Financial distress for bankruptcy early warning by the risk analysis on go-public banks in Indonesia
DOI:
https://doi.org/10.14414/jebav.v19i2.542Keywords:
Bankruptcy, Early Warning, Financial Distress, and Risk Analysis.Abstract
Early warning is essential for overseeing the firm’s financial system stability, and is developed by financial distress model. Financial Distress is financial declining phase that happens before bankruptcy or liquidation. This Research aimed to analyze whether the following factors such as CKPN (Allowance For Impairment Losses Of Credits), NPL (Non Performing Loan), IRR (Interest rate Ratio), PDN (Net Open Position), LDR (Loan To Deposit Ratio), IPR (Investing Policy Ratio), OE-OI (Operating Expenses To Operating Revenues) and FBIR (Fee Based Income Ratio) can determine financial distress as early warning in Indonesia’s go public banks. It is a quantitative study, with the sample of 100 go-public banks listed in Indonesia Stock Ex-change (www.idx.go.id) ranging from 2010 to 2014, collected using purposive sampling. They were analyzed using SPSS 23 IBM version. The result shows that LDR (Loan To Deposit Ratio) is the most significant factor to determine financial distress as early warning of bankruptcy of Indonesia’s go public banks. Besides that, it has several implications for regulators and bank management to determine the firm financial system stabilization.References
Adi, BA 2014, Analisis Rasio-rasio Keuangan untuk Memprediksi Financial Distress Bank Devisa Periode 2006-2011, Journal of Business and Banking, Vol. 4 (1), 105-116.
Ghozali, Imam 2016, Aplikasi Analisis Multivariate dengan Program IBM SPSS 23, 8th Edition, Semarang: Badan Penerbit Universitas Diponegoro.
Gonzalez MI-Bravo and Arloja Mecaj 2011, Structural and Evolutionary Patters in a Financial Distress Situation, Advances in Decision Sciences, Hindawi Publishing Corporation.
Harahap, AM 2015, Prediction of Financial Distress in Foreign Exchange Banking Firms Using Risk Analysis, Good Corporate Governance, Earnings and Capital, The Indonesian Accounting Review, Vol. 5 (1), 33-44.
Hasibuan, Malayu 2004, Dasar-Dasar Perbankan, Third Edition, Jakarta: Penerbit PT. Bumi Aksara.
Indriantoro, Nur and Bambang Supomo 1999, Metodologi Penelitian Bisnis Untuk Akuntansi dan Manajemen, First Edition, Yogyakarta: BPFE.
M Fakhri Husein and Galuh Tri Pambekti 2014, Precision of The Models of Altman, Springate, Zmijewski, and Grover for Predicting the Financial Distress, Journal of Economics, Business and Accountancy Ventura, Vol. 17 (3).
PAPI 2008, Pedoman Akuntansi Perbankan Indonesia (Revisi 2008). Surat Edaran No. 3/30 DPNP dated 14 December 2001 about Pedoman Perhitungan Rasio Keuangan.
Widarjo, W and Doddy Setiawan 2009, Pengaruh Rasio Keuangan Terhadap Kondisi Financial
Distress Perusahaan Otomotif, Jurnal Bisnis dan Akuntansi, Vol. 11 (2), 107-119. www.idx.go.id.
Downloads
Additional Files
Published
How to Cite
Issue
Section
License
Copyright (c) 2017 Laely Aghe Africa

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