The effect of macroeconomics variables on Islamic Bank stability during COVID-19 Pandemic: Evidence from Indonesia

Hamda, Ikrima and Sudarmawan, Barianto Nurasri ORCID: https://orcid.org/0000-0002-9209-8687 (2023) The effect of macroeconomics variables on Islamic Bank stability during COVID-19 Pandemic: Evidence from Indonesia. Islamic Review: Jurnal Riset dan Kajian Keislaman, 12 (1). pp. 59-76. ISSN 2654-4997

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Abstract

esearch that traces the impact of COVID-19 on Islamic banking has been carried out by many previous researchers in the last two years. However, no researcher has discussed specifically related to Islamic banking stability related to macroeconomic relaxation during the COVID- 19 pandemic. The purpose of this study is to trace the influence of macroeconomics on the stability of Islamic banking during COVID-19 in anticipation of similar shocks. This study uses multiple linear regression tests to see macroeconomic factors consisting of GDP, Inflation, BI Rate, Exchange Rate, and JUB as independent variables and CAR, NOM, and NPF as control variables on z-score as dependent variables. The results of the study showed that the GDP variable had a significant negative influence while the BI Rate and Exchange Rate variables had a significant positive effect on the stability of Islamic banking during the COVID-19 pandemic. As well as inflation variables and JUB showed insignificant results. The stable condition of Islamic banking is indicated by the intermediation function in Islamic banking that runs smoothly and can survive various kinds of shocks. This proves that during the COVID-19 pandemic the Government has succeeded in taking several policies that have proven effective in taking policies in running the economy which have an impact on the resilience of Islamic banking stability.

Item Type:	Journal Article
Keywords:	Islamic Bank; Z-Score; bank stability; COVID-19 pandemic
Subjects:	14 ECONOMICS > 1402 Applied Economics > 140207 Financial Economics
Divisions:	Faculty of Economics > Department of Islamic Banking
Depositing User:	Barianto Nurasri Sudarmawan
Date Deposited:	15 Nov 2023 10:13

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