Determinants of Bank Financial Performance in Indonesia: The Role of Governance, Capital Structure, Firm Size, and Intellectual Capital
Keywords:
Corporate Governance, Capital Structure, Financial Performance, Firm Size, Intellectual Capital.Abstract
This study analyzes the determinants affecting the financial performance of commercial banks in Indonesia, employing secondary data from banks listed on the IDX from 2019 to 2023. The analysis examines corporate governance, capital structure, firm size, and intellectual capital as independent variables, uses ROA and ROE as indicators of bank performance. We apply panel data regression using STATA 17. The findings show that corporate governance and capital structure do not exert a measurable impact on either ROA or ROE. Firm size improves ROE but does not materially affect ROA. By contrast, intellectual capital consistently and strongly enhances both ROA and ROE, highlighting its central role in bank profitability in Indonesia. This research offers critical insights for bank management to improve performance and for regulators to formulate effective regulations that promote the stability and sustainability of the banking sector in Indonesia.
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