STUDY ON THE EFFECT OF SIZE AND MARKET CONCENTRATION TOWARDS EARNINGS VOLATILITY IN INDONESIAN BANKS

REYVAZZAHRA AZARIA H, John Eddy Junarsin, S.E., M.B.A, Ph.D.

2018 | Skripsi | S1 MANAJEMEN

INTISARI Penelitian Penelitian ini bertujuan untuk menguji pengaruh size dan market concentration terhadap earnings volatility pada bank-bank di Indonesia. Size bank dalam penelitian ini diukur dengan log dari total revenue, sementara untuk market concentration dihitung menggunakan Indeks Herfindahl-Hirschman. Sedangkan untuk earnings volatility, dihitung dengan menggunakan volatilitas Return on Asset selama empat dan delapan kuartal terakhir. Kemudian, setelah mengetahui pengaruh size dan market concentration terhadap earnings voltility, interaksi antara dua variabel independen akan dianalisis untuk melihat apakah akan mengubah hubungan mereka dengan variabel dependen. Variabel lain juga ditambahkan dalam penelitian ini sebagai variabel kontrol, seperti leverage, diversity, dan efficiency. Dari analisis data panel yang telah dilakukan, tampak bahwa semua variabel dalam persamaan secara signifikan mempengaruhi earnings volatility. Setelah itu, efek dari setiap variabel juga diperiksa untuk membantu memberikan pemahaman yang lebih baik mengenai situasi penelitian. Kata Kunci: Earnings Volatility, Size, Market Concentration, Volatilitas ROA, Total Revenue.

ABSTRACT This research aims to examine the effect of size and market concentration towards earnings volatility in Indonesian banks. The banks’ size in this research is measured by the log of total revenue, while market concentration is calculated using the Herfindahl-Hirschman Index. While for earnings volatility, it is calculated by examining the volatility of Return on Asset over the last four and eight quarters. Later, after knowing the effect of size and market concentration towards earnings volatility, the interaction between the two independent variables will be analyzed to see whether it will change their relationship with the dependent variable. Other variables also added in this research as control variables, such as leverage, diversity, and efficiency. From the panel data analysis that has been conducted, it appears that all variables in the equation significantly affect earnings volatility. Afterward, the effect of each variable is also examined to help to give a better understanding of the research situation. Keywords: Earnings Volatility, Size, Market Concentration, ROA Volatility, Total Revenue.

Kata Kunci : Earnings Volatility, Size, Market Concentration, ROA Volatility, Total Revenue.