The Impact of Macroeconomic Factors on Credit Risk in Conventional Banks and Islamic Banks: Evidence from Indonesia

Abstract

The banking sector is viewed as an important figure in the economic development. However, this sector is vulnerable to macroeconomic instability which lead to higher credit risk of banks. Motivated by the fact that unlike conventional banking, there is limited research study about the impact of macroeconomic factors on credit risk in Islamic banking. Therefore, further research to study about it has become important. This research aim is to evaluate the association between macroeconomic factors with credit risk through comparative analysis of these two kinds of banking system. Empirical results suggest that Islamic banks are more resistant during crisis, and only two variables (Exchange Rate and MS) which are significant to credit risk in Islamic banks. Meanwhile, in conventional banks almost all variables are significant except Industrial Production Index. This research is expected to give contributions to literature, and provide comparable information on the credit risk profile across the banks to stakeholders.

Factors Affecting Non-Performing Financing at Islamic Commercial Banks in Indonesia

“…The result of this study is in line with the previous studies conducted by Akbar (2016)dan Financing to Deposit Ratio (FDR, Lidyah (2016)Biaya Operasional Pendapatan Operasional (BOPO, Havidz & Setiawan (2015)the determinants of banks efficiency and nonperforming financing (NPF and (Lin, Farhani, & Koo, 2016) which state that inflation does not affect Non-Performing Financing (NPF) at Islamic Commercial Banks. This hypothesis is rejected because the Sharia Commercial Bank has stronger endurance compared to Conventional Banks.…”

Macroeconomics And Profit Sharing Financing In Islamic Banking In Indonesia: The Third Parties Fund As Intervening

“…The continued growth of third parties fund has become a problem, this is an indication that Islamic banks are not very interested in Indonesians as a reference in placing funds to be combined in Islamic banks. Even though these third parties fund will later be used by Islamic banks to be distributed back to customers through financing (Huey-Yeh Lin & Koo, 2016).…”

Pengaruh Kondisi Makroekonomi Terhadap Risk Profile Pada Bank Umum Syariah di Indonesia

“…Sehinggai hipotesis dalam penelitian untuk H01 ditolak. Hasil yang diperoleh akan tidak adanya pengaruh inflasi terhadap NPF, sejalan dengan hasil penelitian oleh Akbar (2016), Lin et al (2016), Effendi dan Yuniarti (2018), Nugraha dan Setiawan (2018), Alif dan Hendratno (2019), dan Najiatun et al (2019). Inflasi tidak akan memengaruhi jumlah dari uang yang dibayarkan ke bank.…”

“…Inflasi tidak akan memengaruhi jumlah dari uang yang dibayarkan ke bank. Sehingga walaupun terdapat inflasi, nasabah harus tetap membayar sesuai dengan perjanjian yang telah disepakati (Lin et al, 2016).…”