Abstract:
The development of the banking world in Indonesia has undergone significant
transformation, for example, the establishment of Sharia banks. Profitability becomes
a tool for a business to maintain its continuity in the long term. This research will study
about the impact of CAMEL ratios toward profitability of sharia banks in Indonesia.
Ratios that is being applied in this research is Capital Adequacy Ratio, Non Performing
Financing, Net Profit Margin, Net Operating Margin and Financing to Deposit ratio.
Methodology sampling used is purposive sampling. Sample of this research are 11
Sharia Banks in Indonesia from 2015 until 2017. This research uses descriptive
analysis, multi regression analysis, classical assumption test, coefficient of
determination, and hypothesis testing using F-test and T-test. T-test results show that
NPM have positive and significant influence toward ROA of Sharia Bank. And CAR
and NOM variable has positive but not significant towards ROA on Sharia bank
operating in Indonesia. While FDR has negative and significant towards ROA of Sharia
Bank and NPF has negative but not significant towards ROA. F-test shows that CAR,
NPF, NPM, NOM, and FDR simultaneously has influence on profitability. Coefficient
of determination shows the independent variables explains 73,2% variance in
profitability. And NPM is variable that has the most influence toward profitability.
With the result of this research, thus management of Sharia bank should pay attention
to CAR, NPF, NPM, NOM, and FDR because those variable have influence on ROA.
