Abstract
Background - The growth potential of sharia banking business in Indonesia is increasing, so it is important to evaluate the performance of sharia banking. Aim - This study aims to examine the effect of core capital on the profitability and performance of Islamic Commercial Banks listed on the Indonesia Stock Exchange. This research is expected to provide input in financial knowledge, especially in the field of evaluating bank financial performance and the factors that influence it. Design/ Methodology/ Approach - The research object is 12 Islamic banks in Indonesia. The data is taken from the financial statements of each Islamic bank from 2015 to 2018. Hypothesis testing is carried out using a structural equation model with the WARP PLS program. Results and Discussion – The results show that core capital has a significant effect on profitability, as well as profitability has a significant effect on core capital. The results also show that core capital has no effect on performance and performance has no significant effect on core capital. The results showed that profitability had no effect on performance. Conclusion - The results of this study conclude that of the five hypotheses proposed only two are accepted, namely core capital has a significant effect on profitability, and vice versa profitability also has a significant effect on core capital. This study produces evidence that core capital has no significant effect on the performance of Islamic banks. Likewise, it turns out that profitability also does not significantly affect the performance of Islamic banks, but on the contrary, the performance of Islamic banks has no significant effect on profitability. Research implications - for the Islamic banking business, this research can provide input on how to measure the performance of Islamic banks through the profitability and core capital of Islamic banks. The object of research is 12 Islamic banks in. Limitations of the study - The research was carried out during the period when Islamic banks in Indonesia had not been merged
Highlights
The results show that core capital has a significant effect on profitability, as well as profitability has a significant effect on core capital
The results show that core capital has no effect on performance and performance has no significant effect on core capital
The results showed that profitability had no effect on performance
Summary
Modal inti dan Profitabilitas bank berpengaruh sihnifikan terhadap kinerja perbankan (Naseer, 2019). Indonesia merupakan Negara dengan penduduk muslim terbesar di dunia Investment, 2020) Lebih lanjut dikatakan bahwa penduduk negara Indonesia beragama Islam, Hal ini yang membuat. Indonesia menjadi pasar potensial yang penting dalam mengembangkan produk/jasa keuangan syariah. Industri jasa keuangan syariah sgresif melakukan edukasi dan sosialisasi tentang peranan bank syariah yang dapat menimbulkan kedaran (awareness) dan keinginan masyarakat luas untuk menggunakan jasa perbankan syariah. Ada perbedaan yang cukup berarti antara mekanisme dalam perbankan syariah dibandingkan perbankan konvensional. Unsur utama yang membuat berbeda adalah pemenuhan kepatuhan terhadap nilai-nilai syariah (shariah compliance) dari masyarakat terhadap aturan agama Islam. Perbedaan ini merupakan keutamaan dari bank syariah dibanding bank konvensional, karena sistem yang diterapkan mampu menjamin penerapan nilai-nilai syariah yang diajarkan dalam agama Islam (Mardian, 2015)
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
