Research Article
The Impact of Cost to Income Ratio on Firm Value with Net Interest Margin as a Mediating Variable in the Banking Sector of ASEAN-5 Countries
@INPROCEEDINGS{10.4108/eai.4-9-2024.2353785, author={Adli Rikanda Saputra and Rindu Rika Gamayuni and Sudrajad Sudrajad}, title={The Impact of Cost to Income Ratio on Firm Value with Net Interest Margin as a Mediating Variable in the Banking Sector of ASEAN-5 Countries}, proceedings={Proceedings of the 7th International Conference of Economics, Business, and Entrepreneurship, ICEBE 2024, 4-5 September 2024, Shah Alam, Selangor, Malaysia}, publisher={EAI}, proceedings_a={ICEBE}, year={2024}, month={12}, keywords={cost to income ratio (cti) firm value (fv) net interest margin (nim) asean banking sector panel data analysis}, doi={10.4108/eai.4-9-2024.2353785} }- Adli Rikanda Saputra
Rindu Rika Gamayuni
Sudrajad Sudrajad
Year: 2024
The Impact of Cost to Income Ratio on Firm Value with Net Interest Margin as a Mediating Variable in the Banking Sector of ASEAN-5 Countries
ICEBE
EAI
DOI: 10.4108/eai.4-9-2024.2353785
Abstract
This study aims to analyze the impact of the Cost to Income Ratio (CTI) on Firm Value (FV) with Net Interest Margin (NIM) as a mediating variable in the banking sector of ASEAN countries during the period 2019-2023. Using panel data analysis and two structural models, the study finds that CTI has a significant negative relationship with NIM, indicating that increased cost inefficiency in banks can reduce NIM. Moreover, the results from the fixed effects model show that CTI does not have a significant direct effect on FV, but ROA is found to have a significant positive impact. This research highlights the importance of effective cost management in enhancing profitability and firm value in the ASEAN banking sector. These findings provide insights for policymakers to improve performance and financial stability in this sector.
