Financial Performance Of Islamic Banks Research Articles

Financial Performance of Islamic Banks in Indonesia: Islamic Performance Indeks Approach

Financial Performance of Islamic Banks in Indonesia: Islamic Performance Indeks Approach

Impact of Partnership Based and Non-Partnership Based Shariah Complaint Products on the Financial Performance of Islamic Banks

The present study evaluates the impact of Shariah compliance on profitability. By applying the fixed effect model, this study examines the impact of investment in partnership-based and non-partnership-based modes of financing on the financial performance of Islamic banks. Unbalanced panel data has been extracted from the financial reports (2008-2021) of all full-fledged Islamic banks operating in Pakistan. Shariah compliance is measured using two self- constructed proxies following experts’ survey; whereas financial performance is calculated as “net income to average total assets”. The study finds that investment in partnership-based modes of financing had a positive association with financial performance. However, the study fails to find any association between investments in non-partnership based modes of financing and financial performance of Islamic banks. Moreover, the study recommends that Islamic banks should increase their investment in partnership based mode of financings as it will increase their profitability and improve their public image of being ‘Islamic’.

Financial Performance of Islamic Banks: A Comparative Analysis Before and During The COVID-19 Pandemic

The protracted pandemic has an impact on the Islamic banking industry. Comparing the financial performance of Islamic financing before and during the COVID-19 outbreak helped to evaluate the impact of this factor. This type of quantitative research utilizes secondary data in the form of monthly financial reports from the Financial Services Authority’s website for 2018–2021. The variables used are ROA, FDR, BOPO, NPF, and CAR. Before and throughout the COVID-19 epidemic, Islamic banks demonstrated varied financial performance levels as measured by the ratios of ROA, FDR, BOPO, and CAR. ROA and CAR ratios have risen throughout the COVID-19 epidemic. During the COVID-19 pandemic, the FDR, BOPO, and NPF ratios declined. The ratio of BOPO to CAR is the finest and most consistent of these five ratios, ranking first (very healthy) before and during the pandemic. The ROA ratio for FDR and NPF remains standard, with an average ranking of second (healthy). The bank’s condition stayed normal and healthy over the 2018–2021 period, both before and after the COVID–19 epidemic, despite variations in the financial performance of Islamic banks as indicated by the ROA, FDR, BOPO, NPF, and CAR ratios.

Analisis Kinerja Keuangan Perbankan Syariah Menggunakan Metode CAMEL di PT. Bank Tabungan Pensiunan Nasional Syariah Periode 2019-2022

For banking institutions, the role of financial performance is very important. Because, if the financial performance of a bank has a good predicate, it can directly increase public confidence in making loans or investing. The fluctuating JCI in stock exchange trading certainly affects the stock performances of several issuers, including BTPN Syariah. BTPN Syariah shares have fluctuated from 2019 - 2022. And 38.77% of foreign sales have occurred, so it is very interesting to conduct this research. The purpose of this study was to determine the financial performance of Islamic banking based on the CAMEL (Capital, Asset, Management, Earning and Liquidity) method at PT. Sharia National Pension Savings Bank for the 2019-2022 Period. This study uses a descriptive method with a quantitative approach. Based on the results of the discussion above, it can be concluded that the health level of BTPN Syariah for the 2019-2022 period is based on: 1). Capital (capital) received the title "Very Healthy". Because the CAR value obtained is greater than 12% in accordance with Bank Indonesia regulations; 2). Assets (Quality of Earning Assets) received the title “Healthy”, because the KAP value obtained was below 10.35%; 3). Management (Management) by assessing the level of NPM (Net Profit Margin) gets the predicate "Sufficiently Healthy", because the NPM value obtained is in the range of 66%-81%; 4). Earning (profitability) uses two ROA and BOPO ratios, ROA for 2019-2022 gets the "Very Healthy" category, because the ROA value obtained is above 1.5%. Meanwhile, the health level of the BOPO ratio for the 2019-2022 period is in the "Very Healthy" predicate, because the BOPO value obtained is smaller than 94%. 5). Liquidity (Liquidity) using the ratio of FDR (Finance to Deposit Ratio) obtained the predicate "Sufficiently Healthy", because the FDR value obtained is in the range of 85%-100%. Furthermore, based on the results of calculating the soundness level of BTPN Syariah in 2019-2022 using the CAMEL method, it is in the "Healthy" position, because the resulting CAMEL value is in the range of 81-100, meaning that BTPN Syariah banks during the 2019-2022 period are considered capable of managing finances or performance. Islamic banking finance well.

Pengaruh Sharia Compliance dan Islamic Corporate Governance terhadap Kinerja Keuangan Perbankan Syariah

The purpose of this study was to determine the effect of sharia compliance and Islamic corporate governance rate on financial performance in Islamic banks in Indonesia in 2017-2021 and the sample in this study is 6 banks with a 5 years research period so that the total sample used in this study amounted 30. The sample in this study was obtained by using purposive sampling method. The research method uses an associative approach quantitative and SmartPLS software is used for data processing. This study found that there was a significant effect between sharia compliance on green banking disclosure practices in Islamic banks in Indonesia and did not find any influence between Islamic corporate governance on financial performance in Islamic banks in Indonesia. Recommendations for further research are to using proxies or other independent variables that have a stronger influence on Islamic banking financial performance, Develop or increase Islamic corporate governance indicators, Extending the reporting period for research samples.

The effect of compliance with AAOIFI standards on financial performance of Islamic banks

Purpose This research study aims to examine the effect of the compliance with the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) standards on the performance of Islamic banks. Design/methodology/approach The sample consists of 628 bank-year observations from eight countries that adopt the AAOIFI standards during the period 2009–2020. Findings The findings reveal a significant positive relationship between the overall compliance level with AAOIFI standards and the two performance measures in Islamic banks. Practical implications The findings are useful for various groups of preparers and users of Islamic banks’ annual reports, such as academics and researchers, accountants, management of Islamic banks and national and international organizations. Originality/value This research provides new empirical evidence on the effect of compliance with AAOIFI standards (accounting and governance) on Islamic banks performance. In addition, the findings reveal that the examination of compliance level should not be restricted to an overall compliance index that contains all the AAOIFI standards, but should rather take into consideration the different types of these standards (accounting and governance).

Moderation Effect Of Islamic Social Reporting On Influences Of Islamicity Performance Index On Financial Performance Of Islamic Banking

This study aims to analyze the effect of the Islamicity performance index on financial performance through Islamic social reporting as a moderating variable. This research uses quantitative methods. This study used purposive sampling to take samples from a total population of 18 Islamic commercial banks (ICB) to obtain five representative ICB samples. The data source uses secondary data in the form of information originating from the official ICB website. Data analysis used multiple linear regression and moderated regression analysis (MRA). The results showed that the zakat performance ratio, Islamic income vs. non-Islamic income ratio, and Islamic social reporting did not affect financial performance. However, the profit-sharing ratio has a significant effect on financial performance. Islamic social reporting can moderate the effect of the profit-sharing ratio on financial performance. However, Islamic social reporting cannot moderate the variable zakat performance ratio and Islamic income vs. non-Islamic income ratio on financial performance. This research can complement existing research and be a reference for ICB management disclosing information to stakeholders by applying Sharia principles.

Zakat As a Corporate Social Responsibility: How Does It Affect the Financial Performance of Islamic Banks?

Islamic banks should actively engage in Corporate Social Responsibility (CSR) activities as part of their moral obligations to contribute to society and surroundings. This study aims to investigate the influence of Zakat contribution, as a proxy of CSR, on the financial performance of Islamic banks in Malaysia. The study used panel-data analysis, whereby the annual reports of 11 local Islamic banks in Malaysia were analyzed over a ten-year period from 2010 to 2019. Fixed- and random-effect regression model analyses were conducted to analyze the results of the study. The findings reveal that there is a positive and significant relationship between Zakat contribution and the financial performance proxied by Return on Asset (ROA) and Return of Equity (ROE) of the Islamic banks in Malaysia. Hence, the findings of the study confirmed the importance of social elements, like Zakat, in the operations of Islamic banks, as well as in the banks’ performance.

Navigating Uncertain Times: Comparative Analysis of Islamic Banking Financial Performance in Indonesia Before and During the Covid-19 Pandemic

This study analyzes the comparison of the financial performance of Islamic banks in Indonesia before and during the Covid-19 pandemic. The population used in this study consists of Islamic Commercial Banks in Indonesia. The research method employed is quantitative research with a comparative approach using IBM SPSS Statistics 25 software. The data used are secondary data in the form of financial reports published by each company's website from 2018 to 2021. The results of this study indicate significant differences in CAR and ROA ratios between before and during the Covid-19 pandemic. However, there are no significant differences in NPF, OER, and FDR ratios between before and during the Covid-19 pandemic. Furthermore, there are significant simultaneous differences in financial performance before and during the Covid-19 pandemic. This comparative analysis sheds light on the dynamic nature of Islamic banking financial performance during the Covid-19 pandemic. The findings provide valuable insights for policymakers, bank regulators, and industry stakeholders in understanding the sector's resilience and the need for adaptive strategies during times of crisis.

The Effect of Intellectual Capital on Financial Performance with Corporate Social Responsibility as Moderating Variable: Studies on Islamic Commercial Banks

This study aims to determine the influence of Intellectual Capital and the moderating of Corporate Social Responsibility to financial performance of Islamic banks. The data in this study used secondary data using the IB reports for the years 2010-2021. The independent variable used is IC as measured by Human Capital Efficiency, Structural Capital Efficiency, and Capital Employed Efficiency, and Corporate Social Responsibility as moderating variable. While the dependent variable used is ROA and ROE as the measure of financial performance. This study uses multiple linear regression analysis with data panel models. The results showed that IC as measured by HCE has positive and no significant effect, SCE has positive and significant effect, and CEE has negative and significant effect on financial performance. and as a moderating variable, CSR negatively weakens the relationship between HCE and SCE and financial performance, while CSR positively strengthens the relationship between CEE and financial performance.

Comparative Analysis of the Financial Performance of Islamic Banks and Conventional Banks During The Covid-19 Pandemic

Comparative Analysis of the Financial Performance of Islamic Banks and Conventional Banks During The Covid-19 Pandemic

EVALUASI KINERJA KEUANGAN PERBANKAN SYARIAH DI INDONESIA MENGGUNAKAN METODE RGEC DAN ISLAMICITY PERFORMANCE INDEX (IPI)

ABSTRACT This study aims to determine the financial performance of Islamic banking in Indonesia using the RGEC method and the Islamicity Performance Index.To find out this, researchers used a descriptive quantitative method with secondary data collection techniques in the form of financial reports that are available on the official website of each Islamic bank for the 2017-2021 period. The samples used were 5 Islamic Banks. The results of financial performance research using the REC method (Risk Profile, Earnings and Capital), namely NPF, FDR, BOPO and CAR show that the five banks are in good condition. However, the Earnings ratio (ROA) of Bank Muamalat Indonesia is considered Not Good with an average percentage of 0.04% and the other four banks are considered Fairly Good with an average percentage of ≥0.05%. The results of the research on financial performance using the Islamicity Performance Index method on the Profit Sharing Ratio show that the four Islamic banks are in good condition and Bank BTPN Syariah is in a bad condition with an average percentage of 0.024% less than 30%. The Zakat Performance Ratio and Equitable Distribution Ratio of the five Islamic banks are stated to be very unfavorable. In Islamic Investment vs. Non-Islamic Investment and Islamic Income vs. Non-Islamic Income, the five Islamic banks are stated to be very good with an average percentage of ≥50.Keywords: Evaluation, RGEC, Islamicity Performance Index

Analysis of the influence of corporate governance on the financial performance of Islamic banks in Indonesia 2016 - 2021

The reason of the cases is to analyze the impacts of ICG (Islamic Corporate Administration) on the monetary execution of Islamic Commercial Banks in Indonesia amid the period of 2017 to 2022 .The population for this study is made up of 15 Islamic Commercial Banks registered with OJK, and a purposive sampling technique is used to choose seven samples. This study employs a descriptive quantitative method by conducting simple regression tests to evaluate the partial impact of ICG regarding the financial results of Islamic banks. The Return on Assets (ROA) proxies the financial performance in this study. Banking in Indonesia is defined by Law No. 10 of 1998 as a business institution that gathers funds in the form of savings from the community and distributes them into financing and other activities that aim to improve the community's welfare. Islamic banks are one of the two types of banking in Indonesia, and they operate based on Shariah principles. The operation of Shariah banking is supported by Law No. 21 of 2008. In recent years, the number of Islamic banks in Indonesia has grown significantly, with a rise in the number of offices, banks, and assets. The research findings demonstrate that ICG very continuous, partially positive results for the Islamic commercial banking sector in Indonesia from 2017 to 2022. Integrating Islamic Corporate Governance principles into Corporate Governance principles shares the same objectives, including transparency and accountability. As a result, Additional exploration is recommended to examine alternative independent variables that could potentially impact the money related execution of Islamic commercial banks. The show investigate underscores the noteworthiness of ICG in expanding the monetary execution of Indonesian Islamic commercial banks.

The Role of Islamic Banks' Financial Performance on Corporate Social Responsibility (CSR)

<p align="justify">This study aims to obtain empirical evidence of factors that can affect the CSR performance of the Islamic social reporting (ISR) index of Islamic banks, which then interact with moderating variables. The method used is a quantitative method with multiple regression techniques and moderated regression analysis used to analyze the data. The factor used is Islamic social reporting, and the moderating variable is financial performance contained in the annual reports of several Islamic banks in Indonesia. From 2012 to 2021, the population of this study is Indonesian Islamic Commercial Banks (BUS). The sample obtained based on the sample selection criteria is only four Islamic commercial banks with a total of only 40 observations, indicating that the sample is still relatively small and the resulting value is relatively low to explain the company's financial performance. The time series method is used to process the data. The result show ROA and ROE can moderate and strengthen the impact of ISR on firm performance, ISR has a favorable and considerable impact on the financial performance of Islamic banks. The added value of the company is supported theoretically and empirically by this study. For this research to be used as a reference to explain phenomena with existing theories, the hypotheses made are stated descriptively and then accompanied by a Sharia perspective.</p>

Innovation Practices and Performance of Islamic Banks in Nairobi-Kenya

Purpose: The dominant feature of the modern financial system is a high pace of innovation practices, both in terms of their number and value. Thus, it is important to analyze their influence on the financial system. The current study aimed at determining the effect of innovation practices on the financial performance of Islamic banks in Kenya. Specifically, the study sought to determine the influence product innovation practices, process innovation practices, technological innovation practices and market innovation practices on the organizational performance of Islamic banks in Kenya. This study was informed by the following theories and models: the innovation diffusion theory of innovation, the Henderson-Clark model of innovation, the Task Technology Fit theory of innovation and the Shareholder’s Wealth Maximization (SWM) Theory.
 Methodology: The study adopted a descriptive research design and targeted 3 Islamic banks in Kenya with a total of 142 managers. The sample selection was scientifically guided using the Yamane (1967) simplified formula to calculate the sample size of 105 respondents. The study used structured questionnaires to collect the data. In order to ascertain how valid and reliable the questionnaires are, a pilot study was carried out. Descriptive statistics was used to collect summary statistics including means and standard deviations while inferential statistics helped in measuring the causal relationship between the variables and included correlation and regression analysis. The generation of the statistics was through SPSS program (v.25.0). The study employed both figures and tables to present the results of the study.
 Findings: The results established that product innovation practices, process innovation practices, technological innovation practices and market innovation practices positively and significantly affect the organizational performance of Islamic commercial banks in Kenya. This is shown by respective beta values of 0.398, 0.311, 0.443 and 0.295 and respective significant values of 0.002, 0.009, 0.000 and 0.01.
 Unique contribution to theory, practice and policy: The results bears the implications that increasing each of the variable with one unit results to increase in organizational performance levels of Islamic commercial banks with respective beta values. The study recommends the Islamic commercial banks operating in Kenya to enhance their product innovation, process innovation, technological innovation and market innovation practices since the practices positively and significantly affects organizational performance.

Factors Affecting the Financial Performance of Islamic Banks in Pakistan

This research aims to evaluate the internal factors influencing the performance of Islamic banks in Pakistan. There are currently five Islamic banks in operation, and data from all five have been used to analyze their performance from 2008 to 2021. The data was collected from the State Bank of Pakistan. To examine financial performance, this study used return on assets (ROA) and returns on equity (ROE) as proxies, and considered both internal attributes (such as liquidity, bank size, asset quality, capital adequacy ratio, operational efficiency, and assets management) and external factors (such as macroeconomic indicators like GDP growth and inflation rate). Ordinary least squares (OLS) estimation is employed to examine the relationship among variables. The estimation findings suggest that all of the internal factors have a strong association with banks' performance. Bank size and asset quality were found to have a positive and significant association with ROA, while asset quality and assets management were associated positively with ROE. Additionally, during the Covid-19 pandemic period, banks' size and liquidity were found to adversely affect ROA of Islamic banks, while operational efficiency had a positive impact.

Implementasi Good Corporate Governance (GCG) pada Pengukuran Resiko dan Kinerja Keuangan Bank Syariah: Studi Kasus Pada Bank Umum Syariah

Good Corporate Governance (GCG) is one of the key elements in increasing economic efficiency that can help create a conducive and accountable relationship between elements of the company (board of commissioners, directors, and shareholders) in order to improve the company's financial performance. This study aims to determine the effect of Good Corporate Governance (GCG) as proxied by managerial ownership, institutional ownership, independent commissioners and sharia supervisory boards in measuring the risk of financial performance of Islamic banks in Indonesia. The results of this study as a whole can be concluded that, Good Corporate Governance (GCG) in measuring the risk and financial performance of Islamic banks has no significant effect.And to evaluate the concept of managing Islamic Commercial Banks in the implementation of Good Corporate Governance based on existing regulations on financial performance and financing risk at Islamic Commercial Banks in Indonesia which are registered with the Financial Services Authority.
 Keywords: GCG, Measurement Risk, Financial Performance, Islamic Banking.

The Influence of the Board of Commissioners, Board of Directors, Sharia Supervisory Board, and Audit Committee on the Financial Performance of Islamic Banking in Indonesia

The Influence of the Board of Commissioners, Board of Directors, Sharia Supervisory Board, and Audit Committee on the Financial Performance of Islamic Banking in Indonesia

The Influence of the Board of Commissioners, Board of Directors, Audit Committee, and Sharia Supervisory Board on the Financial Performance of Islamic Banking (Empirical Study on Islamic Banking in Indonesia 2017- 2021 Period)

The Influence of the Board of Commissioners, Board of Directors, Audit Committee, and Sharia Supervisory Board on the Financial Performance of Islamic Banking (Empirical Study on Islamic Banking in Indonesia 2017- 2021 Period)

Comparative Analysis Of Non-Performing Financing At PT. Bank Syariah Indonesia, TBK (BSI) Before And After The Merger

Three government-owned Islamic banks were merged, namely PT. Bank BRI Syariah, PT. Bank BNI Syariah, and PT. Bank Mandiri Syariah became PT. Bank Syariah Indonesia (BSI) is an effort to improve the financial performance of Islamic banks so that they can be more competitive. This study aims to test and analyze differences in non-performing financing before the merger (2019 quarter II – 2020 quarter IV) and after (2021 quarter I - 2022 quarter III). The sample in this study is the quarterly financial reports of Bank BSI. The analytical method is a descriptive comparative method and uses a paired sample t-test analysis technique. The study results show significant differences in non-performing financing before and after the merger, which indicates that the union influences the risk of problem financing.