The Effect of Funding Source on Profitability of BPR

Abstract

Profitability plays an important role in ensuring that financial institutions can survive in the long term. This study focuses on funding sources and profitability by considering two variables that refer to profitability, namely Return on Assets and performance efficiency (BOPO) using the Balanced data panel from 34 BPR in Indonesia for the 2018-2021 period. Panel data regression analysis has been used in this research. EAR and DTL have a positive effect on ROA. Furthermore, EAR, DTL, LDR, and Size increase performance efficiency (BOPO). The findings will enable BPRs or other financial institutions to utilize resources to maximize financial performance that has an impact on profitability.