Capital, Operational Efficiency And Credit Risk In The Banking Intermediation

Abstract

-Regional Development Bank in Indonesia was established to accelerate the growth of the economy. But in reality the contribution of BPD to Gross Regional Domestic Product in 2014 was still relatively small. The aim of this study was to analyze the factors that affect the banking intermediation includecapital, operational efficiency, and credit risk. The methods used are descriptive and verificative, with secondary data from financial statements all over 26 Indonesian Regional Development Banks as a research object’s units. Data analysis technique is the multiple linear regression, hypothesis testing while using t test to examine the effect of partial variables and test F to examine the effect of variables simultaneously with a significance level of 5 %.Based on the results it is concluded that partial CARand OEOIhave positive and significant effects on LDR. While the NPLshas negativeand significant effect on LDR. Simultaneously CAR, OEOI and NPLs significant effect on the LDR with level of influence of 12.8% and the remaining influenced by other factors not examined in this study