A COMPARATIVE STUDY OF BANKING PERFORMANCE AND STABILITY: BEFORE AND AFTER ISLAMIC BANKING BUSINESS UNIT SPIN-OFF IN INDONESIA

• Main Author: Dhianir Rahman Panca, Aqilla
• Format: Final Project
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/49526
• Institution: Institut Teknologi Bandung

The Degree number 11 on 2008 has forced the Islamic Bank Business Unit (IBBU) to spin-off from its conventional parents company. The benefit of spin-off from IBBU to Islamic Commercial Bank (ICB) is not quite clear yet. The purpose of this study is to understand the impact of spin-off toward financial performance and stability of ICB in Indonesia. The financial performance assessment that used in this study is a combination of profitability and liquidity. This research use 4 spinoff ICB as treatment group and 20 IBBU as the control group, from 2005 to 2019. The method used is this study is difference-in-difference (DID) that compare before and after spin-off with eliminating the other factor that could make the result biased. The result shows that ROA, ROE, and FDR are significantly decreasing and BOPO is significantly increasing. The stability is insignificant but it shows development through years after spin-off. The conclusion is that the ICB samples profitability and liquidity is changing due to the spin-off and the spin-off did not affecting the stability of the ICB samples.