THE EFFECT OF CAR, BOPO, AND NPL ON FINANCIAL PERFORMANCE (ROA) WITH LDR AS INTERVENING VARIABLES IN BANKING COMPANIES IN INDONESIA 2015-2019 PERIOD

Abstract

ROAiis therright ratiooused to measuretthe effectivenessoof banks inggenerating profitsbby utilizinggassets owned. The problem in thissstudy is how to increase LDR sotthat it canhhave a positiveiimpact on improving banking financial performance. Theppurpose oftthis studywwas to determinetthe effectoof CAR, BOPO and NPL partiallyyand simultaneouslyoon LDR and financial performanceaand to determine whether LDR mediates theeeffect ofcCAR, BOPOrand NPL on financial performance. The populationnin thisystudy were commercial banks listedoon the Indonesia Stock Exchangei(IDX) in the period 2015 - 2019. The samplinggtechnique used wasppurposive sampling so that a sample of 23 banks was obtained for a period of 5 years so that the observation data became 115 data. The data analysisttechnique usedi was TwosStage LeastsSquare (2SLS). Basedoon the calculationrresults, it can be seen that partially only BOPO has an effectoon LDR, whilecCAR and NPL havenno effectton LDR, and simultaneously CAR,bBOPO and NPL have an effect on LDR. Partially BOPO and NPL have an effectuon financialpperformance, whilecCAR anddLDR have no effecttuon financiallperformance, and simultaneously iCAR, iBOPO, NPLland LDRchave an effecttion financial performance. BOPO is an important variable that canybe usedaas a considerationhin determining an investmenttstrategy, because the results show that BOPO hasaan influenceeon LDR andifinancial performance, where BOPO has a very large influence on financial performance. BOPO must also be of particular concern sotthat theccompany issalways attthe level of efficiency that can generate maximum profit, so that optimal financial performance is achieved. Keywords: Commercial Banks, CAR, BOPO, NPL, LDR and Financial Performance