Sharia Rural Banks in East Java: How Its Hazard Rate? (The Analysis Using Multiple Period Logit)

Abstract

This study aimed to determine the susceptibility opportunities of each BPRS. The second objective is to find out the financial ratios that cause it. The financial sustainability measure is a measuring tool to calculate the chance of survival. Financial sustainability approximates the value of Financial Self-Sufficiency (FSS). The population used is BPRS in East Java. The analysis technique used survival analysis and multiple period logit models. The study results show that only 8 BPRS have a chance to sustain more than 30%. Research variables that invariably affect the sustainability of BPRS include NPF, ROA, Bank Size, PM, FR, GLP, WoR, and LDR. Financial sustainability is an excellent Early Warning System to determine financial institutions' financial health, so this research is a good contribution to them.