The study is intended to analyse fluctuations in profitability (NIM) caused by the internal strengths owned by Regional Development Bank (RDBs) in Sulawesi Island. The Internal strengths are the liquidity capital (CAR), efficiency (BOPO), and credit channel (LDR), while profitability is reflected by Net Interest Margin (NIM). Four regional banks operating within the Sulawesi Island was studied using times series data. Datawas collected from audited annual report in between 2007 – 2018. The obtained data was analyzed with use of Multiple Regression Analysis, and testing with classical assumption for multicolinearity, heteroscedasticity, autocorrelation, as well as P-P plotnormality test beforehand. Interestingly, the findings indicates that loan channels and liquidity capital affect negatively and significantly the profitability. This is also the same for the association between efficiency and profitability.
Volume 12 | Issue 3
Pages: 720-726
DOI: 10.5373/JARDCS/V12I3/20201939