THE INFLUENCE OF BANK INDONESIA RATE, INFLATION RATE, AND BANK SIZE TOWARDS NONPERFORMING LOAN OF SELECTED COMMERCIAL BANKS IN INDONESIA (A CASE STUDY OF PT. BANK CENTRAL ASIA, PT. BANK MANDIRI, AND PT. BANK RAKYAT INDONESIA IN PERIOD OF 2006 - 2014)

Abstract

The focus of this Skripsi is regarding the influence between macroeconomic and bank specific factors toward Non-Performing Loan of three major banking provider in Indonesia by size of assets. Non-performing loan had slightly increased continuously during the period of first until third quarter of year 2014. Under several interviews conducted by news and organizations, experts in banking industry believe that this event is caused by the economic slowdown. This condition is reflected by selected commercial banks in Indonesia. The datas are processed through descriptive statistics, classical assumption, and multiple regressions to conduct hypothesis. This research used purposive sampling in choosing commercial bank as samples, which are PT. Bank Central Asia, PT. Bank Mandiri, and PT. Bank Rakyat Indonesia. The data collected are secondary in nature yet from trusted sources such as Bank Indonesia, Central Bureau of Statistics (BPS), Financial Service Researcherity (OJK) and quarterly financial report from respective banks. Result shows that two variables have partial significant influences, which are BI Rate with positive influence, which appears to be a dominant factors, and Bank Size with negative influence. Meanwhile inflation rate is resulting in negative yet insignificant influence toward nonperforming loan. In conclusion, BI rate and bank size partially influencing the Nonperforming loan, yet the inflation rate is not.