The effect of risk on profitability in banks listed on the Indonesia Stock Exchange
Keywords:
Insolvency Risk, Liquidity Risk, Credit Risk, Security Risk, Capital Risk, Market Risk, Operational Risk, Profitability
Abstract
This study aims to analyze the effect of (1) insolvency risk, (2) liquidity risk, (3) credit risk, (4) security risk, (5) capital risk, (6) market risk, and (7) operational risk on profitability in banks listed on the Indonesia Stock Exchange. The population in this study were all 50 banks listed on the Indonesia Stock Exchange in 2015-2019. The sampling technique in this study used the purposive sampling technique with a total sample of 30 banks from 2015-2019. The data used in this study is secondary data obtained from www.idx.co.id with multiple regression analysis as the analysis tool. The results of this study indicate that (1) insolvency risk has a positive and significant effect on the profitability of banks that have Go Public, (2) liquidity risk has a positive and insignificant effect on profitability of banks that have Go Public,
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References
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Veithzal, R. (2013). Commercial Bank Management. Jakarta: Rajawali Press.
Andrianto, Fatihuddin, D., & Firmasnyah, A. (2019). Bank Management (Issue January). Surabaya: Qiara Media.
Aprita, S. (2019). Implementing the Principle of Business Continuity Using the Insolvency Test: Efforts to Realize Restructuring Justice-Based Legal Protection for Bankrupt Debtors in Bankruptcy Dispute Resolution. East Java: Cv Pustaka Abadi.
Arif, A., & Anees, AN (2012). Liquidity risk and performance of banking system. Journal of Financial Regulation and Compliance, 20(2), 182–195. https://doi.org/10.1108/13581981211218342
Brigham, EF, & Houston, JF (2011). Fundamentals of Financial Management. In The Journal of Finance (Vol. 34, Issue 5). Jakarta: Rajawali Press. https://doi.org/10.2307/2327254
Capriani, N., & Dana, I. (2016). The Effect of Credit Risk on Operational Risk and Liquidity Risk on Bpr Profitability in Denpasar City. Udayana University Management E-Journal, 5(3), 255267.
Driptryanto, P., & Wahyuati, A. (2017). Comparison of Risk and Return on Bonds, Forex, Gold in Determining Investment Decisions. Journal of Management Science and Research, 6(5), 1–15.
Ekinci, R., & Poyraz, G. (2019). The Effect of Credit Risk on Financial Performance of Deposit Banks In Turkey. Procedia Computer Science, 158, 979–987. https://doi.org/10.1016/j.procs.2019.09.139
Fahmi, I. (2011). Risk Management: Theory, Cases and Solutions. Bandung: Alphabeta.
Greuning, H. van, & Iqbal, Z. (2011). Islamic Banking Risk Analysis. Jakarta: Four Salemba.
Hanggraeni, D. (2019). Sharia Financing Risk Management. Bogor: IPB Press.
Idroes, FN (2008). Banking Risk Management. Jakarta: Rajawali Press.
Indriantoro, N., & Supomo, B. (2018). Business Research Methodology for Accounting and Management. Yogyakarta: Andi and BPFE.
Karamoy, H., & Tulung, JE (2020). The impact of banking risk on regional development banks in Indonesia. Banks and Bank Systems, 15(2), 130–137. https://doi.org/10.21511/bbs.15(2).2020.12
cashmere. (2013). Financial Statement Analysis. Jakarta: Rajawali Press.
Lumumba, A. wisesa. (2019). Diversity of the age of the board of commissioners, profitability, and risk taking of the bank. Surabaya: Airlangga University.
Mendoza, R., & Rivera, JPR (2017). The effect of credit risk and capital adequacy on the profitability of rural banks in the Philippines. Scientific Annals of Economics and Business, 64(1), 83–96. https://doi.org/10.1515/saeb-2017-0006
Radianto, W., & Ayungningtyas, C. (2010). Comparison of Risk and Return on Investment in Gold, Stocks and Mutual Funds in determining Investment Decisions. Angewandte Chemie International Edition, 6(11), 951–952., 1(2), 105–117.
Rahman, MM, Hamid, MK, & Khan, MAM (2015). Determinants of Bank Profitability: Empirical Evidence from Bangladesh. International Journal of Business and Management, 10(8), 135–150. https://doi.org/10.5539/ijbm.v10n8p135
Saleh, I., & Abu Afifa, M. (2020). The effect of credit risk, liquidity risk and bank capital on bank profitability: Evidence from an emerging market. Cogent Economics and Finance, 8(1). https://doi.org/10.1080/23322039.2020.1814509
Septiana, A. (2019). Financial Statement Analysis: Basic Concepts and Description of Financial Statements. East Java: Duta Media Publishing.
Sjahdeini, SR (2016). History of the Principles and Theory of Bankruptcy Law. Jakarta: Kencana Prenadamedia Group.
Sudana, IM (2009). Financial Management Theory and Practice. Surabaya: Airlangga University Press.
Sudirman, W. (2013). Banking management. Jakarta: Kencana Penada Media Group.
Sudiyatno, B., & Fatmawati, A. (2013). The Influence of Credit Risk and Operational Efficiency on Bank Performance (Empirical Study on Banks Listed on the Indonesia Stock Exchange). JOURNAL OF Organization And Management, 9(1), 73–86.
Sudiyatno, B., & Suroso, J. (2010). Analysis of the Effect of Third Party Funds, BOPO, CAR and LDR on Financial Performance in the Go Public Banking Sector on the Indonesia Stock Exchange (IDX). Dynamics of Finance and Banking, 53(9), 1689–1699.
Sulindawati, NLGE, Yuniarta, GA, & Purnawati, IGA (2018). Financial Management: As a Basis for Decision Making. Depok: Rajawali Press.
Sutrisno, B. (2018). Determinants of Profitability of Conventional Commercial Banks Listed on the Indonesia Stock Exchange. Essence: Journal of Business And Management, 8(1), 41–48. https://doi.org/10.15408/ess.v8i1.6554
Tan, Y., & Floros, C. Anchor, J. (2017). The Profitability of Chinese Banks: Impacts of Risk, Competition and Efficiency. Review of Accounting and Finance, 16(1), 40(C): 85-110.
Tanjung, K., West, J., Tanjung, W., & Regency, J. (2013). The Influence of NIM, BOPO, LDR, NPL & CAR on ROA of International Banks and National Banks Go Public for the Period 20017-2011. 1(3), 198–215.
Veithzal, R. (2013). Commercial Bank Management. Jakarta: Rajawali Press.
