The Influence of Risk Management and Firm Size Towards Profitability of Islamic Banks in Indonesia

Shafira Yustianita
Management Study Program, Faculty of Business, President University

Faculty of Economic and Business, Padjajaran University


This research aims to identify the influence of risk management and firm size towards profitability. The determinant variables are capital adequacy ratio, non-performing financing, operational efficiency ratio, financing to deposit ratio, reserve requirement, and firm size. This study adopted quantitative research and data from Financial Report of Bank Indonesia in its official website. This study is fixed model effect which is using panel regression technique where those data has tested by normality, autocorrelation, multicollinearity, and heteroscedasticity test. An empirical evidence of this research indicates that CAR, OER, and firm size have partially significant influence towards ROA. FDR and RR have a positive insignificant effect to ROA, while NPF has a negative insignificant impact to ROA. Simultaneously, CAR, NPF, OER, FDR, RR, and firm size have the significant effect to ROA which the value of 91.7% and the remain 8.3% are explained by another factor excluded in this research.

Keywords: ROA, CAR, NPF, OER, FDR, RR, Size, Performance, Risk