COMPARATIVE FINANCIAL PERFORMANCE OF REGIONAL DEVELOPMENT BANKS (BPDS) AND THE BANKING INDUSTRY IN INDONESIA

Roberto Akyuwen, Y. Sri Susilo, Raden Kusumawijaya

Abstract


Regional development banks (BPDs) are essentially designed as regional development agents and dedicated to create employment, alleviate poverty, and reduce disparity at the regional level. In the context of banking operations, BPDs are expected to become regional champions in their respective regions. This expectation can be met only if BPDs are able to compete with the other types of commercial banks and non-bank financial institutions, including rural banks and financial technology companies. This research was aimed at comparing the financial performance of BPDs and the banking industry in Indonesia. A descriptive approach was used to analyze the current secondary data gathered from the Indonesia Financial Services Authority (OJK). The results have shown that, in general, the average financial performance of all BPDs was lower than that of the banking industry. However, the group of smallest BPDs had a higher growth compared to the banking industry.

Keywords: Banking Industry, Financial Performance, Regional Development Banks.

Full Text:

PDF
rticle

References


Adam, M. H. M. (2014). Evaluating The Financial Performance of Banks Using Financial Ratios – A Case Study of Erbil Bank for Investment and Finance. European Journal of Accounting Auditing and Finance Research, 2(6), 162-177.

Akyuwen, R., & Mangowal, C. (2019). Leadership Challenges of Regional Nanks in Indonesia. KINERJA, 23(1), 76-86.

Alex, M. K., & Ngaba, D. (2018). Effect of Firm Size on Financial Performance on Banks: Case of Commercial Banks in Kenya. International Academic Journal of Economics and Finance, 3(1), 175-190.

Allahham, M. I. (2015). Impact of Capital Structure on Bank Financial Performance of Al Ahli Bank in Saudi Arabia. International Letters of Social and Humanities Sciences Online, 60, 10-16.

Chandulal, G. A. (2016). A Comparative Study on Financial Performance of Private and Public Sector Banks with Special Reference to Affecting Factors and Their Impact on Performance Indicators. Dissertation. Gujarat Technological University.

European Central Bank. (2010). Beyond ROE – How to Measure Bank Performance – Appendix to The Report on EU Banking structures. Frankfurt.

Haque, A. (2014). Comparison of Financial Performance of Commercial Banks: A Case Study in The Context of India (2009-2013). Journal of Finance and Bank Management, 2(2), 1-14.

Ongore, V. O., & Kusa, G. B. (2013). Determinants of Financial Performance of Commercial Banks in Kenya. International Journal of Economics and Financial Issues, 3(1), 237-252.

Nagarkar, J. J. (2015). Analysis of Financial Performance of Banks in India. Annual Research Journal of Symbiosis Center for Management Studies, 3, 26-37.

Nyanga, O. V. (2009). Determinants of Financial Performance of Commercial Banks in Kenya. Thesis. Master of Business Administration, School of Business, University of Nairobi.

Murerwa, C. B. (2015). Determinants of Banks’ Financial Performance in Developing Economies: Evidence from Kenyan Commercial Banks. Thesis. Master of Business Administration, United States International University – Africa.

Nuhiu, A., Hoti, A., & Bektashi, M. (2017). Determinants of Commercial Bank Profitability Through Analysis of Financial Performance Indicators: Evidence from Kosovo. Busines: Theory and Practice, 18, 160-170.

Peraturan Otoritas Jasa Keuangan Nomor 6/POJK.03/2016 tentang Kegiatan Usaha dan Jaringan Kantor Berdasarkan Modal Inti Bank.

Raza, A., Farhan, M., & Akram, M. (2011). A Comparison of Financial Performance in Investment Banking Sector in Pakistan. International Journal of Business and Social Science, 2(9), 72-81.

Tomuleasa, I. & Cocris, V. (2014). Measuring The Financial Performance of The European Systemically Important banks. Financial Studies, 4, 31-51.




DOI: https://doi.org/10.20961/aedc.v4i1.42557

Refbacks

  • There are currently no refbacks.


Copyright (c) 2020 Journal of Applied Economics in Developing Countries



Journal of Applied Economics in Developing Countries
Master of Economics and Development Studies, Faculty of Economics and Business
Universitas Sebelas Maret
Jl. Ir Sutami 36 A Surakarta, 57126 Indonesia
Telp: +62271-647481
Email: jurnalaedc@gmail.com