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IJSTR >> Volume 8 - Issue 10, October 2019 Edition



International Journal of Scientific & Technology Research  
International Journal of Scientific & Technology Research

Website: http://www.ijstr.org

ISSN 2277-8616



Understanding The Motivation Of Banking Impairment Policies In Indonesia

[Full Text]

 

AUTHOR(S)

Andy Lasmana, Tjut Tenriwali, Ade Budi Setiawan, Mas Nur Mukmin, Farizka Susandra

 

KEYWORDS

Banking, Impairment, Financial Ratios.

 

ABSTRACT

The phenomenon shows that impairment can be processed to improve financial performance through the low allowance of losses established by the Bank to obtain high profits or high allowance of losses established to prevent an increase in Non-Performing Loans. Disclose the motive behind impairment policy conducted by banking industries in Indonesia, is the aim of this study. This research was conducted on 89 public banks in Indonesia in the period 2013 to 2017. The sample used was 151 serial data. The t test and F test are the methods used in this study. The results show that simultaneously, Customer Deposits, Total Financing, Write Off, ROA, CAR, NIM, Operational Efficiency, LDR, and NPL have an effect on the allowance for impairment losses. Partially, Customer Deposits, Total Financing, Write Off, ROA, and NPL have insignificant effect on the allowance for impairment losses. This research has succeeded in proving that, there is another motivation behind the impairment policies carried out by banking companies in Indonesia. A variance test should be held to obtain another evidence of side motive of an impairment policy.

 

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