Examining the Effect of Economic Collison

Abstract

This study will examine the impact of economic collision on the non-performing financing in sharia bank in Indonesia. The current study adopts VAR/VECM method to examine inter variables correlation by testing an economic factors, including 1) Real GDP Growth, 2) Exchange Rate, 3) Inflation, 4) Interest Rate, and 5) IDX Composite. A total NPF of 14 Islamic Banks and 20 Sharia Business Units were selected as data samples from 2006 to 2020. The findings indicate that inflation positively impacts NPF in the short run and delivers the biggest shock to NPF. The result states that Inflation, Exchange rate, and Interest rate are the dominant factors to shock NPF in Islamic Banks. From the analysis results, the economic variables, i.e., GDP, exchange rates, inflation, interest rates, and the IDX Composite, provide a stable long-term relationship and, in the short term, adjust to each other to achieve a new balance in the long term.

Keywords: {'name': 'Banking'}, {'name': 'Credit Performance'}, {'name': 'Economic Factor'}

Authors & affiliations

Ardhiani Fadila
Affiliation not supplied

Dewi Cahyani Pangestuti
Affiliation not supplied

Deposited references

Supplied references, not a list of publications citing this article.

DOI: 10.1016/j.jimonfin.2017.09.003

DOI: 10.1108/QRFM-09-2016-0029

DOI: 10.1016/j.qref.2019.04.005

DOI: 10.1080/23322039.2019.1616521

DOI: 10.21511/bbs.12(3).2017.10

Amzal, C. (2016). THE IMPACT OF MACROECONOMIC VARIABLES ON INDONESIA ISLAMIC BANKS PROFITABILITY ARTICLE HISTORY. In Jurnal Ekonomi dan Bisnis Islam (Vol. 2, Issue 1). http://dx.doi.org/10.20473/jebis.v2i1.1968

Apriadi, I., Sembel, R., Santosa, P., & Firdaus, M. (2016). Banking fragility in Indonesia: A panel vector autoregression approach. International Journal of Applied Business and Economic Research, 14, 1193–1224.

DOI: 10.1111/twec.12507

DOI: 10.1016/j.pacfin.2020.101351

DOI: 10.1016/j.jinteco.2018.10.002

Bernanke, B. S., & Blinder, A. S. (1992). The Federal Funds Rate and the Channels of Monetary Transmission. The American Economic Review, 82(4), 901–921. http://www.jstor.org/stable/2117350

DOI: 10.1016/j.ribaf.2013.08.001

DOI: 10.14414/jebav.v24i1.2474

DOI: 10.1016/j.gfj.2019.100478

Caroline Barus, A. (2016). ANALISIS FAKTOR-FAKTOR YANG MEMPENGARUHI NON PERFORMING LOAN PADA BANK UMUM DI INDONESIA. In Jurnal Wira Ekonomi Mikroskil (Vol. 6).

DOI: 10.1016/j.cbrev.2017.02.003

DOI: 10.21511/bbs.15(1).2020.03

DOI: 10.1108/JIABR-08-2017-0114

Filip, F. B. (2017). LESSONS FROM THE IMPACT OF INTERNAL AND MACROECONOMIC DETERMINANTS OF BAD LOANS IN CEE BANKS.

DOI: 10.1016/j.ribaf.2017.09.004

DOI: 10.1016/j.asieco.2016.06.004

DOI: 10.33830/jom.v15i2.733.2019

DOI: 10.1016/j.irfa.2017.02.006

DOI: 10.1016/j.pacfin.2015.06.001

DOI: 10.21043/iqtishadia.v10i2.2864

DOI: 10.33830/jom.v15i2.733.2019

DOI: 10.1016/j.qref.2018.05.009

DOI: 10.2478/ajis-2019-0020

DOI: 10.1016/S1574-0684(05)01012-9

DOI: 10.1016/j.red.2018.05.002

DOI: 10.20525/ijfbs.v10i1.1032

DOI: 10.1016/j.ribaf.2016.03.014

DOI: 10.1016/j.ribaf.2020.101230

DOI: 10.1016/j.qref.2015.10.004

OJK. (2021). Laporan Profil Industri Perbankan - Triwulan I 2021.

Popita, A. S. M. (2013). ANALISIS PENYEBAB TERJADINYA NON PERFORMING FINANCING PADA BANK UMUM SYARIAH DI INDONESIA. Dipublikasikan. http://journal.unnes.ac.id/sju/index.php/aaj

DOI: 10.31949/maro.v4i2.1189

DOI: 10.1108/IJIF-09-2019-0134

DOI: 10.14421/grieb.2019.072-03

DOI: 10.17015/ejbe.2017.020.07

DOI: 10.1016/j.jcorpfin.2018.08.009

Sakiru Adebola, S., Sulaiman Wan Yusoff, W., & Dahalan, J. (2011). AN ARDL APPROACH TO THE DETERMINANTS OF NON-PERFORMING LOANS IN ISLAMIC BANKING SYSTEM IN MALAYSIA. In Arabian Journal of Business and Management Review (Vol. 1, Issue 2).

DOI: 10.1016/j.aebj.2018.09.003

DOI: 10.15408/etk.v19i2.15528

DOI: 10.1016/j.irfa.2017.04.005

DOI: 10.2307/1912017

DOI: 10.1016/j.heliyon.2019.e03141

DOI: 10.1016/j.ribaf.2017.07.013

DOI: 10.1016/j.bir.2018.09.001

DOI: 10.1016/j.heliyon.2020.e04472