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The determinant factors of asset and liability management and the bank performance: empirical study on foreign exchange commercial banks in Indonesia from 2008 to 2013

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  • Herlanto Anggono

Abstract

This study examines the determinants factors of asset and liability management (ALM) model and investigates the impact to bank performance, using bank-specific internal financial characteristic of Indonesian banking in the years 2008-2013. Three determinant factors in ALM model have the highest elasticity which are less risky liquid assets ratio (LRLATA), non-performing loan ratio (NPLR) and tier one core capital (TIR1TA) ratio. LRLATA ratio influences to liquidity coverage ratio (LCR) and loan to deposit ratio (LDR) significantly. NPLR ratio also has significant influence to LDR and TIR1TA ratio influences significantly to capital adequacy ratio (CAR). In the second model, net interest margin ratio (NIMTEA) is positive significant to bank performance - return on equity (ROE) because NIMTEA has the highest elasticity.

Suggested Citation

  • Herlanto Anggono, 2017. "The determinant factors of asset and liability management and the bank performance: empirical study on foreign exchange commercial banks in Indonesia from 2008 to 2013," International Journal of Business and Globalisation, Inderscience Enterprises Ltd, vol. 19(4), pages 512-527.
    • Handle: RePEc:ids:ijbglo:v:19:y:2017:i:4:p:512-527
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    Cited by:

    1. Mulualem Getahun Abebe, 2022. "The effect of asset and liability management on the financial performance of microfinance institutions: evidence from sub-Saharan African region," Future Business Journal, Springer, vol. 8(1), pages 1-12, December.

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