scholarly journals Analysis of the Health Level of Rural Banks Based on the Risk Base Bank Rating Method in Gianyar Regency

2021 ◽  
pp. 72-81
Author(s):  
Ni Made Taman Sari ◽  
Ni Made Santini ◽  
Made Pratiwi Dewi
Keyword(s):  
Internal Audit ◽  
Financial Statements ◽  
Capital Adequacy ◽  
External Auditors ◽  
The Public ◽  
Minimum Capital ◽  
Good Corporate Governance ◽  
Capital Adequacy Ratio ◽  
Risk Approach ◽  
Rating Method

The health of a bank is in the interest of all related parties, including bank owners and managers, the public using bank services, and bank supervisors. Bank Indonesia assesses the soundness of banks using a method with a risk approach called the Risk Based Bank Rating (RBBR). This study aims to determine the soundness of Rural Banks (BPR) in Gianyar Regency in 2015-2020 using the RBBR method. This method consists of four assessment factors, namely risk profile, GCG, earnings and capital. The results of the study show that there are still several BPRs in Gianyar Regency that have the predicate of being unhealthy or violating the NPL, LDR and ROA ratios in accordance with the provisions of the law. The assessment of the Good Corporate Governance (GCG) factor in this study focused on the compliance function with the implementation of internal audit and external audit on financial statements implemented by banks. The internal audit function has been implemented by banks from 2015 to 2020. External audits were implemented by banks in 2019 and 2020. In 2019, 19 or 76 percent of 25 banks were audited by external auditors, and 6 banks or 24 percent were not audited by external auditors. The results of the Assessment of Capital Ratio with Minimum Capital Adequacy Ratio (KPMM), all BPRs with Very Healthy Predicate with KPMM Ratio greater than 12 percent. In 2019, 19 or 76 percent of 25 banks were audited by external auditors, and 6 banks or 24 percent were not audited by external auditors. The results of the Assessment of Capital Ratio with Minimum Capital Adequacy Ratio (KPMM), all BPRs with Very Healthy Predicate with KPMM Ratio greater than 12 percent. In 2019, 19 or 76 percent of 25 banks were audited by external auditors, and 6 banks or 24 percent were not audited by external auditors. The results of the Assessment of Capital Ratio with Minimum Capital Adequacy Requirement (KPMM), all BPR with Very Healthy Predicate with KPMM Ratio greater than 12 percent.

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

Implications of the Audit Oversight Board: External Auditors’ Perspective

2015 ◽  
Vol 2 (3) ◽  
pp. 1-4
Author(s):  
Mazlina Mustapha ◽  
Foong Sook Hwa
Keyword(s):  
Internal Audit ◽  
Financial Statements ◽  
Internal Auditors ◽  
Face To Face ◽  
External Auditors ◽  
The Public ◽  
Training Costs ◽  
Audit Firms ◽  
And Training

The purpose of Audit Oversight Board (AOB) is to oversee the external auditors who audit the listed companies. Its establishment is expected to improve the quality of the audited financial statements and to increase the confidence of the public on the quality of the services provided by the auditors. This study explores how the establishment of audit oversight board affects the auditors in Malaysia. As the study is exploratory in nature with limited studies being carried out on AOB, face-to-face interviews were conducted with the external auditors. The findings show that the establishment of AOB affects the job of external auditors, especially on the documentation and training costs, which vary across audit firms of different sizes. There are opinions that the increased pressure on the external auditors is not solely due to the establishment of AOB, but it is also due to the revised accounting standards and other regulations. The study also finds that the external auditors’ reliance on the internal auditors is not affected by the establishment of AOB. In addition, regardless of whether the internal audit department is in-house or outsourced, it will not affect the reliance of external auditors on the internal auditors work.

scholarly journals Bank Failure Prediction Model Based on Governance: A Case of Rural Banks in Indonesia

2019 ◽  
Vol 15 (10) ◽  
pp. 49
Author(s):  
Suwandi Suwandi ◽  
Noer Azam Achsani ◽  
Dedi Budiman Hakim ◽  
Halim Alamsyah
Keyword(s):  
Corporate Governance ◽  
Logistic Regression ◽  
Board Of Directors ◽  
Deposit Insurance ◽  
Bank Failure ◽  
Capital Adequacy ◽  
Minimum Capital ◽  
Good Corporate Governance ◽  
Compliance Level ◽  
Capital Adequacy Ratio

Since it was first operating in 2005 until 2017, Indonesia Deposit Insurance Corporation (IDIC) has liquidated 91 rural banks which were determined as failed banks by supervision authority. The cause of the failing of the bank is mainly due to the incapability of the bank to meet the minimum Capital Adequacy Ratio (CAR). Bank’s capital was shrunk by the loss caused by fraud. The fraud is mostly induced by the lack of good corporate governance implementation. By using the logistic regression, it can be concluded that (1) the incomplete of responsibility letter which will be used in the event of bank failure, submitted by the bank commissioners; (2) the incomplete of responsibility letter which will be used in the event of bank failure, submitted by the bank directors; (3) role duplication between shareholders and board of directors; and (4) bank had classified as special supervision, have impact on the increase of rural banks failure. At the same time, the compliance level of rural banks to a correct premium payment has impacted to decrease of rural banks failure possibilities.

scholarly journals Kegagalan Analisis Laporan Keuangan Dalam Memprediksi Kebangkrutan BPR/BPRS di Indonesia

2020 ◽  
Vol 3 (3) ◽  
pp. 161-181
Author(s):  
Suwandi - Miskak
Keyword(s):  
Research Result ◽  
Financial Statements ◽  
Capital Adequacy ◽  
Minimum Capital ◽  
Data Prediction ◽  
Capital Adequacy Ratio ◽  
The Difference

Since LPS operated in 2005 until 2017, LPS has liquidated 84 BPR/BPRS which were declared as failed banks by BI/OJK. The cause of the failure of the BPR/BPRS is that the bank cannot meet the minimum capital adequacy ratio (CAR) due to losses suffered by the bank. The bank losses are caused fraud by owner, management and employees. Losses are recognized in the financial statements after it found by BI/OJK. We forecast quarterly CAR data before a BPR/BPRS is determined as a bank under special supervision to determine the ability of CAR data prediction whether the bank will be placed as a bank under special supervision using ARIMA. The research result shows the difference between forecasting CAR and actual CAR is significant. This means that CAR data calculated based on financial statements cannot predict the BPR/BPRS will be determined as a bank under special supervision, which in turn has the potential to become a failed bank.

scholarly journals ANALISIS TINGKAT KESEHATAN BANK DENGAN MENGGUNAKAN METODE RISK-BASED BANK RATING (RBBR) (STUDI PADA BANK YANG TERDAFTAR DI BANK INDONESIA DALAM LAPORAN TRIWULANAN PERBANKAN TAHUN 2015)

2020 ◽  
Vol 7 (1) ◽  
pp. 14
Author(s):  
Bayu Rezaldi ◽  
Aftoni Sutanto
Keyword(s):  
Corporate Governance ◽  
Positive Result ◽  
Risk Profile ◽  
Capital Adequacy ◽  
Ratio Analysis ◽  
Good Corporate Governance ◽  
Net Interest Margin ◽  
Capital Adequacy Ratio ◽  
Rating Method ◽  
Interest Margin

The research objective is to understand bank’s health rate that are listed in Bank Indonesia in banking sub-sector period 2015. Bank’s health rate is assessed through Risk-Based Bank Rating method which includes four factors such as risk profile, Good Corporate Governance,, earning and capital of each bank. This research only considers three factors of four total factors Risk Profile is proxied by Loan to Deposit Ratio(LDR), Earning is proxied by Return On Asset (ROA) to Net Interest Margin (NIM), Capital is proxied by Capital Adequacy Ratio (CAR). The assessment of bank’s health rate based on Risk Profile with Loan to Deposit Ratio analysis has shown that some bank area not heahlty with Loan to Deposit Ratio below 85% , the assessment based on earning with Return On Asset analysis has shown that some banks are not healthy with Return On Asset below 1.25 %. The assessment with Net Interest Margin has shown that some bank are not healthy with Net Interest Margin below 2%. The assessment based on capital by Capital Adequacy Ratio shows positive result for each bank. In general, each bank has Capital Adequacy Ratio aboved 10 %. Considering these results, each bank in healthy category.

scholarly journals PENGARUH PENILAIAN KESEHATAN BANK TERHADAP KINERJA KEUANGAN BANK SYARIAH DI INDONESIA

2018 ◽  
Vol 3 (2) ◽  
pp. 409
Author(s):  
Welly Welly ◽  
Kurnia Krisna Hari
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Commercial Banks ◽  
Financial Statements ◽  
Capital Adequacy ◽  
Islamic Banks ◽  
Good Corporate Governance ◽  
Capital Adequacy Ratio ◽  
Operating Margin ◽  
Bank Soundness

This study aims to provide empirical evidence about the effect of bank soundness by using Risk Profile, Good Corporate Governance, Earnings, Capital (RGEC) methods on the financial performance of sharia commercial banks in Indonesia. The formulation of the problem in this research is whether there is an effect of the soundness of the Islamic Commercial Bank with the RGEC method with the banking performance in Indonesia in the 2011-2015 period? How much influence does the bank's health level have on the RGEC method on the performance of Islamic Banks in Indonesia? The research sample consisted of 7 Islamic banks in Indonesia. The data used are quarterly financial statements of sharia commercial banks and GCG implementation reports. The statistical method used to test the research hypothesis is multiple linear regression. The results of data testing stated that there was no heterocedasticity, autocorrelation, multicollinearity, and data with normal distribution. The results showed that Non Performing Financing (NPF), Financing to Deposit Ratio (FDR), Net Operating Margin (NOM) and Capital Adequacy Ratio (CAR) had an influence on the financial performance of Islamic commercial banks, while Good Corporate Governance (GCG) did not have influence on the financial performance of Islamic commercial banks. The effect of bank soundness on the financial performance of Islamic banks was 39.40%, while 60.60% was influenced by other factors outside this study.

scholarly journals ANALISIS PERINGATAN DINI KEBANGKRUTAN BANK UMUM SYARIAH DI INDONESIA PERIODE 2011 – 2015

AKUNTABILITAS ◽  
2019 ◽  
Vol 11 (1) ◽  
pp. 39-58
Author(s):  
Kurnia Krisna Hari ◽  
Sa’adah Siddik ◽  
Didik Susetyo
Keyword(s):  
Corporate Governance ◽  
Early Warning ◽  
Financial Statements ◽  
Capital Adequacy ◽  
Islamic Banking ◽  
Return On Assets ◽  
Policy Theory ◽  
Good Corporate Governance ◽  
Capital Adequacy Ratio ◽  
Operating Margin

This study aims to give empirical prove on the factors that affecting early warning bankruptcyof Islamic banking in Indonesia using RGEC method. The factors that are tested in this study are Non Performing Financing (NPF), Financing to Deposit Ratio (FDR), Good Corporate Governance (GCG), Return on Assets (ROA), Net Operating Margin (NOM), and Capital Adequacy Ratio (CAR). The sample of this study consists of 7 Islamic banking in Indonesia. The data used is the quartile report of financial statements and the GCG report while the statistical method used is panel regression.The result shows that Non Performing Financing (NPF), Financing to Deposit Ratio (FDR), Return On Assets (ROA), and Capital Adequacy Ratio (CAR) gives impact to the early warning bankruptcy of the Islamic banking, while Good Corporate Governance (GCG) and Net Operating Margin (NOM) does not have any effect on the early warning bankruptcy. This implies that GCG and NOM are not inline with the policy, theory and previous studies. 

scholarly journals The effect of risk management on financial performance with good corporate governance as a moderation variable

2018 ◽  
pp. 308
Author(s):  
Mardiana Mardiana
Keyword(s):  
Risk Management ◽  
Financial Performance ◽  
Stock Exchange ◽  
Financial Statements ◽  
Capital Adequacy ◽  
Operating Efficiency ◽  
Islamic Banking ◽  
Return On Assets ◽  
Good Corporate Governance ◽  
Capital Adequacy Ratio

<p>This study aims to examine the effect of risk management proxied by the Capital Adequacy Ratio (CAR), Operating Efficiency (BOPO), and Non Performing Loan (NPL), to the financial performance projected with Return on Assets (ROA) in Islamic Banking Companies listed on the Indonesia Stock Exchange (BEI) in the period 2011 to 2016. The data used is obtained from the Financial Statements of Sharia Banking Companies Listed on Indonesia Stock Exchange in the period 2011 to 2016. After passing through the stage of purposive sampling, the worthy of used sample is 5 Companies. The results showed that the variable of Capital Adequacy Ratio (CAR), and Non Performing Loan (NPL) had negative and insignificant effect on Return on Asset (ROA), and Operating Efficiency (BOPO) had negative and significant effect on Return on Assets (ROA). Thus, the bank (issuer) is expected to pay more attention to the level of operating efficiency to improve the profitability of the company's financial performance. Meanwhile, the variable Capital Adequacy Ratio (CAR) and Non Performing Loan (NPL) did not significantly affect the Return on Asset (ROA) of the company because during the study period, the bank intermediation function was not as expected.</p>

scholarly journals Pengaruh Komponen Risk-Based Bank Rating Terhadap Profitabilitas Bank Umum Syariah Di Indonesia (Periode 2011–2014)

2017 ◽  
Vol 3 (3) ◽  
pp. 173
Author(s):  
Bunga Aprigati Iskandar ◽  
Nisful Laila
Keyword(s):  
Corporate Governance ◽  
Risk Profile ◽  
Capital Adequacy ◽  
Islamic Banks ◽  
Efficiency Ratio ◽  
Return On Assets ◽  
Analysis Techniques ◽  
Good Corporate Governance ◽  
Capital Adequacy Ratio ◽  
Rating Method

This research aimed to know and analyze the influence of components of Risk based bank rating method (risk profile, Good Corporate Governance, earnings, and capital) to profitability of Islamic Bank in Indonesia, measured by Return On Assets (ROA). Whereas the ratio used in this research to represent the components of RGEC are risk profile measured by Non Performing Financing (NPF) and Financing to Deposit Ratio (FDR), implementation of GCG by composite score of GCG, earnings by Operational Efficiency Ratio (OER), and capital by Capital Adequacy Ratio (CAR). Sample of this research are 11 Islamic Banks in Indonesia from 2011 to 2014. The analysis techniques used is multiple linear regression. Based on the analysis result, it can be concluded that NPF, FDR, GCG, OER, and CAR had simultaneous significant effect to ROA. Partially, NPF, FDR, and BOPO have significant effect to ROA. However, CAR and GCG don’t affect ROA significantly.

scholarly journals ANALISIS PERBANDINGAN KINERJA KEUANGAN BANK MUAMALAT INDONESIA DAN BANK SYARIAH MANDIRI

2013 ◽  
Vol 3 (1) ◽  
pp. 74
Author(s):  
Ema Dwi Suryani ◽  
Dyah Fitriani
Keyword(s):  
Financial Performance ◽  
Secondary Data ◽  
Financial Statements ◽  
T Test ◽  
Capital Adequacy ◽  
Minimum Capital ◽  
Capital Adequacy Ratio ◽  
Data Source ◽  
Asset Quality ◽  
Profitability Ratios

The purpose of this study was to assets the financial performance of Bank Muamalat Indonesia in 2010-2014, assets the financial performance of Bank Syariah Mandiri in 2010-2014, to know is there any difference in the performance of Bank Muamalat Indonesia and Bank Syariah Mandiri in 2010-2014. This data source which used are secondary data in the form of financial statements of the company obtained from the publication of Bank Indonesia. Data analysis was performed using analysis of financial ratios of capital adequacy ratio, asset quality ratios, profitability ratios and liquidity ratios. The method used to compare the performance of Bank Muamalat Indonesia with Bank Syariah Mandiri is using the test independent sample t test. Based on the calculation of independent sample t test showed that for each ratio is the ratio Provision of Minimum Capital Adequacy Ratio (CAR), the ratio of asset quality (KAP), the ratio of Net Operational Margin (NOM) and the ratio of Short Term Mismatch (STM) there was no difference in financial performance significantly between Bank Muamalat.

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