Factors Influence Financial Sustainability Banking In Indonesia

Abstract

This research aims to determine the factors that affect the financial sustainability of conventional banks and sharia banks in Indonesia. Data obtained from the financial statements of conventional commercial banks and Islamic commercial banks have been published by the Financial Services Authority (OJK) for the period 2014 to 2018. The total population used in this study are all conventional and Sharia banks that publish their financial statements on the OJK. The research variables used include Financial Self Sufficiency (FSS) as the dependent variable. Return on assets (ROA), Cash to deposits (CTD), Loans to assets (LTA), Deposits to assets (DTA) as independent variables. The analysis used is the tree classification. The tree classification method requires the dependent variable in the form of categorical data. Processing results show that three financial performance factors affect financial sustainability, namely ROA, LTA, and DTA. Error in the analysis process is 29%. So that the accuracy of using the tree classification method in predicting the factors that affect banking financial sustainability is 71%.

The influence of Natural Certainty Contract (NCC) and Natural Uncertainty Contract (NUC) financings on the financial sustainability of Islamic commercial banks in Indonesia

“…The probability value of the Z variable (profitability) is 0.00 < 0.05, and the coefficient of Z is positive, indicating that profitability has a positive impact on financial sustainability. This research aligns with studies conducted by Marheni (2022), Rianasari & Pangestuti (2016), Sholikah & Miranti (2020), and Sutikno & Aisyah (2022), stating that ROA has a positive and significant effect on financial sustainability. Consistent with Marheni's study (2022), if a company has high profitability, it will become more active in implementing financial sustainability because the implementation of financial sustainability also requires expenses.…”

“…These findings are inconsistent with studies conducted by Dini ( 2021 2020), which suggest that NUC financing has a significant negative impact on ROA. Furthermore, these results do not align with research by Sholikah & Miranti (2020) and Sutikno & Aisyah (2022), which state that profitability (ROA) has a significant positive impact on financial sustainability. Therefore, it can be concluded that the profitability variable cannot mediate the influence of NUC financing on financial sustainability.…”

“…profits (Haq, 2015). According to research (Rianasari & Pangestuti, 2016;Sholikah & Miranti, 2020;Sutikno & Aisyah, 2022), profitability (ROA) has a positive and significant impact on financial sustainability. In line with a study by Marheni (2022), a high company profit leads to increased activity in implementing financial sustainability because it involves costs.…”

“…These findings contradict studies conducted by Alfie & Khanifah (2018), Faradilla et al (2017, Hidayah (2013), Idris (2019), andMilzam &Siswanto (2019), which suggest that NCC financing has a significant positive impact on ROA. According to research by Sholikah & Miranti (2020) and Sutikno & Aisyah (2022), profitability (ROA) has a significant positive impact on financial sustainability. The results of this study indicate that the higher the distribution of NCC financing, the smaller the profitability or profit obtained by the company.…”