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Journal : IIJSE

Factors That Influence the Level of Banking Profitability in Indonesia Erliana Aditya; Karin Resnik; Susy Muchtar
Indonesian Interdisciplinary Journal of Sharia Economics (IIJSE) Vol 8 No 1 (2025): Sharia Economics
Publisher : Universitas KH. Abdul Chalim Mojokerto

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.31538/iijse.v8i3.6212

Abstract

This study aims to analyze the level of banking profitability in Indonesia using panel data analysis. Profitability is an important indicator reflecting a bank's financial health and is crucial in determining its sustainability and competitive advantage in the sector. This study examines the factors influencing the level of bank profitability in Indonesia. The sample used in this study was 40 conventional banks listed on the Indonesia Stock Exchange for five years (2019-2023). The sampling technique used was purposive sampling, and the analysis method used in this study was panel data regression. The independent variables in this study consisted of liquidity, capital adequacy, bank size, inflation, and bank income, while the dependent variable in this study was the return on assets. The results of the panel data regression in this study indicate that liquidity and bank size have a significant positive effect on the return on assets. Capital adequacy, inflation, and bank income do not affect the return on assets. The results of this study are expected to serve as a reference for conventional banks in increasing bank profitability by improving capital management efficiency, strengthening liquidity, and expanding the asset base. The results of this study are also expected to serve as a reference for investors in selecting banks with high liquidity and large size as indicators of better profit potential.
The Influence of Corporate Governance Mechanisms on the Performance of Commercial Banks in Indonesia Desi Natalia Lumbantoruan; Cantika Nasywa Suryatna; Susy Muchtar
Indonesian Interdisciplinary Journal of Sharia Economics (IIJSE) Vol 8 No 2 (2025): Sharia Economics
Publisher : Universitas KH. Abdul Chalim Mojokerto

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.31538/iijse.v8i2.6221

Abstract

The banking sector has an important role in supporting sustainable economic growth in Indonesia. However, global economic uncertainty and changes in monetary policy require improved corporate governance mechanisms to maintain financial stability and performance. This study aims to analyze the influence of corporate governance mechanisms, which include Board Size, Board Independence, Capital Adequacy Ratio (CAR), and Firm Sizeon the performance of commercial banks in Indonesia, which is proxied by Earnings Per Share (EPS). This study uses a panel data regression method with a sample of commercial banks listed on the Indonesia Stock Exchange (IDX) from 2019-2023. Secondary data was obtained from financial reports and official publications. The study results showed no influence of Board Size, Board Independence, Capital Adequacy Ratio, and Firm Size towards increasing EPS. This study is expected to contribute to understanding the factors that influence bank performance in Indonesia and become a reference for regulators and bank management to improve sustainable corporate governance.