How Liquidity, Bank Efficiency, and NPF Ratio Impact on Islamic Commercial Bank Performance During the Covid-19 Pandemic?

Abstract

The Covid-19 pandemic has had a major impact on the Indonesian economy, including the banking sector. Both Islamic and conventional banks must seek solutions in order to maintain their financial performance. The government is implementing the new normal era as an adaptation phase for all business lines in formulating economic improvement strategies. This study aims to find out how bank liquidity, bank efficiency, and the NPF ratio influence the performance of Islamic commercial banks during the period March 2020 until March 2021. Data were taken from the quarterly financial statements of each bank, processed using the analysis tool E-Views 9. The result shows that bank efficiency and liquidity have a significant effect on the profitability of Islamic commercial banks during the covid-19 pandemic. This research is expected to provide input to Islamic commercial banks in conducting mitigation of their business risk in the era of the covid-19 pandemic.

The Effect of the Covid 19 Pandemic on Bank Performance Cases of Regional Development Bank in Indonesia

“…Financial performance is part of the bank's overall performance that needs to be evaluated in order to determine the right rational decisions within the company (Insani, 2021). Analysis of financial ratios used by a company to determine company performance can be seen from the Profitability Ratio, Solvency Ratio and Liquidity Ratio.…”