Revenue Diversification, Performance, and Bank Risk: Evidence from Indonesia  

Oleh:

Hafidiyah, Mutiara Nur ; Trinugroho, Irwan

Jenis: Article from Journal - ilmiah nasional - terakreditasi DIKTI
Dalam koleksi: Jurnal Dinamika Manajemen vol. 7 no. 02 (2016), page 139-148.
Topik: Revenue Diversification; Bank Performance; Bank Risk; Conventional Bank; Indonesia
Fulltext: 8198-18162-3-PB_ros.pdf (389.77KB)

Isi artikel

There have been a number of studies on the implication of revenue diversification especially on bank performance and risk, both in the context of developed and emer-ging countries. This paper examines the effect of revenue diversification on bank performance and bank risk by studying 101 conventional commercial banks in In-donesia over the period of 2010-2014 resulting in 505 observations. By employing panel least square technique, our results show that revenue diversification negatively affects bank performance. From the findings, we can conclude that diversified banks are riskier than specialized banks. The risk is diminished when state-owned banks diversify their business. Joint venture banks are riskier than other banks when they engage in non-interest income activities.

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