| dc.description.abstract | Assessment of the soundness of a bank is a qualitative assessment of various
aspects that affect the condition or performance of a bank through assessing
aspects of capital, asset quality, management, earnings, liquidity, and sensitivity
to market risk. The assessment of bank health as regulated in the circular
previously used the CAMEL (Capital, Asset, Management, Earning, Liquidity)
method. Assessment of the soundness of a bank using the CAMEL method includes
the factors Capital (capital), Assets (asset quality), Management (management),
Earning (rentability), Liquidity (liquidity). The aim of implementing banking
operational activities is to obtain high financial performance by looking at the
level of banking profitability. The profitability ratio used is Return On Asset s
(ROA) because for banks it measures the company's effectiveness in generating
profits by utilizing the assets it owns.
Ratios that can be used in measuring a bank's financial performance. Where
the ratio used to measure operating efficiency can be measured by Operating
Expenses and Operating Income (BOPO) used to measure the Bank's Efficiency
Level and ability to carry out operational activities. To measure credit, it can be
measured by Non-Performance Loans (NPL), which is used to measure the
amount of unpaid or uncollectible loans. To measure market risk, it can be
measured by Net Interest Margin (NIM), which is used to measure interest income
on productive assets. To measure capital, it can be measured by the Capital
Adequacy Ratio (CAR). It is used to measure capital capacity and cover losses in
credit activities and securities. To measure liquidity, it can be measured by the
Loan to Deposit Ratio (LDR). It is used to measure a bank's ability to meet the
withdrawal of third party funds by customers using credit or loans provided by the
bank. | en_US |
