The Effect Of Capital Structure And Liquidity On Profitability Of Bank Rakyat Indonesia Syariah (BRIS)

Abstract

A bank's performance can be best gauged by looking at its profitability. You may learn a lot about a company's capacity to turn its money into profit by doing a profitability analysis. The purpose of this research is to analyze Bank Rakyat Indonesia syariah (BRIS) profitability from 2018 to 2022 via the lens of capital structure and liquidity. This study employs a quantitative methodology and draws on documentary data collected quarterly from annual reports released by BRIS between 2018 and 2022. A negative path coefficient of -0.69 with a tiny p-value of 0.01 from 0.05 is produced by the capital adequacy ratio (CAR) with Return On Equity (ROE), according to this study's conclusions. In other words, it has a negative effect on CAR's ability to increase ROE, contributing 0.74, or 74%. Results demonstrate that CAR significantly and negatively affects Return On Equity ROE, impacting it by -69%. A negative path coefficient of -0.47 with a tiny p-value of 0.1 of 0.05 is produced by combining the financing to deposit ratio (FDR) with Return On Equity (ROE). This indicates that the Financing to Deposit Ratio has a negative association with increasing Return On Equity ROE, contributing 0.74 or 74%. The results demonstrate that the Return on Equity (ROE) is negatively affected by the Financing to Deposit Ratio (FDR) (47%).