Synergy of Regulators and Liquidity Management in Controlling Bank Risk to Improve Bank Performance

Wisnu Mawardi, Sugeng Wahyudi, Julia Safitri


This study uses banking companies as the object of research, considering the bank's very important role. The research object in this is banking companies listed on the IDX during 2014-2019. The type of data in this documentary is financial statement data for banking companies in Indonesia. The purpose of this study is to test the effect of the level of liquidity and adequacy on bank performance through interest rate risk and credit risk empirically. The assessment of bank performance greatly influences the comfort and confidence of prospective customers. An important objective of liquidity management is to determine and assess the bank's condition, whether it is in a healthy condition when carrying out operational activities or other activities, such as lending. The results show that all hypotheses are accepted, which means that the IRR harms the bank's ability to manage the income received by the costs incurred, influenced by the interest rate. The interest rate is determined by preference and supply of money.



Keywords: liquidity, capital adequacy ratio, return on asset, interest rate risk, agency theory.




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