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ANALYSIS OF INTERNAL AND EXTERNAL FACTORS FOR DETERMINING THE EFFICIENCY OF SHARIA BANKING IN INDONESIA (With the Two-Stage Data Envelopment Analysis Approach)
Rafika Rahmawati

Universitas Islam "45" Bekasi


Abstract

The importance of the banking role in the stability of the country and the increasing competitiveness of the financial sector, especially banking, both domestic and international scale requires the national banks to have a good performance and competitive. In this study will analyze the internal and external factors that determine the level of efficiency of sharia banking in Indonesia. The method used in this research is Two-Stage Data Envelopment Analysis. In the first stage, this research measures efficiency by using Data Envelopment Analysis (DEA) approach and the second stage is regression analysis of Tobit Model. The efficiency scores that have been obtained are used as the dependent variable in the regression model in determining the efficiency determination on the Sharia Commercial Banks in Indonesia. The result of the research shows that the efficiency level of Sharia Public Bank during the research period is 69.28% and it is categorized as less efficient. Based on the tobit model results, internal factors that determine the efficiency level include asset, FDR, and ROA. All of them have a negative effect on the efficiency level of Sharia Commercial Banks. Meanwhile, the external factors determining the efficiency level of Sharia Commercial Banks are GDP, inflation, and market share. All of them have a positive effect on the efficiency level of Sharia Commercial Banks.

Keywords: Efficiency, Islamic Banking, Two-Stage DEA

Topic: Islamic Finance and Banking

Link: https://ifory.id/abstract/NDCP6zQrx34t

Conference: THE 4th ANNUAL ISLAMIC FINANCE CONFERENCE (AIFC 2019)

Plain Format | Corresponding Author (Rafika Rahmawati)

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