Analysis Of Factors Affecting Credit Distribution To Regional Development Banks In Indonesia

Feb 27, 2025 by ADMIN 93 views

Analysis of Factors Affecting Credit Distribution to Regional Development Banks in Indonesia

Introduction

Credit distribution by the Regional Development Bank (BPD) in Indonesia is a crucial indicator in supporting the regional economy. The performance of credit distribution is influenced by various factors, including third party funds (DPK), capital adequacy ratio (CAR), non-performing loans (NPL), and return on asset (ROA). This study aims to analyze the factors affecting credit distribution in BPD using secondary data from financial statements published in the 2018 to 2021 period. By applying multiple linear regression analysis methods to panel data, this study aims to provide insights into the factors that influence credit distribution in BPD.

Methodology

This study uses a purposive sampling method to select 26 BPDs as the final sample. The target population includes all regional development banks in Indonesia that published their financial statements. The data collected includes financial statements, which are analyzed using multiple linear regression analysis methods to panel data. The results of the analysis are presented in the following sections.

Analysis of Research Results

Impact of Third Party Funds (DPK)

Third party funds have a positive and significant influence on credit distribution by BPD. This means that the greater the DPK that is collected, the higher the ability of BPD in providing credit to customers. DPK acts as the main source of funding for banks, and the existence of these funds is very crucial to maintain liquidity and expand the reach of credit services. The results of this study indicate that BPD needs to maximize the management of third party funds to increase the capacity of credit distribution.

The Importance of DPK in Credit Distribution

The results of this study highlight the importance of DPK in credit distribution. DPK is the main source of funding for banks, and its existence is crucial to maintain liquidity and expand the reach of credit services. The greater the DPK that is collected, the higher the ability of BPD in providing credit to customers. This is because DPK provides a stable source of funding, which enables BPD to expand its credit services and increase its capacity to provide credit to customers.

Effect of Capital Adequacy Ratio (CAR)

Interestingly, the results showed that the capital adequacy ratio had a negative and significant influence on credit distribution. This can be interpreted that when BPD has a higher capital adequacy, they tend to be more careful in providing loans, thereby reducing the volume of credit distribution. This can also be caused by tighter regulations related to capital adequacy, which encourages banks to reduce risk by not increasing credit portfolios.

The Impact of CAR on Credit Distribution

The results of this study indicate that CAR has a negative and significant influence on credit distribution. This means that when BPD has a higher capital adequacy, they tend to be more careful in providing loans, thereby reducing the volume of credit distribution. This can be caused by tighter regulations related to capital adequacy, which encourages banks to reduce risk by not increasing credit portfolios.

Non-Performing Loans (NPL) and Return On Asset (ROA)

Research also found that non-performing loans and returns on assets have an insignificant negative influence on credit distribution. NPL, which reflects credit quality, does not show a strong influence on credit decisions, perhaps because BPD is more focused on managing risk by considering the macroeconomic conditions and debtors' profiles. Likewise with ROA, although this is a profitability indicator, there is no significant direct impact on credit distribution.

The Impact of NPL and ROA on Credit Distribution

The results of this study indicate that NPL and ROA have an insignificant negative influence on credit distribution. This means that NPL and ROA do not show a strong influence on credit decisions, perhaps because BPD is more focused on managing risk by considering the macroeconomic conditions and debtors' profiles. Likewise with ROA, although this is a profitability indicator, there is no significant direct impact on credit distribution.

Conclusion

From the results of this study, it can be concluded that BPD needs to maximize the management of third party funds to increase the capacity of credit distribution. Meanwhile, attention must also be given to the ratio of capital adequacy to maintain a balance between credit growth and risk management. This shows that a deep understanding of the factors that influence credit distribution is very important for BPD in developing a more effective business strategy in the future. By increasing this understanding, BPD can contribute greater to regional economic growth in Indonesia.

The Importance of Understanding Credit Distribution Factors

The results of this study highlight the importance of understanding the factors that influence credit distribution. BPD needs to maximize the management of third party funds to increase the capacity of credit distribution. Meanwhile, attention must also be given to the ratio of capital adequacy to maintain a balance between credit growth and risk management. This shows that a deep understanding of the factors that influence credit distribution is very important for BPD in developing a more effective business strategy in the future.

Conclusion and Recommendations

In conclusion, this study provides insights into the factors that influence credit distribution in BPD. The results of this study indicate that BPD needs to maximize the management of third party funds to increase the capacity of credit distribution. Meanwhile, attention must also be given to the ratio of capital adequacy to maintain a balance between credit growth and risk management. This study recommends that BPD should develop a more effective business strategy that takes into account the factors that influence credit distribution. By increasing this understanding, BPD can contribute greater to regional economic growth in Indonesia.

Recommendations for BPD

Based on the results of this study, the following recommendations are made for BPD:

Maximize the management of third party funds to increase the capacity of credit distribution.
Pay attention to the ratio of capital adequacy to maintain a balance between credit growth and risk management.
Develop a more effective business strategy that takes into account the factors that influence credit distribution.
Increase the understanding of the factors that influence credit distribution to contribute greater to regional economic growth in Indonesia.

Conclusion

Q: What is the main objective of this study?

A: The main objective of this study is to analyze the factors that influence credit distribution in Regional Development Banks (BPD) in Indonesia. The study aims to provide insights into the factors that affect credit distribution and to identify the key factors that influence credit distribution in BPD.

Q: What are the key factors that influence credit distribution in BPD?

A: The key factors that influence credit distribution in BPD are third party funds (DPK), capital adequacy ratio (CAR), non-performing loans (NPL), and return on asset (ROA). The study found that DPK has a positive and significant influence on credit distribution, while CAR has a negative and significant influence on credit distribution.

Q: What is the significance of DPK in credit distribution?

A: DPK is the main source of funding for banks, and its existence is crucial to maintain liquidity and expand the reach of credit services. The greater the DPK that is collected, the higher the ability of BPD in providing credit to customers.

Q: What is the impact of CAR on credit distribution?

A: The study found that CAR has a negative and significant influence on credit distribution. This means that when BPD has a higher capital adequacy, they tend to be more careful in providing loans, thereby reducing the volume of credit distribution.

Q: What is the role of NPL and ROA in credit distribution?

A: The study found that NPL and ROA have an insignificant negative influence on credit distribution. This means that NPL and ROA do not show a strong influence on credit decisions, perhaps because BPD is more focused on managing risk by considering the macroeconomic conditions and debtors' profiles.

Q: What are the implications of this study for BPD?

A: The study recommends that BPD should maximize the management of third party funds to increase the capacity of credit distribution. Meanwhile, attention must also be given to the ratio of capital adequacy to maintain a balance between credit growth and risk management.

Q: What are the implications of this study for regulators and policymakers?

A: The study provides insights into the factors that influence credit distribution in BPD, which can be useful for regulators and policymakers in developing policies and regulations that support the growth of regional economies.

Q: What are the limitations of this study?

A: The study has several limitations, including the use of secondary data and the limited sample size. Future studies can build on this study by using primary data and a larger sample size.

Q: What are the future research directions?

A: Future research can build on this study by exploring the impact of other factors on credit distribution, such as interest rates, inflation, and economic growth. Additionally, future research can examine the impact of credit distribution on regional economic growth and development.

Q: What are the practical implications of this study?

A: The study provides practical implications for BPD, regulators, and policymakers. BPD can use the findings of this study to develop a more effective business strategy that takes into account the factors that influence credit distribution. Regulators and policymakers can use the findings of this study to develop policies and regulations that support the growth of regional economies.

Q: What are the contributions of this study?

A: The study contributes to the existing literature on credit distribution and regional economic growth. The study provides insights into the factors that influence credit distribution in BPD and identifies the key factors that influence credit distribution. The study also provides practical implications for BPD, regulators, and policymakers.