The Influence of Bank Health Level with RGEC on Bank Financial Performance
Agus Tri Basuki *
Universitas Muhammadiyah Yogyakarta, Indonesia.
Nadia Sabilla
Universitas Muhammadiyah Yogyakarta, Indonesia.
*Author to whom correspondence should be addressed.
Abstract
This study aims to analyze the effect of Bank RGEC's health indicators on bank financial performance at commercial banks listed on the Indonesia Stock Exchange (IDX). In this study, a sample of 43 banks was used. The sampling method in this study used a purposive sampling technique. The analysis technique used in this study uses dynamic panel data analysis Error Correction Model. The results of the analysis that has been carried out show that Non Performing Loans (NPL) have a negative and significant effect on bank financial performance (ROA), Good Corporate Governance does not have a significant effect on bank financial performance (ROA), Net Interest Margin (NIM) has a positive influence and significant to the bank's financial performance (ROA), and the Capital Adequacy Ratio (CAR) has no significant effect on the bank's financial performance (ROA).
Keywords: Indonesia stock exchange, error correction model, return on assets, bank health indicators