DETERMINANTS OF BANK PROFITABILITY: A NEW EVIDENCE FROM STATE-OWNED BANKS IN INDONESIA
This paper investigates the factors that determine bank profitability in Indonesia particularly on state-owned banks during the 2007 to 2017. The research applied Vector Error Correction Model (VECM) to measure short-term and long-term effects of independent variable on dependent variable. The resea...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
Universitas Pasundan
2020-06-01
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| Series: | Trikonomika |
| Online Access: | https://journal.unpas.ac.id/index.php/trikonomika/article/view/1443 |
| _version_ | 1828764360704524288 |
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| author | Ovy Prasanto Dwi Wulandari Bagus Shandy Narmaditya Mahirah Kamaludin |
| author_facet | Ovy Prasanto Dwi Wulandari Bagus Shandy Narmaditya Mahirah Kamaludin |
| author_sort | Ovy Prasanto |
| collection | DOAJ |
| description | This paper investigates the factors that determine bank profitability in Indonesia particularly on state-owned banks during the 2007 to 2017. The research applied Vector Error Correction Model (VECM) to measure short-term and long-term effects of independent variable on dependent variable. The research data ini this paper is drawn from two main sources namely Bank Indonesia (BI) and Financial Services Authority (OJK) from 2007 to 2017. The findings showed that in the long term, BOPO, LDR, NPLs, economic growth, and exchange rates have positive relationship toward bank profitability while in the short term, inflation and BI rates do not have effect on bank profitability. However, in the short run, all variables mentioned do not have impact toward banking profitability. In addition, based on Impulse Response Function test, it showed that there are only two independent variables are able to provide a response in case of shock, namely inflation and the exchange rate toward bank’s profitability. |
| first_indexed | 2024-12-11T02:20:29Z |
| format | Article |
| id | doaj.art-f5bc6f626acb4512b1fd2a1e48a7aea4 |
| institution | Directory Open Access Journal |
| issn | 1411-514X 2355-7737 |
| language | English |
| last_indexed | 2024-12-11T02:20:29Z |
| publishDate | 2020-06-01 |
| publisher | Universitas Pasundan |
| record_format | Article |
| series | Trikonomika |
| spelling | doaj.art-f5bc6f626acb4512b1fd2a1e48a7aea42022-12-22T01:24:04ZengUniversitas PasundanTrikonomika1411-514X2355-77372020-06-01191293510.23969/trikonomika.v19i1.14431443DETERMINANTS OF BANK PROFITABILITY: A NEW EVIDENCE FROM STATE-OWNED BANKS IN INDONESIAOvy Prasanto0Dwi Wulandari1Bagus Shandy Narmaditya2Mahirah Kamaludin3Faculty of Economics, Universitas Negeri MalangUniversitas Negeri MalangFaculty of Economics, Universitas Negeri MalangSchool of Social and Economic Development, Universiti Malaysia TerengganuThis paper investigates the factors that determine bank profitability in Indonesia particularly on state-owned banks during the 2007 to 2017. The research applied Vector Error Correction Model (VECM) to measure short-term and long-term effects of independent variable on dependent variable. The research data ini this paper is drawn from two main sources namely Bank Indonesia (BI) and Financial Services Authority (OJK) from 2007 to 2017. The findings showed that in the long term, BOPO, LDR, NPLs, economic growth, and exchange rates have positive relationship toward bank profitability while in the short term, inflation and BI rates do not have effect on bank profitability. However, in the short run, all variables mentioned do not have impact toward banking profitability. In addition, based on Impulse Response Function test, it showed that there are only two independent variables are able to provide a response in case of shock, namely inflation and the exchange rate toward bank’s profitability.https://journal.unpas.ac.id/index.php/trikonomika/article/view/1443 |
| spellingShingle | Ovy Prasanto Dwi Wulandari Bagus Shandy Narmaditya Mahirah Kamaludin DETERMINANTS OF BANK PROFITABILITY: A NEW EVIDENCE FROM STATE-OWNED BANKS IN INDONESIA Trikonomika |
| title | DETERMINANTS OF BANK PROFITABILITY: A NEW EVIDENCE FROM STATE-OWNED BANKS IN INDONESIA |
| title_full | DETERMINANTS OF BANK PROFITABILITY: A NEW EVIDENCE FROM STATE-OWNED BANKS IN INDONESIA |
| title_fullStr | DETERMINANTS OF BANK PROFITABILITY: A NEW EVIDENCE FROM STATE-OWNED BANKS IN INDONESIA |
| title_full_unstemmed | DETERMINANTS OF BANK PROFITABILITY: A NEW EVIDENCE FROM STATE-OWNED BANKS IN INDONESIA |
| title_short | DETERMINANTS OF BANK PROFITABILITY: A NEW EVIDENCE FROM STATE-OWNED BANKS IN INDONESIA |
| title_sort | determinants of bank profitability a new evidence from state owned banks in indonesia |
| url | https://journal.unpas.ac.id/index.php/trikonomika/article/view/1443 |
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