Skip to main content
alam.amiki@gmail.com 6281260272238
Register
Articles

The Effect of Non-Performing Loans, Loan to Deposit Ratio, and Capital Adequacy Ratio on Profitability in State-Owned Banks for the 2018-2024 Period

  • 1* Universitas Pamulang.

* Corresponding Author: Ferdina Watiningsih

Open Access
DOI
https://doi.org/10.59431/ijer.v6i1.637
Published
Pages
291-299

Issue

Vol. 6 No. 1 (2026)

Indonesian Journal Economic Review (IJER)
March

Abstract

This study aims to examine the influence of Non-Performing Loan (NPL), Loan to Deposit Ratio (LDR), and Capital Adequacy Ratio (CAR) on profitability measured using Return on Assets (ROA) in state-owned banks listed on the Indonesia Stock Exchange for the 2018–2024 period. The research approach used is quantitative with multiple linear regression analysis methods. The research data is sourced from the annual reports of four state-owned banks, namely PT Bank Rakyat Indonesia Tbk, PT Bank Negara Indonesia Tbk, PT Bank Mandiri Tbk, and PT Bank Tabungan Negara Tbk. The analysis process is carried out through a partial test (t-test), simultaneous test (F-test), and calculation of the determination coefficient (R²). The results of the study revealed that partially, NPL had a significant negative influence on ROA with a regression coefficient value of -0.772 and a significance level of 0.000 < 0.05. The LDR variable did not show a significant effect on ROA with a significance of 0.092 > 0.05, nor did CAR which also had no significant effect with a significance of 0.648 > 0.05. However, simultaneously these three variables were shown to have a significant effect on ROA with F calculated at 19.744 greater than F in table 2.99 and Adjusted R² value of 0.676. This means that 67.6% of ROA variations can be explained by NPLs, LDRs, and CARS, while the remaining 32.4% are influenced by other factors outside of this research model.

Keywords

NPL LDR CAR ROA

How to Cite

Watiningsih, F. (2026). The Effect of Non-Performing Loans, Loan to Deposit Ratio, and Capital Adequacy Ratio on Profitability in State-Owned Banks for the 2018-2024 Period. Indonesian Journal Economic Review (IJER), 6(1), 291-299. https://doi.org/10.59431/ijer.v6i1.637

References

  • Alnabulsi, K., & Kozarevi, E. (2023). Non-performing loans as a driver of banking distress: A systematic literature review. Journal of Banking and Finance, 111–130.
  • Aprilia, N., Subroto, W. T., & Sakti, N. C. (2025). The role of small and medium enterprises (SMEs) in supporting the people’s economy in Indonesia. International Journal of Research and Scientific Innovation (IJRSI), XI(2321), 368–376. https://doi.org/10.51244/IJRSI
  • Bank, L. D. R., & Di, U. (2015). Economics development analysis journal. Economics Development Analysis Journal, 4(3), 273–281.
  • Capital, A. (2020). Journal of Economics and Business. https://doi.org/10.31014/aior.1992.03.01.187
  • Carlos, J., Nikensari, S. I., & Zahra, S. F. (2023). Which is more influential? Internal factors or external factors of banks on the profitability of conventional banks. Arbitrase Journal, 4(2). https://doi.org/10.47065/arbitrase.v4i2.1430
  • Damayanti, A. D., & Indrabudiman, A. (2024). Pengaruh capital adequacy ratio, beban operasional dan pendapatan operasional, loan to deposit ratio, dan non-performing loan terhadap profitabilitas perbankan. Jurnal Ekonomi dan Manajemen, 2(4).
  • Khairi, A. (2021). A literature review of non-performing loan. Journal of Business Management Research, 2(5), 366–373. https://doi.org/10.47153/jbmr25.1402021
  • Kusnandar, H. F., Tasikmalaya, P. T., Mulyati, S., Tasikmalaya, P. T., Yaum, Y., Tasikmalaya, P. T., & Ketiga, D. P. (2019). Analisis loan to deposit ratio (LDR) pada PT Bank Woori Saudara Indonesia 1906, Tbk. Jurnal Manajemen Keuangan, 13(2), 115–124.
  • Manajemen, P. S., & Ageng, U. S. (2025). The role of ROA in mediating the effect of LDR and CAR on the return of conventional commercial banks' shares. Journal of Business and Finance, 8, 2491–2504.
  • Muhammad, N., & Lubis, A. W. (2025). MSME loan composition, financial stability, and government ownership: Evidence from Indonesia’s banking sector. Journal of Banking and Finance, 27(3), 321–350.
  • Muniru, S., David, N., Tom, O., & Michael, M. (2025). Non-performing loans of commercial banks: A review. International Journal of Banking Studies, 7(2), 45–60.
  • Putu, E., Maharani, B., & Putri, W. (2025). The loan-to-deposit ratio and its impact on banks. International Journal of Economics and Finance Studies, 47, 5–11.
  • Rizaldy, M., Baihaqqy, I., Prasetyo, Y., Riyanto, A., & Ernawati, N. (2025). The influence of bank characteristics on capital adequacy ratio. JURISMA: Jurnal Riset Bisnis dan Manajemen, 15(April), 121–130.
  • Tahu, G. P., Luh, N., Saputri, G., Ngr, I. G., & Gunadi, B. (2023). Pengaruh capital adequacy ratio (CAR), non-performing loan (NPL) dan loan to deposit ratio (LDR) terhadap profitabilitas pada perusahaan perbankan di Bursa Efek Indonesia. Jurnal Ekonomi dan Keuangan, 6(September), 7432–7440.
  • Tahun, R. O. A., Widyastuti, P. F., Aini, N., Ekonomika, F., & Stikubank, U. (2021). Pengaruh CAR, NPL, LDR terhadap profitabilitas bank. Jurnal Ekonomika Stikubank, 1020–1027.

Author Biographies

  • Ferdina Watiningsih, Universitas Pamulang.

    Management Study Program, Faculty of Economics and Business, Universitas Pamulang, South Tangerang City, Banten Province, Indonesia.

License

Copyright (c) 2026 Ferdina Watiningsih

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.

This is an open-access journal. All articles are distributed under the terms of the Creative Commons Attribution 4.0 International License (CC BY 4.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Under this license, you are free to:

  • Share: Copy and redistribute the material in any medium or format.
  • Adapt: Remix, transform, and build upon the material for any purpose, even commercially.

Attribution Requirements:
You must give appropriate credit, provide a link to the license, and indicate if changes were made. You may do so in any reasonable manner, but not in any way that suggests the licensor endorses you or your use.

Copyright and Retention:
Authors retain copyright without restrictions and grant this journal the right of first publication under an open-access model. The journal retains non-exclusive publishing rights for archiving, indexing, and scholarly dissemination.

Usage Statistics