Determinant of Non-performing Financing in Indonesia Islamic Bank

Abstract

In 2017, there was an increase in Non Performing Financing (NPF) in Islamic Bank until the NPF Ratio reached five point twenty seven percent. It shows that NPF Ratio in that period has exceeded the standard provision of Bank Indonesia of five percent. This phenomenon is one of things that caused by the high channeling of financing to customers without accompanied by an increase in financing quality. This study aims to examine the determinants of non performing financing period 2013-2018. This study uses secondary data from six Indonesia Islamic Bank. This study used descriptive explanatory method with data analysis technique is panel data regression. The dependent variable used in this study is the non performing financing. Furthermore, the independent variables are Capital Adequacy Ratio (CAR), Financing to Deposit Ratio (FDR) and Bank Indonesia Sharia Certificates (SBIS). The results showed that the CAR and FDR have a significant negative effect on NPF. While, the SBIS rate has not effect on NPF. The result of simultaneous regression show that the CAR, FDR and SBIS rate have effect on NPF. Thus it can be concluded that when CAR and FDR increases, it will decrease the NPF and when SBIS increases, it does not affect the NPF.

Determinant of sharia banks profitability in Indonesia: The moderating effect of non performing financing

“…Bank yang memiliki CAR di atas 8 % menggambarkan kemampuan bank yang lebih baik untuk mengatasi risiko yang muncul dari pembiayaan yang diberikan (Santoso, 2020). CAR dapat dihitung dengan membagi modal bank dengan nilai aset tertimbang menurut risiko (ATMR) (Silaban, 2017;Wulandari et al, 2019;dan Kusumastuti & Alam, 2019).…”

The Influence of Bank Specific Factors and Macro Economics on Non-Performing Financing in Islamic Rural Banks

“…Excess liquidity conditions are a demand for banks to channel funds to customers with little regard to business risks and the risk of problematic financing that can occur (Munifatussa, 2020). Based on research conducted at Development Banks in Aceh Damanhur et al, (2018) and on Islamic Commercial Banks by Visca Wulandari et al, (2019) resulted in a statement that FDR has a positive relationship with NPF while research produced by Wood & Skinner (2018) on Commercial Banks in Barbados shows that FDR has a negative relationship with NPF.…”

“…Banks as intermediary institutions, have the duty to collect funds and give them back to the community through financing products offered to prospective debtors (Retnowati & Jayanto, 2020). However, when the bank concerned distributes financing, there are a number of risks, one of which is the emergence of financing (Visca Wulandari et al, 2019).…”

Faktor-Faktor Non-Performing Financing (NPF) di Bank Umum Syariah Indonesia

“…Penelitian dengan judul "Determinants of Non Performing Financing in Indonesian Islamic Banks" (Sukmana, 2015), fokus meneliti pada faktor-faktor penentu pembiayaan di perbankan syariah dan perbankan konvensional. Data diambil dari tahun 2004-2014 dengan variabel kecukupan modal, tingkat pembiayaan, tingkat suku bunga, pembiayaan syariah, pinjaman konvensional, indeks produksi industri sebagai proxy untuk PDB, harga, dan nilai tukar.…”

“…Tampaknya kecukupan modal dalam jangka panjang merupakan sorotan yang sangat penting baik dari segi makro atau mikro dalam perbankan syariah. Hasil ini didukung oleh penelitian sebelumnya yaitu oleh (Sukmana, 2015) menunjukkan hasil CAR berpengaruh negative dan signifikan terhadap NPF.…”