Liquidity and Asset Quality on Sustainable Growth Rate of Banking Sector

International Journal of Science and Research (IJSR), 2019

4 Pages Posted: 27 Oct 2019 Last revised: 1 Nov 2019

See all articles by Ahmad Aziz Putra Pratama

Ahmad Aziz Putra Pratama

Airlangga University, Faculty of Economics and Business, Master of Science in Management, Students

Date Written: October 4, 2019

Abstract

Bank focused how to increase profit. But, sustainability of growth is more important. This study examines the effect of liquidity and asset quality on sustainable growth rate in banking sector. Purposive sampling based on the criteria selected 23 banks in 2010-2017 period with 174 observations. Using panel data regression, the results showed that liquidity and bad asset quality had a significant negative effect on sustainable growth rate. This result showed that sustainable growth rate becomes important related to the bank’s strategy to continue and grow in order to expand its business maximally while maintaining funding sources.

Keywords: Sustainable growth rate, liquidity, asset quality, banking sector

JEL Classification: G20, G21, G40

Suggested Citation

Pratama, Ahmad Aziz Putra, Liquidity and Asset Quality on Sustainable Growth Rate of Banking Sector (October 4, 2019). International Journal of Science and Research (IJSR), 2019. Available at SSRN: https://ssrn.com/abstract=3470745

Ahmad Aziz Putra Pratama (Contact Author)

Airlangga University, Faculty of Economics and Business, Master of Science in Management, Students ( email )

Surabaya
Indonesia
082135948540 (Phone)

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