Abstract
A bank has an important role in every country including Indonesia. The bank is aimed at maintaining economic growth and national financial stability. This study is to measure and analyze the financial performance between Bank Negara Indonesia (BNI), Bank Rakyat Indonesia (BRI), Bank Mandiri, and Bank Central Asia (BCA) against the national performance condition from under Bank Indonesia’s regulation No. 1 3 /1 /PBI/2 01 1 about Banks Financial Health Assessment. The data were collected from the annual report each company for the period 2012 – 2016. Furthermore, this study measure and analyze their level of financial health performance with Risk-based Bank Rating (RBBR) approach. RBBR examines NonPerforming Loan Ratio (NPL), Loan to Deposit Ratio (LDR), Current Account and Saving Account Ratio (CASA), Return on Asset (ROA), and Capital Adequacy Ratio (CAR). The result shows that those banks have a good financial performance which can be categorized into an ideal and very healthy condition. The finding results will be useful for students to deepen understanding about financial ratio and for bankers to analyze and make a strategy to improve the performance.
Highlights
A bank is a inancial institution that acts as an intermediary who accepts deposits from the public and distribute credit
Bank Indonesia applied the regulation that 8% from Loan to Deposit Ratio (LDR) ratio as a statutory reserve, if the ratio exceeds 92% it means the 8% is taken from non-third parties fund for credit expansion
From igure 1. denotes that from 2012 until 2014, the national condition remains stable means that cumulative of all banks in Indonesia can maintain the ratio under 2%
Summary
A bank is a inancial institution that acts as an intermediary who accepts deposits from the public and distribute credit. Banks aimed in supporting the implementation of national development in order to maintain economic growth and national stability. Due to their importance in the inancial stability of a country, banks are highly regulated in most countries including Indonesia. Indonesian banking industry faced a challenging period in riding the business slowdown, managing bad loans International Journal of Business Studies Vol 2 No 1 ( February 2018). A downward trend of loan growth), and an increasing rate of non-performing loans (NPL). Since the beginning of 2014, economic growth has been trending down as exports of primary commodities fell, and growth slowed in the international market, especially China. The high interest rate environment and the weakening of Rupiah had affected the domestic demands as well
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