Internal External Factors In Determining Profitability In The Banking Subsector In 2018-2022

Abstract

This research was conducted with the aim of finding out internal and external factors in determining profitability in the banking subsector in 2018-2022. This type of research is quantitative research with a descriptive approach using financial analysis techniques in the form of CAR, NPL, BOPO, LDR and inflation calculations. The sample in this research consisted of 4 banks that met the specified criteria. The results of this research. In general, the internal factors that play a role in determining profitability in this research are CAR, NPL, BOPO, and LDR. Where the CAR obtained by 3 banks out of the 4 banks studied showed a healthy condition. Then for NPL from 4 banks, it shows that all banks have a percentage of non-performing loans ≤ 2%, meaning that all these banks are very healthy regarding the risk of non-performing loans. For BOPO, all banks have a percentage level of Operating Costs and Operating Income of >97%, which means that all these banks are said to be unhealthy. Meanwhile, for the LDR, it was found that the conditions of these 4 banks generally experienced ups and downs, but predominantly showed fairly healthy and unhealthy conditions. Apart from internal factors, there are external factors that play a role in determining profitability, namely inflation. Where inflation from 4 banks generally experiences conditions that are sometimes healthy but also sometimes unhealthy.