From Data to Strategy: Analysis of Profitability, Tangibility, and Liquidity in Building Capital Structure of Islamic Banks in Indonesia

Wiwik Andriani, Dedy Djefris, Zahara Zahara

Abstract


This study investigates the impact of profitability, tangibility, and liquidity on the capital structure of Islamic banks in Indonesia from 2021 to 2023. Employing a quantitative approach, the research utilizes multiple linear regression analysis. The population consists of 13 Islamic commercial banks registered with the Financial Services Authority (OJK) during this period, with a purposive sampling method resulting in a sample of 12 banks. Data are gathered from secondary sources, specifically annual financial reports available on each bank's website. The findings reveal that while profitability and tangibility do not significantly influence capital structure, liquidity has a negative and significant impact on it. Improving liquidity management, adjusting financing policies, and focusing on operational efficiency to enhance profitability are essential. Additionally, communicating liquidity strategies to investors and training staff on liquidity risk management will support better decision-making within the bank. This research lies in its focus on Islamic banks in Indonesia, highlighting liquidity's negative impact on capital structure. It provides contemporary empirical data, practical recommendations for management, and contributes to the literature on financial practices in Islamic banking.

Keywords


Profitability, Tangibility, Liquidity.

Full Text:

PDF

References


Al Balushi, Y., Locke, S., & Boulanouar, Z. (2019). Determinants of the decision to adopt Islamic finance: evidence from Oman. ISRA International Journal of Islamic Finance, 11(1), 6-26.

Al-Sulaiti, J., Ousama, A.A., & Hamammi, H. (2018). The compliance of disclosure with AAOIFI financial accounting standards: A comparison between Bahrain and Qatar Islamic banks. Journal of Islamic Accounting and Business Research, 9(4), 549-566.

Wiwik Andriani, Dedy Djefris, & Zahara, From Data to Strategy: Analysis of Profitability, Tangibility, and

Liquidity in Building Capital Structure of Islamic Banks in Indonesia

Darapalgia, N.K.M., Eliyanora, E., & Ahmad, A.W. (2024). Analisis pengaruh bancassurance dan tingkat kecukupan modal terhadap profitabilitas Bank Pembangunan Daerah Tahun 2018-2022. Ekonomis: Journal of Economics and Business, 8(1), 370-377.

Fitri, W.N., Andriani, W., & Ananto, R.P. (2023). Financial performance of infrastructure companies before and during the Covid-19. Jurnal Manajemen Universitas Bung Hatta, 18(1), 114-123.

Kahya, E.H., Ersen, H.Y., Ekinci, C., Taş, O., & Simsek, K.D. (2020). Determinants of capital structure for firms in an Islamic equity index: comparing developed and developing countries. Journal of Capital Markets Studies, 4(2), 167-191.

Lisa, O. (2016). Determinants distribution of financing and the implications to profitability: Empirical study on cooperative Sharia Baitul Maal wa Tamwil (BMT) in Indonesia. Asian Journal of Accounting Research, 1(2), 44-51.

Nasrah, H., & Resni, N. (2020). Faktor-faktor yang mempengaruhi struktur modal Bank Syariah di Indonesia Tahun 2014-2018. Jurnal Tabarru’: Islamic Banking and Finance, 3(2), 281-294.

Nomran, N.M., & Haron, R. (2020). A systematic literature review on Sharī’ah governance mechanism and firm performance in Islamic Banking. Islamic Economic Studies, 27(2), 91-123.

Ousama, A.A., Hammami, H., & Abdulkarim, M. (2020). The association between intellectual capital and financial performance in the Islamic banking industry: An analysis of the GCC banks. International Journal of Islamic and Middle Eastern Finance and Management, 13(1), 75-93.

Pratama, A.E., & Fitriani, I.R. (2023). Pengaruh profitabilitas, likuiditas dan struktur aset terhadap struktur modal dengan ukuran perusahaan sebagai variabel moderasi. Management Studies and Entrepreneurship Journal, 4(2), 2040-2052.

Rahmalia, N.R., Ruhadi, R., & Mayasari, I. (2022). Pengaruh inflasi terhadap pertumbuhan aset dengan struktur modal sebagai variabel intervening: Studi Bank Umum Syariah di Indonesia. Journal of Applied Islamic Economics and Finance, 2(2), 370-378.

Rofi’atun, R., & Nabila, R. (2021). Faktor-faktor yang mempengaruhi struktur modal pada bank umum syariah. Journal of Accounting and Digital Finance, 1(2), 59-71.

Shawtari, F.A.M. (2018). Ownership type, bank models, and bank performance: the case of the Yemeni banking sector. International Journal of Productivity and Performance Management, 67(8), 1271-1289.




DOI: http://dx.doi.org/10.33087/sjee.v9i1.212

Refbacks

  • There are currently no refbacks.


Creative Commons License
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

SJEE (Scientific Journals of Economic Education)
Publisher: Program Studi Pendidikan Ekonomi, FKIP Universitas Batanghari
Jl. Slamet Ryadi, Broni-Jambi, Kodepos: 36122, email: sjee.unbari@gmail.com