The Effect of Bank Soundness Ratio towards Financial Performance on Commercial Banks Moderated by Good Corporate Governance


Authors : Putri Aprilita Hapsari; Indra Siswanti

Volume/Issue : Volume 8 - 2023, Issue 1 - January

Google Scholar : https://bit.ly/3IIfn9N

Scribd : https://bit.ly/3YU9bE3

DOI : https://doi.org/10.5281/zenodo.7647948

The purpose of this study is to determine the impact of bank health indicators on bank financial performance governed by good corporate governance. The subjects of this study are commercial banks KBMI IV registered with the Indonesian Financial Authority (OJK) in the period from 2017 to 2021. The sampling technique uses the saturation sampling method (census), and the total sample consists of 4 commercial banks. The measurement of the variables used in this study was made in the form of a scale of coefficients with a quantitative approach, using 5 (five) year time series data from the reports published by KBMI IV Bank in the period from 2017 to 2021. The analysis method used in this study is panel data regression analysis supported by Eviews 10 software. The results show that the financial indicators of banks can be optimized by maintaining the values of capital adequacy and lending indicators within predetermined safety limits and further strengthening by publicizing good corporate governance by the company. Meanwhile, non-performing loans and corporate social responsibility do not affect banks' financial performance, although they are supported by corporate governance information.

Keywords : Financial Performance, Capital Adequacy Ratio, Non-Performing Loans, Loan-To-Deposit Ratio, Corporate Social Responsibility, Good Corporate Governance.

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