scholarly journals The Impact of Financial Ratios, Operational Efficiency and Non-Performing Loan Towards Commercial Bank Profitability

2016 ◽  
Vol 1 (1) ◽  
pp. 43-50
Author(s):  
Fiola Christaria ◽  
Ratnawati Kurnia
Keyword(s):  
Banking Sector ◽  
Operational Efficiency ◽  
Capital Adequacy ◽  
Public Confidence ◽  
Return On Assets ◽  
Bank Profitability ◽  
Operating Income ◽  
Capital Adequacy Ratio ◽  
Income Ratio ◽  
The Impact

Objective - The objective of this paper is to determine the impact of Capital Adequacy Ratio (CAR), Loan to Deposit Ratio (LDR), Operational Efficiency proxies by Operational Expense to Operating Income Ratio (BOPO)and Non-Performing Loan (NPL) towards bank profitability proxies by Return on Assets (ROA). Methodology/Technique - Purpose samplingis applied to gather samples of the banking sector that was listed on the Indonesia Stock Exchange for the period of 2012 - 2014. Multiple regression analysis was used to analyse data. Findings - The F test result shows that CAR, LDR, BOPO, and NPL simultaneously, have a significant impact towards ROA. This means that the model can be used to predict bank profitability. It is also deduced that Operational Efficiency proxies by Operational Expense to Operating Income Ratio has a significant impact towards banking profitability. Novelty - This paper suggests that banks perform lending selectively and banks maintain the level of non-performing loans to be low in order to manage the risks and to improve their profitability as a means of increasing public confidence level. Type of Paper Empirical Keywords: Capital Adequacy Ratio; Loan to Deposit Ratio; Non-performing Loan; Operating Expense to Operating Income; Return on Assets. JEL Classification: D81, G21.

Moderasi NPF terhadap Intervensi BOPO dan CAR pada Kinerja Keuangan Bank Syariah di Indnesia 2019-2021

2021 ◽  
Vol 4 (2) ◽  
pp. 328-344
Author(s):  
Toha Barizi ◽  
Rifky Fatoni ◽  
Zuni Fitrowati ◽  
Umrotul Khasanah
Keyword(s):  
Financial Services ◽  
Time Series Data ◽  
Secondary Data ◽  
Capital Adequacy ◽  
Series Data ◽  
Return On Assets ◽  
Operating Income ◽  
Capital Adequacy Ratio ◽  
Considerable Impact ◽  
The Impact

The goal of this research is to look into the impact of Operating Costs on Operating Income (BOPO) and Capital Adequacy Ratio (CAR) on the Financial Performance of Islamic Commercial Banks, which is measured using one of the profitability ratio indicators, Return on Assets (ROA). This study employs a quantitative approach by employing explanatory research, which tries to examine the theories and hypotheses that exist in this study in order to determine whether they strengthen or weaken earlier theories and hypotheses. The study relied on secondary data, specifically information gathered from the ojk.ac.id website. This research uses monthly time series data from the Financial Services Authority from 2019 to 2021, with a sample size of 26 months. Multiple linear regression and moderated regression analysis were employed in this study's regression model (MRA). The findings of this study revealed that BOPO had a considerable impact on ROA, although CAR had no such impact, and that NPF, as a moderating variable, was able to moderate the impact of BOPO and CAR on ROA.

scholarly journals Credit Risk and Profitability of Banking Sector in Sri Lanka

2021 ◽  
Vol 3 (1) ◽  
pp. 65-71
Author(s):  
Herath Mudiyanselage Kasun Salitha Bandara ◽  
Ahamed Lebbe Mohamed Jameel ◽  
Haleem Athambawa
Keyword(s):  
Sri Lanka ◽  
Credit Risk ◽  
Banking Sector ◽  
Capital Adequacy ◽  
Sri Lankan ◽  
Return On Assets ◽  
Net Charge ◽  
Panel Data Regression ◽  
Capital Adequacy Ratio ◽  
The Impact

This paper aims to investigate the impact of credit risk on the profitability of the banking sector in Sri Lanka. The profitability is measured with and Return on Assets. At the same time, credit risk is quantified with four indicators: Non-performing loan Ratio (NPLR), Loan to Deposit Ratio (LDR), Net Charge off Ratio (NCOR), and Capital Adequacy Ratio (CAR). Data from thirteen banks over eight years from 2010 to 2017 was analyzed using panel data regression analysis. The finding shows that the Profitability of the Banking Sector in Sri Lanka has been determined by important determinants such as credit risk. The study further finds that non-performing loans have negative and significant return on assets. However, the net charge-off ratio and the loan to deposit ratio are not important variables for expanding the bank's profitability. On the other hand, the CAR positively impacts returns on assets. The study suggested the need to strengthen the management of credit risk in order to preserve Sri Lankan banks' current profitability.

scholarly journals Determinants of Bank Profitability of Indonesian Banks Based on Core Capital Size in Category 3 and 4

2020 ◽  
Vol 3 (1) ◽  
pp. 100-119
Author(s):  
Karen Santoso ◽  
◽  
Weindytha Patrizia Wibowo ◽  
Sammy Kristamuljana ◽  
Rathria Arrina Rachman ◽  
...  
Keyword(s):  
Banking Sector ◽  
Stock Exchange ◽  
Capital Adequacy ◽  
Factors Affecting ◽  
Operating Income ◽  
The Core ◽  
Net Interest Margin ◽  
Capital Adequacy Ratio ◽  
Income Ratio ◽  
Negative Relationships

Indonesian banks are categorized into four classes based on core capital size that determines the scope of banks’ business activities. This research aimed to identify the determinants of profitability of banks with the core capital size of IDR 5-30 trillion (called “Buku 3” category) and banks with the core capital size of more than IDR 30 trillion (called “Buku 4” category). The data sample was 27 conventional commercial banks listed on the Indonesia Stock Exchange (BEI) from 2009 to 2018. These banks are divided into three different sample classes namely Buku 3 only, Buku 4 only, and Buku 3 and Buku 4 categories. By applying a panel regression model, the results showed that net interest margin (NIM) positively affected profitability of the banks in Buku 3, banks in Buku 4, as well as banks in Buku 3 and Buku 4 category. Moreover, operating expense to operating income ratio (BOPO) and non-performing loans (NPL) negatively affected profitability of those banks in the three sample classes. However, loan to deposit ratio (LDR) and capital adequacy ratio (CAR) have negative relationships with profitability for banks in the Buku 4 category only. Accordingly, this study finds that banks in different sizes of core capital categories have different factors affecting profitability in the Indonesian banking sector.

scholarly journals The Impact of Capital Adequacy Ratio (CAR) on Islamic Banks’ Performance in Selected MENA Countries

2021 ◽  
pp. 116-133
Author(s):  
ADEL Z. A. ALNAJJAR ◽  
Anwar Hasan Abdullah Othman
Keyword(s):  
United Arab Emirates ◽  
Commercial Banks ◽  
Banking Sector ◽  
Capital Adequacy ◽  
Islamic Banks ◽  
Return On Assets ◽  
Return On Equity ◽  
Mena Countries ◽  
Capital Adequacy Ratio ◽  
The Impact

A strong capital adequacy ratio is crucial to a financial institution's success and helps it to survive any potential financial crisis. From Q1 2017 to Q4 2019, the influence of the Capital Adequacy Ratio (CAR) on the performance of Commercial Islamic Banks in MENA nations (Qatar, Oman, Bahrain, Kuwait, United Arab Emirates, Saudi Arabia, and Jordan) is examined. The performance measures utilized in this study are Return on Assets (ROA) and Return on Equity (ROE). The study's sample frame comprises all Islamic commercial banks in the designated MENA nations, with a sample size of 18 Islamic commercial banks. Panel data, fixed and random models, are applied in this study since there are multiple entities and time series. The findings of the study showed that the selected Islamic banks are committed to Capital Adequacy Ratio (CAR) which is defined under Basel III. This is considered the largest percentage regulated by the Basel Committee. The study also found that there is a statistically negative significant influence of CAR on both performance indicators ROE and ROA in the commercial Islamic banks in the selected MENA countries. The results of the study can be useful to a policymaker or decision-makers in the Islamic Banks industry. First, the research could be a reference to financial regulators such as central banks which may use the findings to provide regulation on optimal capital levels for local banks in terms of regulations, deregulations, and financial disruption. Next, the practice implications in the Islamic banking sector will provide them with insight as to how a bank’s capital influences its earnings. Hence, management can work towards attaining an optimal structure that maximizes their performance as well as identifying “best” and “worst” practices associated with capitalization levels.

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 Kecukupan Modal, Pembiayaan Bermasalah, dan Efisiensi Operasional Sebagai Determinan dari Profitabilitas Bank Muamalat Indonesia Periode 2012-2017

2019 ◽  
Vol 19 (2) ◽  
pp. 131-148
Author(s):  
Yoni Elmadwita ◽  
Novi Mubyarto
Keyword(s):  
Operational Efficiency ◽  
Capital Adequacy ◽  
Research Subjects ◽  
Return On Assets ◽  
Financial Reports ◽  
Operating Income ◽  
Capital Adequacy Ratio ◽  
Financing Risk ◽  
Descriptive Approach ◽  
Quantitative Descriptive

This research aims to analyze the effect of capital adequacy, financing risk, and operational efficiency on the profitability of Bank Muamalat Indonesia. This research uses a quantitative descriptive approach, the object of research is the Capital Adequacy Ratio (CAR / KPMM) as a proxy for capital adequacy, Non-Performing Financing (NPF) as a proxy for financing risk, Operational Costs Operating Income (BOPO / REO) as a proxy for operational efficiency, and Return on Assets (ROA) as a proxy for profitability. The research subjects are the annual and quarterly financial reports of PT. Bank Muamalat Indonesia for the period 2012 - 2017. Methods of data analysis using multiple linear regression. The results showed that CAR had no significant effect on ROA. Meanwhile, NPF and BOPO have a negative and significant effect on ROA. Penelitian ini bertujuan untuk menganalisis pengaruh kecukupan modal, pembiayaan bermasalah, dan efisiensi operasional terhadap profitabilitas Bank Muamalat Indonesia. Penelitian menggunakan pendekatan deskriptif kuantitatif, Objek penelitian adalah Capital Adequacy Ratio (CAR/KPMM) sebagai proksi dari kecukupan modal, Non-Performing Financing (NPF) sebagai proksi dari pembiayaan bermasalah, Biaya Operasional Pendapatan Operasional (BOPO/REO) sebagai proksi dari efisiensi operasional dan Return on Asset (ROA) sebagai proksi dari profitabilitas. Subjek penelitian adalah laporan keuangan tahunan (Annual Report) dan triwulanan PT. Bank Muamalat Indonesia periode 2012 – 2017. Metode analisis data menggunakan regresi linier berganda. Hasil penelitian diketahui bahwa CAR tidak berpengaruh signifikan terhadap ROA. Sementara itu, NPF dan BOPO mempunyai pengaruh negatif dan signifikan terhadap ROA.

scholarly journals Determinan Nilai Perusahaan dengan Kepemilikan Institusional Sebagai Variabel Moderating

2021 ◽  
Vol 22 (1) ◽  
pp. 103-110
Author(s):  
Baihaqi Ammy ◽  
◽  
Puja Rizqy Ramadhan ◽  
Keyword(s):  
Banking Sector ◽  
Stock Exchange ◽  
Institutional Ownership ◽  
Capital Adequacy ◽  
Operating Costs ◽  
Primary Data ◽  
Return On Assets ◽  
Operating Income ◽  
Insignificant Effect ◽  
Capital Adequacy Ratio

This research aims in general to produce a determinant model of corporate value with institutional ownership as a moderating variable in banking companies listed on the Indonesia Stock Exchange. The sample in this study is all public banking sector companies listed on the Indonesia Stock Exchange (IDX) which number 43 companies The type of data used in this study is using primary data. The results showed that variable returns on assets had a positive but insignificant effect on the company's value variables. Non-performing loan variables negatively and significantly affect the company's value variables. Variable capital adequacy ratio has a positive and significant effect on the variable value of the company. Variable loan to deposit ratio negatively and insignificant to the variable value of the company. Variable operating costs to operating income have a positive but insignificant effect on the company's value variables. Institutional ownership variables are unable to moderate the effect of variable return on assets, non performing loans, capital adequacy ratios, loan to deposit ratios and operating costs on operating income against the company's value.

scholarly journals Moderating Effect of Inflation on the Influence of Financial Performance on the Growth of Islamic Banking in Indonesia

2021 ◽  
Vol 1 (2) ◽  
pp. 124-143
Author(s):  
Abid Djazuli ◽  
Mister Candera
Keyword(s):  
Financial Performance ◽  
Secondary Data ◽  
Capital Adequacy ◽  
Islamic Banking ◽  
Return On Assets ◽  
Financial Reports ◽  
Operating Income ◽  
Capital Adequacy Ratio ◽  
Operating Margin ◽  
The Impact

Islamic banking is one of the financial institutions whose activities are financial intermediation between the owners of capital and those who need capital. This study was conducted to know and analyze the impact of inflation as a moderating influence of financial performance on the growth of Islamic banking in Indonesia. The financial performance used consists of return on assets (ROA), non-performing financing (NPF), net operating margin (NOM), capital adequacy ratio (CAR), financing to Deposit Ratio (FDR), and operating expenses for operating income (BOPO). The data used is secondary data, obtained from the results of financial reports published on the official website of the Otoritas Jasa Keuangan (OJK) from January 2015 to December 2019. The analysis results show that, in general, inflation cannot moderate the influence of financial performance on rbanking growth—Sharia in Indonesia. Inflation can only be a predictor of the effect of return On Assets and net operating margin on the growth of Islamic banking in Indonesia. Meanwhile, the variables of non-performing financing (NPF), capital adequacy ratio (CAR), financing to deposit ratio (FDR), and operating expenses for operating income (BOPO) are not able to be a moderator or as a predictor

PENGARUH CAPITAL ADEQUACY RATIO (CAR), LOAN DEPOSIT RATIO (LDR), OPERATING EXPENSES TO OPERATING INCOME RATIO, DAN NON PERFORMING LOAN (NPL) TERHADAP RETURN ON ASSET (ROA) PADA BANK PERKREDITAN RAKYAT (STUDI KASUS PADA BPR DI KABUPATEN KARAWANG PERIODE 2012-2016)

BUANA ILMU ◽  
2018 ◽  
Vol 2 (1) ◽  
Author(s):  
Danang Dwi Hardi Wibowo
Keyword(s):  
Capital Adequacy ◽  
Return On Assets ◽  
Operating Income ◽  
Capital Adequacy Ratio ◽  
Income Ratio

ABSTRAK Penelitian ini dilakukan untuk menguji pengaruh Capital Adequacy Ratio (CAR), Loan to Deposit Ratio (LDR), Operating Expenses To Operating Income dan Non Performing Loan (NPL) terhadap Return On Assets (ROA) sehingga memperoleh bukti-bukti empirik dan menemukan kejelasan fenomena-fenomena serta kesimpulan tentang pengaruh Capital Adequacy Ratio (CAR), Loan to Deposit Ratio (LDR), Operating Expenses To Operating Income dan Non Performing Loan (NPL) terhadap Return On Assets (ROA) pada Bank Perkreditan Rakyat di Kabupaten Karawang yang trdaftar di Otoritas Jasa Keuangan Jumlah sampel yang diambil sebanyak 11 Bank Perkreditan Rakyat di Kabupaten Karawang periode tahun 2012 sampai dengan 2016. Teknik analisis data yang digunakan adalah regresi linier berganda Dari hasil analisis data penelitian diperoleh beberapa kesimpulan sebagai berikut: variabel Capital Adequacy Ratio memiliki pengaruh positif dan signifikan terhadap Return on Assets. Variabel LDR memiliki pengaruh negatif terhadap ROA serta tidak signifikan. Sedangkan variable Operating Expenses To Operating Income dan Non Performing Loan (NPL) berpengaruh negatif dan signifikan terhadap Return on Asset (ROA). Kemampuan prediksi dari keempat variabel tersebut terhadap Return on Asset (ROA) dalam penelitian ini sebesar 51,3%, sedangkan sisanya sebesar 48,7%, dipengarui oleh faktor lain yang tidak dimasukkan ke dalam model penelitian. Kata kunci: Capital Adequacy Ratio (CAR), Loan to Deposit Ratio (LDR), (BOPO), Non Performing Loan (NPL) dan Return On Assets (ROA).

scholarly journals ANALISIS RASIO KEUANGAN PERBANKAN TERHADAP KINERJA KEUANGAN DENGAN SUKU BUNGA SEBAGAI MODERASI

2019 ◽  
Vol 2 (2) ◽  
pp. 401
Author(s):  
Alfred Kristanto
Keyword(s):  
Stock Return ◽  
Banking Sector ◽  
Stock Exchange ◽  
Economic Value ◽  
Value Added ◽  
Capital Adequacy ◽  
Economic Value Added ◽  
Return On Assets ◽  
Operating Income ◽  
Capital Adequacy Ratio

This study to analyze the effect of loan to deposit ratio, operational income operational expense, economic value added, return on asset, and capital adequacy ratio to stock return with interest rate of bank Indonesia as a moderation variable. Population used in this research is listed banking sector issuer in Indonesia Stock Exchange year 2012-2016. Data processing using SPSS version 24.0 testing using moderated regression analysis. Result on the research showed loan to deposit ratio, operational income operational expense, and capital adequacy ratio influence on stock return. Meanwhile, economic value added and return on assets not have influence on stock return. Simultaneously loan to deposit ratio, operational expense of operating income, economic value added, return on asset, and capital adequacy ratio have an effect on stock return.

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