FACTORS INFLUENCING THE FINANCIAL PERFORMANCE OF ISLAMIC RURAL BANKS IN INDONESIA
Abstract
The purpose of this research is to determine the factors influencing the performance of Islamic rural banks in Indonesia. This study is an attempt to explore the implications of the COVID-19 pandemic for the banking industry in Indonesia. As we know, banks in developing countries are more vulnerable to these external and massive threats. Therefore, it is very important to study their performance in the era before and during COVID-19, The population of IRB in this study were 163 companies. Because the data was incomplete and not available on the company's website, the sample could not be taken from all populations. so that there are 74 data that meet the criteria for being sampled because they have the most complete financial reports and have been published in the 2018-2021 period. The results of the study show that the dummy variable COVID-19 has no effect on the financial performance of Islamic Rural Banks. COVID-19 has not had an impact on IRB performance due to the segmentation of IRB consumers, mostly rural communities who have income from agriculture, plantations, and trade. These efforts did not have an impact on reducing the income of IRB consumers during the COVID-19 period. Thus, COVID-19 will not have an impact on the financing that has been distributed by the IRB. OCOI and SIZE variables affect financial performance. Meanwhile, the CAR, FDR and NPF variables have no effect on the financial performance of Islamic Rural Banks.
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