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Financial efficiency performance of regional development bank (RDB) to support regional economy in Indonesia

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  • Yudistira Hendra Permana
  • Ike Yuli Andjani

Abstract

Regional development bank (RDB) in Indonesia is financial institution in purpose to strengthen regional economy through financial inclusion. It is mandated on Act 13/1962 about main rules of RDB in Indonesia. By the time, RDB get into competition with other banks on financial market yet strive for RDB to have financial efficiency. Therefore, it is needed to increase the competitiveness of RDB and also performing its role as the agent of regional development. This study is going to analyze financial efficiency of RDB in order to influence regional development in Indonesia. We employ panel data method using fixed-effect model for estimation using period of 2002 to 2012. Analysis will also take place on RDB’s performance to meet the mandate of ‘BPD Regional Champion’ (BRC) in order to be agent of regional development in Indonesia.

Suggested Citation

  • Yudistira Hendra Permana & Ike Yuli Andjani, 2014. "Financial efficiency performance of regional development bank (RDB) to support regional economy in Indonesia," International Journal of Economic Sciences, Prague University of Economics and Business, vol. 2014(4), pages 53-69.
    • Handle: RePEc:prg:jnljes:v:2014:y:2014:i:4:id:22:p:53-69
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    References listed on IDEAS

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    1. Stephany Griffith-Joneswith & David Griffith-Jo & Dagmar Hertova, 2008. "Enhancing the Role of Regional Development Banks," G-24 Discussion Papers 50, United Nations Conference on Trade and Development.
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    8. Michael Chibba, 2009. "Financial Inclusion, Poverty Reduction and the Millennium Development Goals," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 21(2), pages 213-230, April.
    9. C�line Meslier-Crouzille & Emmanuelle Nys & Alain Sauviat, 2012. "Contribution of Rural Banks to Regional Economic Development: Evidence from the Philippines," Regional Studies, Taylor & Francis Journals, vol. 46(6), pages 775-791, June.
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    Cited by:

    1. Murharsito & Fitri Ella Fauziah & Emanuel Kristijadi & Rr. Iramani, 2017. "Provincial corruption and local development bank performance," Economic Journal of Emerging Markets, Universitas Islam Indonesia, vol. 9(1), pages 66-73, April.

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    More about this item

    Keywords

    Panel data; RDB; financial efficiency; financial inclusion; regional economy;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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