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Determinants of Bonds Rating: Case Study of Indonesian Banking Listed on The Indonesia Stock Exchange

In: Proceedings of the 8th Global Conference on Business, Management, and Entrepreneurship (GCBME 2023)

Author

Listed:
  • Muhammad Bayu Aji Sumantri

    (Universitas Pendidikan Indonesia)

  • Nugraha Nugraha

    (Universitas Pendidikan Indonesia)

  • Maya Sari

    (Universitas Pendidikan Indonesia)

  • Ikaputera Waspada

    (Universitas Pendidikan Indonesia)

Abstract

This research aims to study the influence of profitability, solvency, and Good Corporate Governance mechanisms on bond ratings in Indonesia. The population used in this research consists of companies listed on the Indonesia Stock Exchange during the period of 2018-2022, and the sampling method employed is purposive sampling. A sample of 21 companies in the banking sector, which have been listed on the Indonesia Stock Exchange for more than 10 years, was obtained. The data analysis technique used is multiple regression analysis. The research findings reveal that good corporate governance, represented by institutional ownership, profitability represented by Return on Equity, and solvency represented by Debt to Equity Ratio, have a positive influence on bond ratings. However, liquidity represented by the Current Ratio does not have a significant effect on bond ratings.

Suggested Citation

  • Muhammad Bayu Aji Sumantri & Nugraha Nugraha & Maya Sari & Ikaputera Waspada, 2024. "Determinants of Bonds Rating: Case Study of Indonesian Banking Listed on The Indonesia Stock Exchange," Advances in Economics, Business and Management Research, in: Ratih Hurriyati & Lili Adi Wibowo & Sulastri Sulastri & Lisnawati Lisnawati (ed.), Proceedings of the 8th Global Conference on Business, Management, and Entrepreneurship (GCBME 2023), pages 244-250, Springer.
    • Handle: RePEc:spr:advbcp:978-94-6463-443-3_34
    DOI: 10.2991/978-94-6463-443-3_34
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