This research aims to examine the implementation of Good Corporate Governance (GCG) and its impact on the financial performance of Islamic banks, with a focus on PT. Bank Pembiayaan Rakyat Syariah (BPRS) Bakti Makmur Indah Sidoarjo during the period of 2021-2023. The method employed in this research is a qualitative descriptive approach, which involves data collection through literature review and documentation related to the implementation of GCG at BPRS Bakti Makmur Indah, as well as the analysis of the bank's financial reports for the specified period. The research findings indicate that BPRS Bakti Makmur Indah has implemented the principles of GCG, such as transparency, accountability, responsibility, professionalism, and fairness. However, the financial performance of the bank experienced a significant decline from 2021 to 2023. This decline is evident from the decrease in the values of Return on Assets (ROA), Return on Equity (ROE), and Net Profit Margin (NPM). These findings suggest that although the principles of GCG have been implemented, their effectiveness is not yet optimal, and there are still challenges to be overcome to improve the financial performance of the bank.
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