Analisis Profitabilitas Bank Pembiayaan Rakyat Syariah di Indonesia: Apakah Kepemilikan Manajemen Berpengaruh?

Abstract

Islamic banking industry in Indonesia is experiencing the rapid growth, but research related to Islamic financial institutions in Indonesia is still limited. In analyzing profitability , management ownership has an important role because it can overcome the problem of agency conflict and reduce agency costs. Therefore, this study aims to examine the effect of management ownership on profitability of Islamic rural banks (BPRS) in Indonesia. To achieve this objective, this study analyzes quarterly panel data of financial report from 155 BPRS spread across 21 provinces in Indonesia during 2011-2016 with total 2,765 observations. Profitability, as dependent variable in this study, is measured by return on assets (ROA) and return on equity (ROE). Management ownership, as independent variable in this study, consists of the existence of board of director ownership and the existence of board of commissioner ownership. In addition, this study also uses bank size, deposit ratio, capital ratio, GDP growth rate, and inflation rate as control variables. The result shows that the existence of board of director ownership has negative and significant effect on ROA and ROE. However, the existence of board of commissioner ownership has no significant effect on all profitability variables. By examining the effect of management ownership on BPRS profitability, it is expected to fill the gap in literature of Islamic financial institutions in Indonesia, especially BPRS.