Regional Development Banks Research Articles

THE DETERMINANTS OF MALUS ON REGIONAL DEVELOPMENT BANK IN INDONESIA

Abstract— This study is based on the Indonesian Financial Service Authority since 2015 regulates that banks must have a policy to defer, or to clawback, or combination of both the variable compensation paid to bank’s executive. Since the Indonesian Financial Authority allows banks to choose their compensation scheme, this study is to investigate the factors that influence the choice of the policy. Our study is among few studies that investigate this area because the regulation was enacted in 2017. Data are collected from Regional Development Bank in Indonesia that report their compensation policy since 2017 to 2019. We test financial and nonfinancial factors that may determine the choice of compensation policy. Banks with lower net interest margin tend not to choose malus. The similar conclusion is also given by the variable board of commissioner’s tenure. However, commissioner’s remuneration suggests a positive relationship with the propensity to choose malus other than other type of compensation policies. We find that net interest margin, board of commissioners tenure, and remuneration of executives are related to choice of clawback or malus. Future researchers may focus on the effect of corporate governance related to local governments-owned banks and remuneration provisions.
 Keywords: Clawback; Compensation; Corporate Governance; Holdback; Malus

Analisis Kesehatan Bank Jatim Di Era Pandemi

This research aimed to test whether there were differences in the level of banking soundness before and during Covid-19 at PT. Bank Pembangunan Daerah Jawa Timur Tbk. (East Java Regional Development Bank or Bank Jatim) during 2016–2021. This research is quantitative descriptive research without testing the hypothesis. This study measures the soundness of banks using the RGEC method (risk profile, good corporate governance, earnings, and capital). The results of this study provide empirical evidence that during the Covid-19 pandemic, namely 2020-2021 and 2019-2020 (before Covid-19) the performance of the East Java Regional Development Bank had a very healthy level of health in terms of the ratio of LDR, LAR, CAR, NIM, while the CR ratio before the pandemic at a healthy level rose to very healthy and in 2021 decreased again with a healthy predicate, while the NPL ratio did not change to a good predicate, while the IRR ratio decreased to unhealthy. The ROA ratio also decreased from very healthy to be healthy, while GCG increased in 2021 to be good from those in 2019 and 2020 which were quite good.

Pengaruh Kepuasan Kerja, Disiplin Kerja dan Kompensasi Terhadap Kinerja Karyawan PT. Bank Pembangunan Daerah Jawa Timur

This research was carried out with a quantitative approach and used the SPSS version 22 statistical program. The research significance level was 0.003, below the limit of 0.05. The main objective of this research is to determine how job satisfaction, work discipline, and compensation impact the performance of individuals and groups of employees at PT. East Java Regional Development Bank. This research involved 40 employees from PT. East Java Regional Development Bank. The results of the analysis show that job satisfaction and work discipline influence the performance of PT employees. Bank Jatim.

An In-Depth Analysis of Credit, Capital, and Operational Risks on Regional Development Banks' Performance Amidst the Covid-19 Pandemic

The Covid-19 pandemic has hit the world since the end of 2019 and has damaged the world economy, including Indonesia. Banking as a financial institution that provides funding to companies is also affected. Because the pandemic has reduced the company's performance, and this decline in performance has had an impact on banking. The aim of this research is to test whether the Covid-19 pandemic has an impact on the relationship between risk factors and bank performance. Bank performance is measured by profitability which consists of return on assets (ROA) and return on equity (ROE), while bank risk in this study consists of credit risk, liquidity risk, capital, operational risk and the Covid-19 pandemic. The population in this research is the Regional Development Banks (BPD) in Indonesia totaling 34 banks with a sample of 30 banks. The observation period was 4 years with quarterly data so that 320 observation data were collected. Hypothesis testing uses panel data regression, and to select the best regression model, the model will be tested using the Chow-test, Hausman-test, and Lagrange Multiplier test. After the model test was carried out, the fixed effect model was selected as the best model. The research results show that credit risk and operational risk have a significant and negative influence on all profitability, both ROA and ROE. Meanwhile, liquidity risk (LDR) has no effect on both types of profitability, while capital has an effect on ROE but has no effect on ROA. Another interesting result is that the Covid-19 pandemic has no impact on the influence of risk on bank performance.

Exploring the Nexus Between E-Banking, Credit Provision, and Shareholder Dividends in Regional Development Banks

This exploration aims to test and dissect factors that impact bank fiscal performance and their impact on shareholder tips. The variables used are E-Banking, credit handed as an independent variable, and ROE as a dependent variable. This exploration also looks at the influence of ROE on shareholder tips proxied by the DPR. This exploration was conducted in all BPDs in Sumatra, there are 8 BPDs registered with the OJK during the 2019 – 2022 period. The exploration system used was descriptive exploration with a quantitative exploration approach. Data recycling analysis uses multiple and simple retrogression analyses. The exploration results show that E-Banking and the credit handed have a significant influence on ROE, both concertedly and collectively. Meanwhile, fiscal performance (ROE) also influences shareholder tips (DPR).

Gender and the Multilateral Development Banks: From WID to GAD to Retroliberal WID

Multilateral development bank (MDB) engagement with ‘gender’ is controversial in review and uneven in practice. The authors analyse 1,928 gender-focused projects financed by the World Bank and regional development banks between 1967 and 2021. We propose three eras into which MDB gender engagement divides and argues that isomorphic pressures have aligned their approaches. The article concludes that gender is not an investment priority and projects have conceptually narrowed over time to focus on private entrepreneurship at the expense of addressing systemic gendered inequalities. This is significant for what the MDB finance signals to investors the feasibility of development projects.

Fraud Prevention Analysis: Perceptions of Bank Sumsel-Babel Employees

If a nation’s financial statements are stable and exist, and the financial system is stable, banking companies can contribute to economic growth. The growth or development of the banking world is not only dominated by certain banks such as BUMN Banks or Private Banks. However, this is also experienced by Regional Development Banks. In several cases in banking, Fraud occurs due to internal processes (human error), system failures, or external errors. This research uses a quantitative research method with a questionnaire observation approach, with the object respondents being Bank Sumsel-Babel employees, totaling 238 respondents and 34 question instruments—Smart-PLS analysis technique. Of the 32 indicators (2 indicators omitted), in the outer measurement model, data has validity and reliability with the approach that has been achieved. At the same time, in the inner path coefficient test model, all variables are negative with a value <- 420 (weak category). Meanwhile, at the R-square level of 0.688 (moderate), it can create a goodness of fit, robust value, and an accuracy of 95.0%. The estimation results show that all variables have a negative direction coefficient that significantly affects compensation, competence, and internal control of Fraud. At the same time, organizational culture, with a value of 0.138 > 0.05, indicates no effect on Fraud.

Os Bancos de Desenvolvimento multilaterais, nacionais e subnacionais: os países emergentes e o financiamento ao desenvolvimento

Development Banks are financial institutions designed to promote socioeconomic development, infrastructure, reduce inequalities and provide working capital to increase the country’s economic activity. Brazil stands out for the presence of three national development banks: (i) National Bank for Economic and Social Development (BNDES); (ii) Bank of the Northeast of Brazil (BNB); and (iii) Bank of the Amazon (BASA). In addition, there are three subnational banks: (i) Minas Gerais Development Bank (BDMG); (ii) Regional Development Bank of the Far South (BRDE), and the Espírito Santo Development Bank S.A. (BANDES). At the international level, two major groups of multilateral development banks are recognized: (i) the traditional banks that were created in the second half of the 20th century, such as the World Bank, the Inter-American Development Bank (IDB), the Asian Development Bank (ADB), the European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB); and (ii) the new multilateral banks, created in the 21st century at the initiative of emerging countries, such as the New Development Bank (NDB) or Bank of the BRICS, the Latin American Development Bank or Andean Development Cooperation (CAF) and the Asian Infrastructure and Investment Bank (AIIB). Emerging countries, either by creating national and subnational banks or by taking the initiative to establish new multilateral banks, represent an important group of states to contribute to increasing of investment availability for development and infrastructure.

The Determinant of Regional Development Bank’s Profitability in Indonesia

Regional Development Bank (RDB) is a Regional Owned Enterprise where the majority of ownership is owned by the provincial government and district or city governments within the province which have an important role in regional development and improving the economy of regional communities. The aim of this research is to analyze the factors that affect RDB profitability in Indonesia. The profitability of RDB in this research consists of net interest margin (NIM) and return on assets (ROA). Meanwhile, bank specific variables include bank size (SIZE), fee-based income (FEE), market power (LG), capital adequacy ratio (CAR), non-performing loans (NPL), management efficiency (BOPO), and loan to deposit ratio. (LDR). The data used consists of 24 regional development banks in Indonesia from 2018 to 2022. The results of panel data analysis with random effect model show that there are two bank-specific factors that have a significant affect NIM namely LDR and BOPO. This is in line with the factors that affect ROA, where LDR and BOPO have a significant affect ROA. LG, CAR, and NIM also contribute to the high ROA of RDB in Indonesia. These empirical results can provide an overview of the determinant factors that influence RDB profitability and how RDB management strategies are used to maintain profitability. Apart from that, the Financial Services Authority (OJK) is able to encourage the government to increase capital in RDB. As well as encouraging RDB to increase credit distribution thereby increasing interest charges. Keywords: Regional Development Banks, Profitability, Net interest Margin.

Analisis Pengaruh Risiko Pasar, Risiko Kredit, Risiko Likuiditas dan Risiko Operasional terhadap Kinerja Keuangan Perbankan pada Bank Pembangunan Daerah

Profitability is the bank's ability to gain profits through efficient use of assets. High bank profitability shows good bank performance. This research aims to determine the effect of Loan to Deposit Ratio (LDR), Non-Performing Loans (NPL), Operational Costs, Operating Income (BOPO), and Net Open Position (PDN) on Profitability as measured by Return on Assets (ROA) of Regional Development Banks (BPD) in Indonesia. This research took a sample of BPDs that had complete annual financial reports at the Financial Services Authority for the 2018-2021 period, namely 10 BPDs. Panel data regression analysis (combination of cross section and time series) Random Effect Model. The research results show that LDR has a positive and significant effect on ROA as hypothesized by theory. Likewise, BOPO has a negative and significant effect on ROA as hypothesized by theory. Meanwhile, NPL and PDN do not have a significant effect on ROA. This can be interpreted as meaning that the risk has less influence on BPD's operations as a regional government banking bank.

Pengaruh Kinerja Perbankan dan Makro Ekonomi terhadap Stabilitas Perbankan pada Bank Pembangunan Daerah di Indonesia tahun 2017-2022

The financial sector depends on banking as a source of the country's economy. Suppose healthy banking conditions and intermediation functions are maintained well. In that case, the money circulation process and monetary policy transmission mechanisms in the economy, mainly through the banking system, will also run well. This research aims to analyze the influence of banking performance and macroeconomic factors on banking stability in Indonesia during 2017-2022. Banking performance factors are LDR, NPL, and CAR, while GDP, inflation, and BI7DRR are macroeconomic factors. This research uses STATA version 17 software, and data is collected using static panel and dynamic panel data. The sample in this study used a purposive sampling technique and obtained 24 regional development banks. This research found that NPL and LDR did not influence banking stability in Indonesia. In contrast, CAR and inflation had a positive and significant impact, and the BI7DRR and GDP variables had a negative and significant influence on banking stability.

Individual Performance on Self-Efficacy and Oranization Commitment Mediated by Job Satisfaction During the Covid-19 Pandemic

This study aims to analyze the effect of: (1) individual performance on self efficacy, (2) individual performance on organizational commitment, (3) individual performance on job satisfaction, (4) job satisfaction on self efficacy (5) job satisfaction on organizational commitment, (6) individual performance on self efficacy through job satisfaction, (7) individual performance on organizational commitment through job satisfaction. This research was conducted at the Bali Regional Development Bank Singaraja Branch Office using an explanatory research approach with a saturated sample obtained by 40 employees. Data collected by questionnaire method is given directly to respondents, then analyzed using path analysis. However, previously tests of validity, reliability and classical assumption tests were carried out. His hypothesis was tested with the 1-test and to determine his mediating role the Sobel test was used. The results concluded that, all hypotheses proposed were accepted, namely: (1) individual performance has a positive effect on self efficacy, (2) individual performance has a positive effect on organizational commitment, (3) individual performance has a positive effect on job satisfaction, (4) job satisfaction has a positive effect on self efficacy, (5) job satisfaction has a positive effect on organizational commitment, (6) individual performance has a positive effect on self efficacy through job satisfaction, (7) Individual performance positively affects organizational commitment through job satisfaction.

Pengaruh Koneksi Politik, Direksi Luar Perusahaan, Komisaris Independen dan Gender Direksi terhadap Kinerja Bank Pembangunan Daerah: Inovasi Keuangan sebagai Variabel Moderasi

This research is intended to examine the influence of political connections, outside directors, independent commissioners and gender of directors on the performance of regional development banks with financial innovation as a moderating variable. The object in this study is the 2017-2021 Regional Development Bank (BPD). The total sample in this study was 26 BPD. The analytical method used in this research is to carry out Partial Least Square (PLS) analysis assisted by the SmartPLS 3.0 program. The findings show that political connections have no effect on BPD performance, outside directors have a negative and significant effect on BPD performance, independent commissioners have no effect on BPD performance, directors' gender has a positive and significant effect on BPD performance, financial innovation does not moderate the influence of political connections on BPD performance, financial innovation moderates the influence of outside directors on BPD performance, financial innovation moderates the influence of independent commissioners on BPD performance, and financial innovation does not moderate the influence of directors' gender on BPD performance. It is hoped that the results of this research can contribute to academics in adding to the literature regarding the financial performance of Regional Development Banks (BPD) and also increase insight for companies in improving financial performance.

Banking Profitability: How do the banking intermediary, secondary reserve, operational efficiency, and credit risk effect?

Objective – A Bank is a financial institution that collects and distributes funds to the public to obtain Profitability. The Covid-19 pandemic has affected the economic sector, especially the banking sector. The intermediation function needs to run optimally, increasing investment in secondary reserves, decreasing operational efficiency, increasing credit risk, and reducing bank profitability. The research aimed to determine the effect of Banking Intermediation, Secondary Reserves, Operational Efficiency, and Credit Risk on Profitability at Regional Development Banks in Indonesia for the 2019 – 2022 period, partially and simultaneously. Banking Intermediation is measured by the ratio of credit to total third-party funds (Loan to Deposit Ratio/LDR), Secondary Reserve is measured by the percentage of securities held to third-party funds (TPF), Operational Efficiency is measured by the ratio of operating expenses to operating income (OEOI), Credit Risk is measured by Non-performing Loans (NPLs), and Profitability is measured by Return on Assets (ROA). Methodology – Descriptive and verification methods with a quantitative approach will be used in this study with secondary data from published financial reports from 22 Regional Development Banks in Indonesia. The data analysis technique used is multiple linear regression. Findings – The study's findings show that partially LDR has a positive and significant effect on ROA; Secondary reserve has a positive but not significant impact on ROA; OEOI and NPLs ratios have a negative and significant effect on ROA. While simultaneously, LDR, Secondary Reserve, OEOI Ratio, and NPLs substantially impact ROA. Novelty – Compared to previous studies, bank profitability is not only influenced by banking intermediation, operational efficiency, and credit risk but also by secondary reserves, although not significantly. Type of Paper: Empirical JEL Classification: G21, G32 Keywords: Banking Intermediation, Banking Profitability, Credit Risk, Operational Efficiency, Secondary Reserve. Reference to this paper should be made as follows: Buchory, H.A. (2023). Banking Profitability: How do the banking intermediary, secondary reserve, operational efficiency, and credit risk effect?, J. Fin. Bank. Review, 8(2), 85 – 96. https://doi.org/10.35609/jfbr.2023.8.2(1)

Position of Regional Development Banks as Regional Owned Enterprises

Regional-owned enterprise is a business entity established by a local government with the purpose of increasing local own-source revenue, where one of the commonly found regional-owned enterprises is a regional-owned enterprise engaged in financial service institutions. The problem that arises for regional owned enterprises engaged in financial service institutions is the overlapping provisions of the laws and regulations that govern them, so this causes legal uncertainty over the position of the Bank. So, to find out the legal certainty of the position of regional development banks, normative legal research methods are used, namely research that uses a statutory approach where the research is carried out on the provisions of the legal aspects of regional-owned enterprises, and aspects of banking law, including the legal aspects regarding limited liability companies.

Analisis Pengaruh Indikator Keuangan dan Makro Ekonomi terhadap Profitabilitas Bank Pembangunan Daerah di Masa Sebelum dan Selama Pandemi Covid-19

This study aims to see the effect of NPL, LDR, CASA, GRDP and inflation on the profitability of 26 (twenty six) Regional Development Banks (BPD) throughout Indonesia which were presented in the form of ROA ratios for the period before the Covid pandemic in 2016 to 2019 and during the Covid pandemic from 2020 to 2021. The descriptive research method uses a quantitative approach with the data analysis method used i is panel data regression analysis. The type of data used is secondary data sourced from published financial reports of BPDs throughout Indonesia on the websites of each BPD, the Central Bureau of Statistics and Bank Indonesia. This research got partial results before the Covid pandemic; NPL has a significant negative effect on ROA, LDR has no significant positive effect on. CASA has no significant positive effect on ROA. GRDP has no significant positive effect on ROA. Inflation has no significant negative effect on ROA. Simultaneously NPL, LDR, CASA, GRDP and inflation have a significant effect on ROA. Partial research results during the Covid pandemic; NPL has no significant negative effect on ROA. LDR has no significant positive effect on ROA. CASA has no significant positive effect on ROA. GRDP has no significant positive effect on ROA. Inflation has no significant negative effect on ROA. Simultaneously NPL, LDR, CASA, GRDP and inflation have no significant effect on ROA.

The Effect of Banking Intermediation, Secondary Reserve, Operational Efficiency, and Credit Risk on Banking Profitability (Study at Regional Development Banks in Indonesia Period 2019 – 2022)

Banks are intermediary financial institutions that collect and distribute funds to the public with the aim of obtaining profitability. The occurrence of the Covid-19 pandemic has affected the economic sector, especially the banking sector. The intermediation function is not running optimally, increasing investment in the form of secondary reserves, decreasing operational efficiency, increasing credit risk, and decreasing bank profitability. This research was conducted with the aim of knowing the effect of Banking Intermediation, Secondary Reserves, Operational Efficiency, and Credit Risk on Profitability at Regional Development Banks in Indonesia for the 2019 – 2022 period both partially and simultaneously. Banking Intermediation is measured by the ratio of credit to total third-party funds (Loan to Deposit Ratio/LDR), Secondary Reserve is measured by the ratio of securities held to third-party funds (TPF), Operational Efficiency is measured by the ratio of operating expenses to operating income (OEOI), Credit Risk is measured by Non-performing Loans (NPLs) and Profitability is measured by Return on Assets (ROA). The research method used is a descriptive method and a verification method with a quantitative approach with secondary data types sourced from published financial reports from 22 Regional Development Banks in Indonesia. The data analysis technique used is multiple linear regression with the classical assumption test first. As for testing the hypothesis used by T-Test and F-Test. The results of the study show that partially LDR has a positive and significant effect on ROA; Secondary reserve has a positive but not significant effect on ROA; OEOI and NPLs ratios have a negative and significant effect on ROA. While simultaneously LDR, Secondary Reserve, OEOI Ratio, and NPLs have a significant effect on ROA. Keywords: Banking Intermediation, Credit Risk, Operational Efficiency, Return on Assets, Secondary Reserve.

STRATEGY EDUCATION TO INCREASE BANK BPD BALI'S ASSET GROWTH THROUGH ITS ABILITY AS AN AGENT OF REGIONAL DEVELOPMENT

Global economic growth is anticipated to slow in 2023 from 2022, accompanied by rising inflationary pressures, aggressive monetary policy rate hikes, and financial market uncertainty. This growth must be independent of the bank's role as an economic body that supervises, accumulates, and distributes monies to the public through deposits. Regional Development Bank (BPD) is a banking entity created by a local government with total shareholders or a fraction of shares controlled by the local government. The challenge is that the growth rate of commercial bank assets in Bali is larger than BPD Bali Bank. One of the actions that may be done is to carry out a strategy to create capacity as an agent of regional development. Briefing and learning activities allow organizations to become more aware of the importance of implementing ways to improve the growth of company assets. This activity is planned to follow up the implementation of the capability-building strategy as an agent of regional development in increasing the growth of Bank BPD Bali's assets so that asset growth increases optimally.

PENGARUH AKTIVA TETAP DAN MODAL TERHADAP LABA BERSIH PADA BANK PEMBANGUNAN DAERAH YANG LISTING DI BURSA EFEK INDONESIA

This study analyzes the impact of fixed assets and capital on net gain from Regional Development Bank listed on the IDX from 2015 to 2019. This study uses an associative method, namely with the intention of finding out what causes the relationship between variables. The approach used is quantitative which consists of numbers to be measured by statistics that act as a data analysis tool. This research data is data or information obtained by researchers indirectly or commonly referred to as secondary data. This study looked at the Regional Development Banks listed on the IDX, including the Regional Development Bank of East Java Tbk (BJTM), Regional Development Banks of West Java (BJBR) and Banten Regional Development Bank Tbk (BEKS). This study used a data analysis technique called Multiple Linear Regression Analysis, which is a test used to check if a data set is Normally Distributed. In addition, testing the hypothesis so that the effect of variable independent on variable dependent partially or simultaneously can be known its significance. The data were analyzed using the IBM SPSS Statistics program.

Aplikasi Handling Problem Unit IT Infrastruktur Divisi Teknologi Dan Sistem Informasi Pada Bpd Sumsel Babel Berbasis Website

The Regional Development Bank (BPD) of South Sumatra and Bangka Belitung (Sumsel Babel) is a financial institution with a complex and important IT infrastructure system in its operations. The purpose of this research is to develop an application that can help in handling these problems. The method used in this research is the waterfall method which consists of requirements analysis, design, implementation, testing, and maintenance. The proposed solution design is a website-based problem handling application. This application will provide access to the IT Infrastructure Team to submit problem reports and monitor repair status in real-time. Additionally, this application will also be equipped with user management features, access rights management, and notification systems that will inform users of repair status. It is hoped that with this application, the efficiency and effectiveness of IT infrastructure problem handling can be better, thus speeding up response time in problem solving and increasing customer satisfaction. In conclusion, the use of website-based problem handling applications at the Regional Development Bank (BPD) of South Sumatra and Bangka Belitung (Sumsel Babel) can help improve the performance of the IT infrastructure unit of the Technology and Information Systems Division, thereby expected to better meet user needs.