The Bank Bankruptcy Prediction Models Based On Financial Risk
Abstract
The Shocks In Banking Industry Became One Of Economy Instability Factor. Hence, Bank Has To Be Prevented From Bankrupt Condition Which Can Be Spread To Be Banking Crisis, Because Its Potentially Impact On Cost Of Bankruptcy And Social Distrust. The Failure Of A Bank Which Ends With Bankruptcy Is Not Suddenly Happen, But Started By Various Problems As Financial Indicators At Below Standars, Such As: High Non Performing Loan (NPL), Low Net Interest Margin (NIM), Low Liquidity Problem (GWM), Low Efficiency Level (High BOPO), Low Capital Adequacy Ratio (CAR). In Order To Anticipate And Prevent That Condition, Prediction Models Which Can Give Early Signal Of Bank Bankruptcy Is Needed. This Study Is Purposed To Make Bank Bankruptcy Prediction Models Based On Time Dimension And Bank Groups Using Financial Ratios Which Are Expected Can Influence Bank In Bankrupt Condition. Beside Documentation Study And Verificative Analysis To Bank Financial Report, Survey Method To Bankrupt Bank And Nonbankrupt Bank Population Is Used To Get Data. Econometric Models With Linear Discriminant Analysis Technique Is Used To Find Distinguishing (Discriminator) Variables Of Bankrupt Bank And Nonbankrupt Bank. Then, It Is Continued With Logistic Regression Analysis, Proposed To Find Variables Which Influence (Estimator) To Bank Bankruptcy. The Results Found Discriminator Variables As Many As 27 Financial Ratios, And Estimator Variables As Many As 20 Financial Ratios. Bankruptcy Prediction Models That Meet The Criteria Of Goodness Of Fit Are: MP-6, MP-12, MP-24, MP-BK, And MP-BB. While The Dominant Risk Rating On Bank Bankruptcy Are: RP, RK, RL, RM, And RO.