Banking performances with macroeconomic factors before-during covid-19 and its impacts on stock performance: Empirical evidence from Indonesian category 4 banks
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Institusion
Sekolah Tinggi Manajemen Ipmi
Author
Narasena, Narasena
Subject
HB Economic Theory
Datestamp
2022-01-28 03:30:21
Abstract :
The covid-19 pandemic affected the global banking industries with devastating results. Nonetheless, the pandemic forced banking industries to generate strategies to cushion the pandemic impact in the short term and long term. This study compares banking performances, namely capital adequacy, assets quality, management quality, earnings, and liquidity from 2011 Q1 until 2020 Q4. Also, to analyze the effect of macroeconomic factors, namely GDP growth, inflation, interest rate, and exchange rate on banking performances. And additionally, to explore the impact of the pandemic through both banking performance and macroeconomic factors and market return on the banks' stock performances. The data of this study were collected from seven banks listed in Indonesia financial services authority as category four, representing 60% of Indonesia's banking assets. The analytical process was analyzed using mann-Whitney U-Test and panel data methods. The statistical results revealed that capital adequacy and assets quality increased during the pandemic. Additionally, the macroeconomics factors' effects were varied on bank performances. As for stock performance was affected by capital adequacy, GDP growth, inflation, and market return. The results of this study contribute to the knowledge for researchers and practitioners for specific banking industries during a crisis and what external factors contribute to it.
The covid-19 pandemic affected the global banking industries with devastating results. Nonetheless, the pandemic forced banking industries to generate strategies to cushion the pandemic impact in the short term and long term. This study compares banking performances, namely capital adequacy, assets quality, management quality, earnings, and liquidity from 2011 Q1 until 2020 Q4. Also, to analyze the effect of macroeconomic factors, namely GDP growth, inflation, interest rate, and exchange rate on banking performances. And additionally, to explore the impact of the pandemic through both banking performance and macroeconomic factors and market return on the banks' stock performances. The data of this study were collected from seven banks listed in Indonesia financial services authority as category four, representing 60% of Indonesia's banking assets. The analytical process was analyzed using mann-Whitney U-Test and panel data methods. The statistical results revealed that capital adequacy and assets quality increased during the pandemic. Additionally, the macroeconomics factors' effects were varied on bank performances. As for stock performance was affected by capital adequacy, GDP growth, inflation, and market return. The results of this study contribute to the knowledge for researchers and practitioners for specific banking industries during a crisis and what external factors contribute to it.
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