Intermediary Function, Capital Structure, Financing Risk and Financial Performance at Islamic Banks in Indonesia

Abstract

This study aims to examine the influence of intermediary function and capital structure toward financing risk and financial performance and the influence of risk toward financial performance at sharia bank in Indonesia. The type of research used in this research is explanatory research, which is research that explains the effect of exogenous variables consist of intermediary function and capital structure toward endogenous variables consist of financing risk and financial performance through a hypothesis test. The sample of this research is sharia bank in Indonesia. The data used is scondary data of 11 sharia banks during period of 2013 to 2017. The method of data analysis uses partial least square with the consideration that the total samples used are small. The results showed that (a) capital structure have a significant influence on the financing risk of sharia bank in Indonesia; (b) capital structure have a significant influence on the financial performance of sharia bank in Indonesia; (c) intermediary function have a significant influence on the financing risk of sharia bank in Indonesia; (d) intermediary function have no a significant influence on the financial performance of sharia bank in Indonesia and (e) financing risk have a significant influence on the financial performance of sharia bank in Indonesia.