The Examining the Capital Structure Determinants: Empirical Analysis of Regional Development Banks In Indonesia

Agustin, Hamdi and Karya, Detri and Suyadi (2016) The Examining the Capital Structure Determinants: Empirical Analysis of Regional Development Banks In Indonesia. Prosiding The 13th Ubaya International Annual Symposium on Manajement. p. 23. ISSN 976-604-73-4020-0

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Abstract

One of the unique banking in Indonesia is that there are regional development banks (RDB), which is a government-owned bank districts. Regional development banks categorized as focused bank, ie the bank with regional focus. The objective of this research is determinants of capital structure in region development bank (Bank Pembangunan Daerah). The external variables of the economy of a country in Indonesia are regional autonomy, bank policy of government and economic crisis. The internal factor or characteristics of an individual bank are loans, size and profitability. The population consists of 26 community development banks. The study 14 regional development banks because of difficulty in getting the data. The period under study is from 1995 to 2010. In this study using panel data and analysis using pooled ordinary least square (OLS) and random effect. The results showed the regional autonomy negative influence on leverage because obtain additional funds from the local government. Dummy equity (policy government) positive influence on leverage the showed that regional development banks of equity have more than 100 billion would increase the amount of debt and the crisis negative influence on leverage because RDB reduces the amount of debt to avoiding from bankruptcy. Internal variables showed loans negative influence on leverage, assets positive influence on leverage, while profitability has not influence different from previous studies.

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