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The Determinants Factor Of Islamic Bank’s Profitability And Liquidity In Indonesia

Author

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  • Rahmat Addillah
  • Muhamad Nadratuzzaman Hosen
  • Syafaat Muhari

Abstract

This research aims to analyzes the determinants factor of profitability and liquidity of the Bank Muamalat Indonesia, Bank Syariah Mandiri, and Bank Mega Syariah. Profitability variable represented by ROA (return on asset) and liquidity represented by quick ratio. Independent variable factor affecting profitability is the quick ratio, CAR, and ROA. Independent variable factor affecting liquidity is CAR, NPF, and OER. The analytical method used in this study is multiple regression analysis. The data used is the quarterly data from the years 2008 to 2015. The analysis showed that the quick ratio and OER have a negative and significant effect on profitability, and CAR has a positive and significant effect on profitability. CAR has positive and significant effect on liquidity, OER has a negative and significant negative effect to liquidity, and NPF has not significant effect to liquidity.

Suggested Citation

  • Rahmat Addillah & Muhamad Nadratuzzaman Hosen & Syafaat Muhari, 2016. "The Determinants Factor Of Islamic Bank’s Profitability And Liquidity In Indonesia," Knowledge Horizons - Economics, Faculty of Finance, Banking and Accountancy Bucharest,"Dimitrie Cantemir" Christian University Bucharest, vol. 8(2), pages 140-147, June.
    • Handle: RePEc:khe:journl:v:8:y:2016:i:2:p:140-147
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    References listed on IDEAS

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    1. Limon Moinur Rasul, 2013. "Impact of Liquidity on Islamic Banks’ Profitability: Evidence from Bangladesh," Acta Universitatis Danubius. OEconomica, Danubius University of Galati, issue 9(2), pages 23-36, April.
    2. Étienne Bordeleau & Christopher Graham, 2010. "The Impact of Liquidity on Bank Profitability," Staff Working Papers 10-38, Bank of Canada.
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