Proceedings of the 4th International Conference on Economics, Business and Economic Education Science, ICE-BEES 2021, 27-28 July 2021, Semarang, Indonesia

Research Article

The Analysis of Bank Specific Factors, Macroeconomics and Corporate Governance to Financing Risk in Islamic Commercial Banks in Indonesia

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  • @INPROCEEDINGS{10.4108/eai.27-7-2021.2316921,
        author={Muhammad Shaf Karim and Ruhadi  Ruhadi and Iwan  Setiawan},
        title={The Analysis of Bank Specific Factors, Macroeconomics and Corporate Governance                to Financing Risk in Islamic Commercial Banks in Indonesia},
        proceedings={Proceedings of the 4th International Conference on Economics, Business and Economic Education Science, ICE-BEES 2021, 27-28 July 2021, Semarang, Indonesia},
        publisher={EAI},
        proceedings_a={ICE-BEES},
        year={2022},
        month={3},
        keywords={financing risk (npf) bank specifics macroeconomics corporate governance banks},
        doi={10.4108/eai.27-7-2021.2316921}
    }
    
  • Muhammad Shaf Karim
    Ruhadi Ruhadi
    Iwan Setiawan
    Year: 2022
    The Analysis of Bank Specific Factors, Macroeconomics and Corporate Governance to Financing Risk in Islamic Commercial Banks in Indonesia
    ICE-BEES
    EAI
    DOI: 10.4108/eai.27-7-2021.2316921
Muhammad Shaf Karim1,*, Ruhadi Ruhadi1, Iwan Setiawan1
  • 1: Politeknik Negeri Bandung
*Contact email: muhammad.shaf.kps19@polban.ac.id

Abstract

Financing Risk is the root of financial instability in the banking sector. The aim of study is analysis of the factors that affect the financing risk level of NPF (non-performing finance) in Islamic banking such as bank-specific factors, macroeconomic factors, and corporate governance factors. This quantitative research utilizes a sample of all Islamic commercial banks in Indonesia for the period of 2015-2019 with analysis instruments of Structural Equation Model-Partial Least Square (SEM-PLS) that using WarpPLS 7.0. The results of data analysis indicate that bank-specific factors represented by CAR, FDR and age each have a significant relationship to NPF. Macroeconomic factors also affect the NPF as shown in the analysis of inflation and GDP data. Finally, corporate governance factors is FBD and BMD, also show their relationship to NPF.