ANALYSIS THE EFFECTS OF CAR, BOPO, NIM, AND LDR TOWARDS ROA (CASE STUDY: REGIONAL DEVELOPMENT BANKS IN INDONESIA PERIOD 2010 - 2013)

Abstract

The function of bank is very important especially regarding as the financial intermediary. The profitability that proxied by ROA of Regional Development Banks in Indonesia was decline for a certain period. This research aims to analyze the effect of the Capital Adequacy Ratio (CAR), Opeating Expenses/ Operating Income (BOPO), Net Interest Margin (NIM) and Loan to Deposit Ratio (LDR) towards Return on Assets (ROA) of Regional Development Banks in Indonesia period June 2010 until June 2013. This research uses purposive sampling technique. The sample is 26 banks that categorized as Regional Development Banks in Indonesia. The data were obtained from the financial statements issued by Bank Indonesia and the time period is from June 2010 until June 2013. Analysis technique that used in this research is multiple linear regression. The results showed that CAR and NIM have a positive and significant effect towards ROA. In addition BOPO and LDR have a negative and significant effect towards ROA. Of the four significant independent variables, NIM has the greatest effect towards ROA with the coefficient of 0,691. The result is expected that CAR, BOPO, NIM, and LDR can be used as a guide for the bank in managing the company to increase its profitability that proxied by ROA.