Research Paper
Year: 2020 | Month: December | Volume: 7 | Issue: 12 | Pages: 236-245
Analysis of Indonesia's Commercial Bank Industry Performance in the Era of Digital Banking 4.0 (Panzar-Rosse Model Approach)
Rahmad Khadafi1, Dede Ruslan2
1,2Faculty of Economics and Business, Universitas Sumatera Utara, Indonesia
Corresponding Author: Rahmad Khadafi
ABSTRACT
Technological advances in the banking industry have disrupted all industries, including the banking industry. This has brought commercial banks in Indonesia towards the digital era 4.0, which has led to a shift in people's behavior in transactions and has led to many digital financial institutions. It is feared that these changes will have an impact on the performance of commercial banks in Indonesia and change the level of competition between commercial bank institutions in the era of digital banking 4.0. This study aims to analyze the performance of the Indonesian commercial bank industry in the era of digital banking 4.0. The approach used to measure the level of influence of independent variables on the performance and level of competition of commercial banks in this study is the panzar-rosse non-structural approach using secondary data from commercial banks in Indonesia in the period January 2013-March 2020. The object of this study is all commercial banks conventional. Estimation of the equation uses return on asset (ROA) as the dependent variable for commercial bank performance, and variable loan to deposit (LDR), volume of e-money transactions, number of electronic data capture (EDC) machines, number of branch offices, number of automated teller machine (ATM) machines, operating expenses operating income (BOPO) and net interest margin (NIM) as independent variables. The results showed that the performance of the Indonesian commercial bank industry in the digital banking era 4.0 as measured by ROA was significant effect by the number of EDC machines, number of branch offices, number of ATM machines, BOPO and NIM. However, LDR and volume of e-money transactions do not have a significant effect on ROA. Furthermore, based on the panzar-rosse model using H-statistics, it shows that the competition that occurred in commercial banks in Indonesia in the era of digital banking 4.0 was included in a monopolistic market structure.
Keywords: Loan to Deposit (LDR), Volume of E-Money Transactions, Number of Electronic Data Capture (EDC) Machines, Number of Branch Offices, Number of Automated Teller Machine (ATM) Machines, Operating Expenses Operating Income (BOPO), Net Interest Margin (NIM), Return on Asset (ROA).
[PDF Full Text]