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Financial Performance and Bank Efficiency: Comparison Between Conventional Banks and Sharia Banks

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Financial Performance and Bank Efficiency: Comparison Between Conventional Banks and Sharia Banks
FINANCIAL PERFORMANCE AND BANK EFFICIENCY: COMPARISON BETWEEN CONVENTIONAL BANKS AND SHARIA BANKS

RESEARCH JOURNAL Presented as a Partial Fulfillment of the Requirements to Obtain The Bachelor Degree in Management Department

Written by: DINDA RIZKY NUR FEBRIANY Student Number: 09311057

DEPARTMENT OF MANAGEMENT INTERNATIONAL PROGRAM FACULTY OF ECONOMICS UNIVERSITAS ISLAM INDONESIA 2013

FINANCIAL PERFORMANCE AND BANK EFFICIENCY: COMPARISON BETWEEN CONVENTIONAL BANKS AND SHARIA BANKS Dinda Rizky Nur Febriany Universitas Islam Indonesia dindarizkynf@yahoo.com

ABSTRACT

This study aims to compare the financial performance and bank efficiency between conventional banks and sharia banks in Indonesia in the period of 2008-2011 by using financial ratios to measure the financial performance, as well as SFA (Stochastic Frontier Approach) to the measure bank efficiency. Financial ratios that are used are consisted of CAR, NPL, ROA, ROE, and LDR. Meanwhile variables that are used to measure the efficiency are receivables, placements with Bank Indonesia and other banks, third-party funds, and issued capital and fully paid capital. The samples consist of 11 conventional banks and 11 sharia banks. T-test is conducted to determine whether there is any significant difference in financial performance between sharia Banks and conventional Banks. The results of hypothesis testing and multiple regression analysis indicate that there are significant differences of CAR, ROA, ROE, profit efficiency between conventional banks and sharia banks. Keywords: financial performance, bank efficiency, SFA, conventional banks, sharia bank.

ABSTRAK Penelitian ini bertujuan untuk melakukan perbandingan kinerja keuangan serta efisiensi Bank Umum Konvensional dan Bank Umum Sharia di Indonesia pada periode 2008-2011 dengan menggunakan rasio keuangan untuk mengukur kinerja keuangan, serta SFA (Stochastic Frontier Approach) untuk mengukur efisiensi bank. Rasio keuangan yang digunakan terdiri dari


References: Abustan. (2009). Analisa Perbandingan Kinerja Keuangan Perbankan Sharia dengan Perbankan Konvensional, Retrieved December 24, 2012, from : http://docs.google.com/viewer?a=v&q=cache:_eUXttjW3VgJ:www.gunadara.ac.id/librar y/articles/graduate/economy/2009 Alphonsius, W. & Tanko, M. (June 24, 2008). CAMELs and Banks Performance Evaluation: The Way Forward. Social Science Research Network. Retrieved April 15, 2012, from http://ssrn.com/abstract=1150968 Endang Sumachdar and Hariandy Hasbi. (2010). Financial Performance Analysis for Islamic Rural Bank to Third Party Funds and The Comparation with Conventional Rural Bank in Indonesia. International Conference on Business and Economics Research. Retrieved April 18, 2012, from http://www.ipedr.com/vol1/67G00011.pdf Mohd, I., Mazlina, N., Haron, S. (February, 2010). Cost and Profit Efficiency of the Malaysian Commercial Banks: A Comparison between Domestic and Foreign Banks. International Journal of Economics and Finance. Retrieved October 22, 2012, from www.ccsenet.org/ijef Sujarweni, V.W. (2007). Panduan Mudah Menggunakan SPSS dan Contoh Penelitian Bidang Ekonomi. Yogyakarta: Ardana Media Viverita (2011). Performance Analysis of Indonesian Islamic and Conventional Banks. Social Science Research Network. Retrieved December 24, 2012, from http://ssrn.com/abstract=1868938
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