Utilizing Mudharabah and Musyarakah Financing to Increase Return on Equity (ROE) at PT. Indonesian Sharia Bank Tbk. of Padang Bulan Branch

Abstract

This study aims to determine the analysis of mudharabah (profit sharing) and musyarakah (partnership) financing to increase Return on Equity (ROE) at Bank Syariah Indonesia (BSI) Tbk. Research was conducted at BSI’s Padang Bulan Branch Office involving descriptive quantitative methods. In the data collection, we used documentation technique from secondary sources published in Indonesia Stock Exchange. Data taken from the company might include financial statements for the years 2018-2020.The results show that mudharabah financing decreased, compared to the musyarakah financing; the ROE received was still low. Cooperation in the form of mudharabah and musyarakah financing certainly provided benefits for the bank and the customers.The company faced obstacles in financing, especially mudharabah financing and also in ROE due to low customer interest in mudharabah financing compared to musyarakah financing. In other words, if there is a loss, the loss would only be borne by one party. This of course can raises doubts, both by the bank and the customers. So, indirectly, all this has impacts on the bank preferring to further increase musyarakah financing, and also brings impacts on customer motivation to prefer musyarakah financing because the financing in the event of a loss would be divided according to the initial agreement. On overall, mudharabah and musyarakah financing is the profit-sharing financing that most dominantly affects the level of ROE. Keywords: Mudharabah (profit sharing), Musharakah (partnership), Bank Syariah Indonesia, Return On Equity.