Abstract
This research aims at analyzing the level of efficiency with intermediation approach and determinant of efficiency of Bank Pembangunan Daerah (BPD). Efficiency is measured using the Data Envelopment Analysis (DEA) method based on the intermediation approach. This research contribute on modelling of determinant of efficiency of Bank Pembangunan Daerah (BPD) using intermediation approach. The object of this research is 26 BPD(s). Furthermore, the determinant of efficiency of BPD is analyzed using the Tobit regression. The level of efficiency is the dependent variable. Meanwhile, the independent variables used are CAR, LDR, NPL, NIM, ROA, Inflation, Economic Growth, and Interest Rate. The research results show that BPD has a different efficiency level average (high, sufficient, moderate, and low efficiency level average). This is due to the use of inputs that have an impact on the optimal output maximization. CAR and LDR have the significant and positive effects on the efficiency of BPD. Interest rate and inflation have the significant and negative effects on the efficiency of BPD. Meanwhile, NPL, NIM, ROA and Economic Growth have no effects on the efficiency of BPD. This results is expected to contribute in identifying any factor affecting the efficiency of BPD, both the internal and macro economy, and also to be the stimulus for the development of health measuring instrument of BPD in which efficiency reflects the quality of risk management on the intermediary activity of BPD.
Highlights
Finance institutions especially banking have a very important role in the economy that is as an intermediary institution or intermediation (Kurnia, 2004)
This research aims at examining the efficiency level and analyzing the determinant of efficiency level of Bank Pembangunan Daerah in Indonesia during the period of 2012-2016
If LDR increases of 1% and the other variables are considered to be constant, the efficiency of Bank Pembangunan Daerah (BPD) will increase of 0,092%
Summary
Finance institutions especially banking have a very important role in the economy that is as an intermediary institution or intermediation (Kurnia, 2004). According to the Acts No 13 in 1962, BPD is a bank built in the first-level autonomous region, which is intended to provide the financing for the implementation of the regional development planning in the framework of the Universal National Development of Planning. BPD has a strategic role in encouraging the regional economy in the form of the provision of financial service products in line with each region’s characteristics and needs. Another role of Jurnal Ekonomi Pembangunan, ISSN 1411-6081, E-ISSN 2460-9331
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