DOES SIZE AFFECT LOAN PORTFOLIO STRUCTURE AND PERFORMANCE OF DOMESTIC-OWNED BANKS IN INDONESIA?

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Apriani Dorkas Rambu Atahau ORCID logo, Tom Cronje ORCID logo

https://doi.org/10.22495/cocv13i1c3p7

Abstract

Domestic-owned banks (DBs) represent almost 40% of the overall number of banks in Indonesia. The objective of this study is to determine whether small and large Indonesian DBs differ in terms of their loan portfolio structures and performance. No previous studies addressed this issue. The study is based on 9 year loan portfolio structure and performance data of 69 large and 346 small Indonesian DBs. Descriptive statistics, univariate statistics and panel data regression are applied. The findings from univariate statistics show that the loan portfolio structures and returns of small and large DBs differ significantly. However, panel data regression shows that only the loan portfolio return-risk relationship of small and large DBs differs significantly.

Keywords: Domestic-owned Banks, Indonesia, Loan Portfolio Structures, Loan Portfolio Performance

How to cite this paper: Atahau, A.D.R., Cronje, T. (2015). Does size affect loan portfolio structure and performance of domestic-owned banks in Indonesia? Corporate Ownership & Control, 13(1-3), 389-400. https://doi.org/10.22495/cocv13i1c3p7