Foreign Banks Lending During the Crisis; Do Profitability and Liquidity Matter?

DOI

10.2991/miceb-17.2018.20How to use a DOI?

Keywords

foreign banks, credit, global financial crisis, capital, liquidity, and profitability

Abstract

The purpose of this study is to assess the impact of the global economic crisis in 2008-2009 on loan growth in foreign banks in Indonesia. Using Indonesian banking industry data, I constructed a panel of 1,372 bank-year observations for 98 banks in Indonesia, which includes 20 bank-year observations for foreign-owned banks. The analysis of data in this research used data panel regression method. The results show that the loan growth of foreign bank is stable during crisis because those foreign banks in Indonesia serve as more 'crisis-mitigating impact' for their respective parent bank. In addition, profitability and liquidity are found to weaken the effect of crisis on the loan growth, as more foreign banks being more cautious in lending during the crisis

Copyright

© 2018, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Rizky Yudaruddin
PY  - 2017/10
DA  - 2017/10
TI  - Foreign Banks Lending During the Crisis; Do Profitability and Liquidity Matter?
BT  - Proceedings of the Mulawarman International Conference on Economics and Business (MICEB 2017)
PB  - Atlantis Press
SP  - 126
EP  - 130
SN  - 2352-5428
UR  - https://doi.org/10.2991/miceb-17.2018.20
DO  - 10.2991/miceb-17.2018.20
ID  - Yudaruddin2017/10
ER  -