Can the Efficiency of Islamic Banks in Indonesia Improve Their Competitiveness (original) (raw)
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Efficiency of Islamic Banks in Indonesia: Data Envelopment Analysis
International Journal of Economics, Management and Accounting, 2017
This paper measures the efficiency of Islamic commercial banks in Indonesia by analyzing factors that affect the level of efficiency using the two-stage data envelopment analysis (DEA) method. The objects of this study are 10 Islamic commercial banks in Indonesia which are analyzed from 2011 to 2014. Two methods are used in this study, namely nonparametric method of DEA in the first stage and Tobit model in the second stage. The actual average efficiency of Islamic commercial banks in Indonesia is at fairly good level with an average score 91.82, which means that although relatively inefficient, Islamic commercial banks in Indonesia are able to optimize their resource inputs to produce outputs as an intermediary institution. The application of the Tobit model uses asset (ASSET), non-performing financing (NPF), capital adequacy ratio (CAR), number of bank branches (BRANCH) and return on asset (ROA) as the explanatory variables. The results showed that the variables of assets, number ...
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Banking sector mediation is related to efficiency in economic performance. As a financial institution, banks need to maintain their performance in order to operate optimally, one factor that must be considered is efficiency in performance. This research aimed to analyze the efficiency of Islamic Banks and Conventional Commercial Bank in Indonesia. Using a purposive sample technique for two Islamic banks and two commercial banks. Fixed assets, deposits, and other operating expenses as input variablesused, while credit as output variable. Using Data Envelopment Analysis to calculate the efficiency of banking. The results show that all Sharia Commercial Bank samples reached efficiency level 1 was efficient. Besides, the sample of conventional commercial banks used in this study is not all efficient. This is due to one of the sample banks having an efficiency level below one, which is 0.644. It means that conventional bank groups are inefficient.
Efficiency of Islamic Banks Using Data Envelopment Analysis (DEA) in Indonesia, 2007-2010
International Journal of Academic Research in Economics and Management Sciences, 2014
The purpose of this study is to analyze the efficiency level of Islamic Banks (Bank Muamalat Indonesia, Bank SyariahMandiri, Bank Mega Syariah) in Indonesia through the input-output variables that correspond to the economic theory of the years 2007-2010, using the method of Data Envelopment Analysis (DEA). There are five important variables in this research that the input variables of bank is operating costs (I 1), labor costs (I 2) and banking services (I 3), while the output variables is total deposits(O 1) and deposits (O 2).
The efficiencies related to business activities and needed for competitive advantage. An efficiency bank is important for its capability in mobilizing public funds or channelling funds to people who need business capital. The study tests the effect of the relationship between efficiency on the performance of Sharia banking in Indonesia. The research type is descriptive. The research object is the financial statements of 11 Sharia banks in Indonesia. The data analysis method used is Data Envelopment Analysis (DEA), ratio analysis, and panel data. The results showed that based on the DEA analysis, the overall average of Sharia banks reached an efficiency of 95.1% and the bank's efficiency impacts to NIM but contras finding on ROA. It implicates that sharia banking should be able to manage time, funds, costs as best as possible as well as avoiding risks and interests for optimizing profit.
ISLAMICONOMIC: Jurnal Ekonomi Islam
This study aims to measure the level of performance efficiency of Islamic banks in Indonesia and Saudi Arabia from 2018 to 2020; and Analyzing improvement targets that can be carried out by Islamic banks in Indonesia and Saudi Arabia to achieve optimum performance using the Data Envelopment Analysis (DEA) method. Data analysis was carried out using the MaxDEA program version 8.2. The sampling technique in this study was done by purposive sampling. The object of this research is the 4 largest Islamic banks in each country. Input and Output Variable data are obtained from financial reports from 2018 - 2020. The results show that the average efficiency value of Indonesian Islamic Banks is higher than the average efficiency of Saudi Arabian Islamic Banks in the 2018 and 2019 periods. using both the CRS and VRS models. As for the 2020 period, the opposite applies where the average efficiency value of Saudi Arabian Islamic Banks outperforms Indonesian Islamic Banks with the same two measu...
Determinant of Efficiency in the Indonesian Islamic Banks
Signifikan: Jurnal Ilmu Ekonomi
This study aims to analyze the factors that influence the level of efficiency of Islamic commercial banks in Indonesia. The research employs a panel data analysis and a non-parametric Data Envelopment Analysis (DEA) to measure the level of efficiency. The panel data analysis showed that company size, profitability, liquidity, and management significantly affect the level of efficiency of Islamic banks in Indonesia, while capital and financing risk have no significant impact. The efficiency of Islamic banks in Indonesia should be maintained by balancing the distribution of assets, ensuring portfolio diversification, maintaining sufficient liquidity, and paying attention to management quality. The originality of this study, to the best of the author's knowledge, is that it is the first study to examine the determinants of efficiency in Indonesian Islamic commercial banks using quarterly data from the period of 2015-2020. As a result, the data analyzed has a sufficient amount.JEL C...
The determinant factors of efficiency on Islamic banking and conventional banking in Indonesia
Jurnal Keuangan dan Perbankan, 2019
As intermediary institutions, conventional banks have larger amount of loans to third party funds than of Sharia banks. Thus, the bank needs a performance appraisal to measure banking operations through efficiency. We examine the efficiency of Islamic banks and conventional banks in Indonesia and analyzes the factors that influence the level of efficiency known as the Two-Stage Data Envelopment Analysis method. We found that there are significant efficiency differences between Islamic banking and conventional banking in the 1 st quarter 2014-4 th quarter 2017. On the other hand, NPF and NPL results affected negatively towards Islamic and conventional banks efficiency. Asset and CAR affected positively significant toward Islamic banks efficiency. Asset and ROA had affected positively significantly toward conventional banks efficiency but CAR had affected positively insignificantly toward conventional banks. Lastly, ROA had affected positively insignificantly toward Islamic banks efficiency Abstrak Bank sebagai lembaga keuangan memiliki peran penting bagi pertumbuhan ekonomi Indonesia. Peran penting tersebut terlihat dari fungsi bank sebagai lembaga perantara, yaitu sebagai penghubung antara pihak kelebihan dan kekurangan dana. Agar fungsi perantara optimal, bank harus memberikan kinerja terbaik untuk meningkatkan kesejahteraan masyarakat. Pengukuran efisiensi adalah salah satu indikator kinerja perbankan yang membutuhkan perhatian, dimana hasil pengukuran ini digunakan sebagai bahan evaluasi untuk terus meningkatkan kinerja perbankan. Tujuan kajian ini mengukur efisiensi Bank Syariah dan Bank konvensional di Indonesia serta menganalisa faktor yang memengaruhi tingkat efisiensi yang dikenal dengan metode Two-Stage Data Envelopment Analysis. Hasil kajian menunjukkan bahwa ada perbedaan efisiensi yang signifikan antara perbankan Syariah dan perbankan konvensional pada Triwulan 1 2014-Triwulan 4 2017. Variabel Aset berpengaruh positif signifikan pada kedua efisiensi bank, sedangkan NPF/NPL berpengaruh negatif tidak signifikan terhadap dua efisiensi bank. Variabel ROA berpengaruh positif signifikan pada efisiensi bank konvensional dan berpengaruh positif tidak signifikan pada efisiensi bank syariah. Untuk variabel CAR berpengaruh positif signifikan pada efisiensi bank syariah dan berpengaruh positif tidak signifikan pada bank konvensional.
Measuring the Competitiveness of Islamic Banking in Indonesian Dual Banking System
2008
Islamic banks in many countries have emerged as important component of financial system that contributes to the growth and development of the country’s economy. They have proven to be a viable and competitive component of the overall financial system. In the dual banking system, Islamic banks have to be competitive to survive. One of the key to competitiveness is efficiency. This study will measure and compare the efficiency of Islamic and conventional banks in Indonesia using Data Envelopment Analysis (DEA) methodology. DEA is a non-parametric, deterministic methodology for determining the relative efficiency and managerial performance, based on the empirical data on chosen inputs and outputs of a number of decision making units. DEA allows us to compare the relative efficiency of banks by determining the efficient banks as benchmarks and by measuring the inefficiencies in input combinations (slack variables) in other banks relative to the benchmark. Intermediation approach will be...
COMPARING THE EFFICIENCY OF ISLAMIC BANKS IN MALAYSIA AND INDONESIA
A b s t r a c t This study measures and compares the efficiency of Islamic banks in Malaysia and Indonesia using Data Envelopment Analysis (DEA), which is a non-parametric and deterministic methodology for determining the relative efficiency. The intermediation approach will be applied. This study identifies the sources and the level of inefficiency of the inputs and outputs. The results show that the Islamic banking in Indonesia is more efficient than the one in Malaysia in all three measurements; the technical, the scale, and the overall efficiency. Technically, financing is one of the sources of inefficiency in Malaysia, while human resource is one of the sources of inefficiency in Indonesia. Islamic windows should be encouraged to convert to subsidiaries or Islamic full branches to improve the scale and the overall efficiencies in Malaysia. Furthermore, the accelerated expansion both organically and inorganically is needed to improve the scale and the overall efficiencies of the Islamic banking in Indonesia.
Measuring efficiency of Islamic Banks: evidence from Indonesia
JURNAL EKONOMI DAN KEUANGAN ISLAM, 2018
The present study investigates the efficiency of Islamic banks in Indonesia particularly for the period of 2014-2015. To meet that objective, the data envelopment analysis (DEA) particularly input-oriented, variable return to scale (VRS) has been employed. Additionally, twelve full-fledge Islamic commercial banks are included as the sample of the study. Having analysed using the DEA model, we find the average technical efficiency score of Islamic banks in 2014 is 0.843. In this regard, the inefficiency of Islamic banks is attributed equally to pure technical efficiency and scale efficiency. Moreover, the average technical efficiency score of Islamic banks for the year of 2015 is 0.832 which is lower than the previous year. The inefficiency of Islamic banks in 2015 is mainly contributed by the scale inefficiency. Moreover, the results reveal a declining productivity of Islamic banks during the period of study. Abstrak Penelitian ini menguji efisiensi Bank Syariah di Indonesia selama periode tahun 2014-2015. Untuk mencapai tujuan tersebut digunakan data envelopment analysis (DEA) kususnya input-oriented, dengan menggunakan variable return to scale (VRS). Sample yang digunakan adalah 12 bank syariah. Dengan menggunakan model analisis DEA, penulis menemukan nilai efisiensi teknis rata-rata di tahun 2014 sebesar 0.843. dalam hal ini, ketidakefisienan bank syariah dikaitkan dengan efisiensi teknis murni dan efisiensi skala. Apalagi skor efisiensi teknis rata-rata bank syariah untuk tahun 2015 adalah 0,832 yang lebih rendah dari tahun sebelumnya. Inefisiensi bank syariah pada tahun 2015 terutama disumbang oleh skala inefisiensi. Selain itu, hasilnya menunjukkan penurunan produktivitas bank syariah selama periode penelitian.