interest rates have a significant effect on both variables. Finally, it is seen that equity-to-asset ratio has a positive and significant effect on earnings per share. Only the effect of asset quality on earnings per share is found to be significant among the control variables. Findings of the study are consistent with the previous studies. In addition, the M&amp;M views are not supported by the findings related to return on assets and earnings per share but the return on equity.</p>

scholarly journals The Role of Using CAMELS Model in Analyzing the Factors Affecting the Performance of The Jordanian Commercial Banks (2014-2019)

2021 ◽  
Vol 17 (2) ◽  
pp. 3-11
Author(s):  
Senan Amer
Keyword(s):  
Quality Management ◽  
Commercial Banks ◽  
Capital Adequacy ◽  
Rate Of Return ◽  
Return On Assets ◽  
Return On Equity ◽  
Factors Affecting ◽  
Management Efficiency ◽  
Asset Quality ◽  
The Impact

In this study, the factors affecting the performance of Jordanian commercial banks have been analyzed using the elements of the CAMELS model, along with identifying the most important factors. The study targeted the impact of twenty Jordanian commercial banks on performance-; these banks were listed on the Amman Stock Exchange during the period of 2014-2019. The researcher used the Data Pooled Regression Method, due to its relevance to the nature of the data used in the study, where this method is used in the case of a time series and cross-sectorial data. The Rate of Return on Assets and the Rate of Return on Equity were used as the two variables on which the banks’ performance was measured. However, the independent variables included the CAMELS model elements which are capital adequacy, asset quality, management efficiency, earnings, liquidity, and sensitivity to market risks, in addition to macroeconomic variables, which include the rate of economic growth and the rate of inflation. The study concluded that capital adequacy, asset quality, management efficiency, and earnings are among the most important and most influential factors with regards to the Jordanian commercial banks, which - are is represented by the Rate of Return on Assets and the Rate of Return on Equity. Moreover, the study also concluded that it is possible to derive a miniature model from the CAMELS model called the CAME model, which has a great ability to explain and measure the performance of commercial banks in Jordan. Finally, the study recommended the Central Bank of Jordan to use the CAMELS model to evaluate Jordanian commercial banks.

scholarly journals ANALISIS KINERJA KEUANGAN PERBANKAN SYARIAH (STUDI EMPIRIS BANK SYARIAH ’’ BADAN USAHA MILIK NEGARA ’’ DI INDONESIA PERIODE 2015-2018)’’

2020 ◽  
Vol 3 (1) ◽  
Author(s):  
Furqonti Ranidiah ◽  
Tezar Arianto
Keyword(s):  
Financial Performance ◽  
Sampling Technique ◽  
Capital Adequacy ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Return On Assets ◽  
Return On Equity ◽  
Islamic Bank ◽  
Measurement Tools ◽  
Equity Ratio

This research is based on the importance of Islamic bank financial performance. Islamic bank financial performance is a picture of the achievements of banks in their operations, both related to the aspects of finance, marketing, collection and distribution of funds, technology, and human resources. This study aims to determine the financial performance of Islamic banking in Indonesia. Performance measurement tools that can be used based on financial statements is to calculate financial ratios so that they can find out the performance using ratio analysis. This research uses a quantitative approach to observe, gather information and present an analysis of research results. The population in this study is state-owned Islamic banks in Indonesia for the period 2015-2018. The sampling technique used was purposive sampling. The number of banks sampled were three Islamic banks. The analytical methods used in this study are Loan to Defosit Ratio (LDR), Capital Adequacy Ratio (CAR), Return on Assets (ROA), Return on Equity (ROE) and Operational Costs Against Operational Income (BOPO). The results of this study obtained the ratio of LDR, CAR and BOPO in Islamic banking financial performance on average have good criteria. While the ROA and ROE ratio of Islamic banking has an average that is not good, for that ratio Return On Assets must be improved, especially in the aspect of managing assets to generate net profit. Likewise, the Return On Equity ratio can have the ability of equity in generating profits and utilizing owned capital capable of generating profits. Keywords: LDR, ROA, CAR, ROE dan BOPO                                                                     

scholarly journals Analisis Perbandingan Kinerja Keuangan Bank Melalui Pendekatan Likuiditas Solvabilitas dan Rentabilitas

2018 ◽  
Vol 9 (1) ◽  
pp. 24
Author(s):  
Ichwan Nur Ihsan ◽  
Yana Ulfah ◽  
Musdalifah Azis
Keyword(s):  
Capital Adequacy ◽  
Return On Assets ◽  
Current Ratio ◽  
Return On Equity ◽  
Capital Adequacy Ratio ◽  
Equity Ratio

Penelitian ini bertujuan untuk menganalisis kinerja keuangan meningkat atau menurun jika ditinjau melalui likuiditas, solvabilitas dan rentabilitas pada Bank BNI dibandingkan dengan Bank BNI Syariah periode 2013-2015. Dalam penelitian ini menggunakan tiga rasio yaitu rasio likuiditas (current ratio dan Loan to Deposit Ratio), rasio solvabilitas (Debt to Equity Ratio dan Capital Adequacy Ratio) dan rasio rentabilitas (Return on Assets dan Retun on Equity). Hasil penelitian pada rasio likuiditas pada Bank BNI dan Bank BNI Syariah pada tahun 2013-2015 dilihat dari hasil perhitungan rata-rata pada Bank BNI (115,43%) dan Bank BNI Syariah (110,5%) adalah Kurang Baik yang mana menurut kriteria Bank Indonesia adalah > 125%. Sedangkan rata-rata loan to deposit ratio pada Bank BNI (87,3%) dan Bank BNI Syariah (94,13%) adalah baik yang mana menurut kriteria Bank Indonesia adalah Baik karena > 78%. Rasio solvabilitas pada Bank BNI dan Bank BNI Syariah pada tahun 2013-2015 dilihat dari analisis debt to equity ratio kinerja keuangan rata-rata perhitungan dari Bank BNI (616,54%) dan Bank BNI Syariah (269,08%) adalah Baik yang mana menurut kriteria Bank Indonesia adalah baik karena > 8%. Sedangkan capital adequacy ratio dapat dikatakan baik karena rata-rata capital adequacy ratio pada Bank BNI (44,9%) dan Bank BNI Syariah (17,82%) adalah Baik yang mana menurut kriteria Bank Indonesia adalah Baik karena > 8%. Dan rasio rentabilitas pada Bank BNI dan Bank BNI Syariah pada tahun 2013-2015 dilihat dari return on assets dapat dikatakan baik karena rata-rata return on assets pada Bank BNI (3,2%) dan BNI Syariah (1,36%) yang dilihat dari rata-rata perhitungan adalah baik yang mana menurut kriteria Bank Indonesia adalah Baik karena > 1,22%. Sedangkan pada hasil return on equity kinerja keuangan pada Bank BNI (21,1%) adalah baik sedangkan pada Bank BNI Syariah (10,62%)adalah kurang baik yang mana menurut kriteria Bank Indonesia kriteria Baik adalah > 17,5%.

scholarly journals Pengaruh Return On Equity, Return On Asset, Dan Net Profit Margin Terhadap Capital Adequacy Ratio (Studi Empiris Pada Perusahaan Sektor Perbankan Konvensional yang Terdaftar di Bursa Efek Indonesia Periode Tahun 2015 – 2018)

2021 ◽  
Vol 6 (1) ◽  
pp. 91-105
Author(s):  
Natrion ◽  
Filda Inacha Zuki
Keyword(s):  
Capital Adequacy ◽  
Profit Margin ◽  
Return On Assets ◽  
Return On Equity ◽  
Profit Margins ◽  
Purposive Sampling ◽  
Capital Adequacy Ratio ◽  
Net Profit ◽  
Asset Quality

Rasio kecukupan modal yang digunakan untuk mengukur kesehatan bank adalah Capital Adequacy Ratio (CAR). Rasio kecukupan modal dapat diukur dari rasio permodalan (capital), rasio aset (asset quality), manajemen (management), rasio laba (earnings), dan rasio likuiditas (liquidity). Penelitian ini bertujuan untuk mengetahui apakah Return On Equity, Return On Assets, dan Net Profit Margins berpengaruh terhadap Capital Adequacy Ratio pada perusahaan sektor perbankan yang terdaftar di Bursa Efek Indonesia (BEI) periode 2015-2018. Desain yang digunakan dalam penelitian ini adalah penelitian kausal, metode yang digunakan adalah metode studi kepustakaan dan metode dokumentasi sedangkan jenis data yang digunakan dalam penelitian ini adalah data sekunder dan populasi yang digunakan adalah sektor perbankan dan terdaftar di Bursa Efek Indonesia untuk periode 2015-2018. Metode pengambilan sampel menggunakan metode purposive sampling. Berdasarkan kriteria yang telah ditentukan diperoleh jumlah sampel perusahaan 28 perusahaan selama 4 tahun, sehingga total sampel adalah 112. Pengujian hipotesis menggunakan analisis regresi linier berganda. Hasil penelitian secara parsial membuktikan bahwa Return On Equity, Return On Assets berpengaruh signifikan terhadap Capital Adequacy Ratio. Sedangkan Net Profit Margin tidak berpengaruh terhadap Capital Adequacy Ratio. Hasil penelitian secara simultan membuktikan bahwa Return On Equity, Return On Assets, dan Net Profit Margin berpengaruh terhadap Capital Adequacy Ratio. Dengan nilai Adjusted R square sebesar 50,4% yang berarti variabel Capital Adequacy Ratio dapat dijelaskan oleh variabel Return On Equity, Return On Asset dan Net Profit Margin.

scholarly journals Analisa Perbandingan Kesehatan Bank Menggunakan Metode Camels

2021 ◽  
Vol 4 (2) ◽  
pp. 764-774
Author(s):  
Santy Pujaraniam ◽  
Sri Hermuningsih ◽  
Agus Dwi Cahya
Keyword(s):  
Asset Management ◽  
Capital Adequacy ◽  
Profit Margin ◽  
Capital Asset ◽  
Return On Assets ◽  
Return On Equity ◽  
Expense Ratio ◽  
Capital Adequacy Ratio ◽  
Net Profit ◽  
Interest Expense

Penelitian ini bertujuan untuk mengetahui apakah terdapat perbedaan antara tingkat kesehatan bank konvensional dan bank syariah pada periode 2015-2019. Penelitian ini menggunakan metode CAMELS yang terdiri dari Capital, Asset, Management, Earnings, Liquidity dan Sensitivity to Market Risk agar mengetahui bagaimana kondisi kesehatan suatu bank tersebut. Pada aspek permodalan menggunakan rasio Capital Adequacy Ratio, Non Performing Loan mewakili aspek aset, Net Profit Margin mewakili aspek manajemen, Return On Assets, Return On Equity, Biaya Operasional dan Pendapatan Operasional mewakili aspek rentabilitas, Loan To Deposit Ratio mewakili aspek likuiditas dan Interest Expense Ratio mewakili aspek sensitivitas terhadap risiko pasar. Jenis penelitian yang digunakan adalah penelitian deskriptif kuantitatif dengan menggunakan perangkat lunak SPSS 16. Sumber data pada penelitian ini adalah data sekunder. Teknik pengambilan sampelnya menggunakan purposive sampling. Metode pengumpulan datanya adalah data sekunder. Data yang digunakan dalam penelitian ini merupakan data – data sekunder yang diperoleh melalui situs Bursa Efek Indonesia dan situs resmi setiap sampel bank yaitu berupa laporan keuangan perusahaan selama 5 tahun. Penelitian ini menggunakan uji normalitas dan uji beda atau analisis perbandingan Independent Sample T-test untuk analisis statistik dan uji hipotesis. Hasil analisis ini menemukan tidak terdapat perbedaan antara tingkat kesehatan bank konvensional dan syariah pada rasio Capital Adequacy Ratio, Loan To Deposit Ratio dan Interest Expense Ratio, namun terdapat perbedaan pada rasio Non Performing Loan, Net Profit Margin, Return On Assets, Return On Equity, dan Biaya Operasional dan Pendapatan Operasional. Maka dapat disimpulkan bahwa bank konvensional memiliki kondisi kesehatan yang lebih baik dibandingkan bank syariah selama periode 2015-2019.

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