COMPARATIVE ANALYSIS OF FINANCIAL AND RISK MANAGEMENT (IN TERMS OF CAR, ROA, NPF, FDR, AND BOPO) BETWEEN ISLAMIC BANKING AND CONVENTIONAL BANKING 2018–2022

Abstract

This study aims to analyze the differences in financial management and risk between Islamic and conventional banking during the period 2018-2022. The key variables studied include capital adequacy ratio (CAR), return on assets (ROA), non-performing financing (NPF), funding to deposit ratio (FDR), and operating cost, operating income/revenue (BOPO). This type of research uses mixed methods, with the design used in this research is a simultaneous triangulation strategy (balanced mixture). This research uses non-probability sampling technique with purposive sampling method. Data analysis techniques using descriptive statistical analysis. The results of this study indicate that there are differences in the financial performance of conventional banks and Islamic banks in the ROA and BOPO ratios, while in the CAR, NPF and FDR ratios there are no significant differences in the financial performance of conventional banks and Islamic banks. When viewed from the average ratio, this study shows that the CAR, NPF, FDR and BOPO ratios in the Islamic banking industry are higher than the conventional banking industry, but the ROA ratio in the conventional banking industry is higher so that the efficiency of asset utilization in the conventional banking sector is higher to generate profits. Overall, these results provide further insight into the differences in financial management and risk management between Islamic and conventional banks