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Performance analysis of sharia commercial banks in Indonesia before the covid pandemic period (2015-2019)

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  • Erna Handayani

    (Universitas Muhammadiyah Purwokerto, Jl. KHA Dahlan 103 Purwokerto 53182, Indonesia)

  • Alni Rahmawati

    (Universitas Muhammadiyah Yogyakarta, Tamantirto, Kasihan, Yogyakarta 55183, Indonesia)

  • Naelati Tubastuvi

    (Universitas Muhammadiyah Purwokerto, Jl. KHA Dahlan 103 Purwokerto 53182, Indonesia)

  • Ira Hapsari

    (Universitas Muhammadiyah Purwokerto, Jl. KHA Dahlan 103 Purwokerto 53182, Indonesia)

Abstract

Overcoming the impact of the Covid pandemic on Islamic banking in Indonesia, management must take strategic steps based on predictions and previous performance identification. Identify performance, information on the factors that affect the performance of Islamic banking in Indonesia is needed. Several aspects that are considered to affect Islamic banking performance that management must consider are capital, liquidity aspects, credit risk, and efficiency. This research examines the influence of the aspects of capital (Capital Adequacy Ratio and Third Party Funds), liquidity (Finance to Debt Ratio ), credit risk (Non-Performing Financing).) and operational efficiency (BOPO) on the performance of Islamic banking in Indonesia 5 (five) years before the Covid pandemic occurred in Indonesia (2015-2019). The results showed that these five aspects had a simultaneous effect on Islamic banking performance in Indonesia, with a termination coefficient of 94.4%. Of the five variables, CAR, FDR, NPF, and BOPO significantly affect performance, while TPF has no significant effect on performance (Return on Assets). Key Words: Performance, Islamic Banking, Bank Health Ratio, Return on Asset, Capital Adequacy Ratio, Non Performing Financing, Third Party Funds

Suggested Citation

  • Erna Handayani & Alni Rahmawati & Naelati Tubastuvi & Ira Hapsari, 2021. "Performance analysis of sharia commercial banks in Indonesia before the covid pandemic period (2015-2019)," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 10(2), pages 228-237, March.
    • Handle: RePEc:rbs:ijbrss:v:10:y:2021:i:2:p:228-237
    DOI: 10.20525/ijrbs.v10i2.1010
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    References listed on IDEAS

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    1. Faisal Abbas & Shahid Iqbal & Bilal Aziz, 2019. "The impact of bank capital, bank liquidity and credit risk on profitability in postcrisis period:‎ A comparative study of US and Asia," Cogent Economics & Finance, Taylor & Francis Journals, vol. 7(1), pages 1605683-160, January.
    2. Dhiaa Shamki & Ibrahim Alulis & Karima Sayari, 2016. "Financial Information Influencing Commercial Banks Profitability," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 8(6), pages 166-166, June.
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