Research Article
Are the Social Concern Policies of Islamic Banks Caused by Economic Motives? Empirical Evidence on Islamic Banks in Indonesia
@INPROCEEDINGS{10.4108/eai.25-6-2019.2287983, author={Hasan Mukhibad and Prabowo Yudo J and Indah Anisykurlillah}, title={Are the Social Concern Policies of Islamic Banks Caused by Economic Motives? Empirical Evidence on Islamic Banks in Indonesia}, proceedings={Proceedings of the 1st International Symposium on Indonesian Politics, SIP 2019, 26-27 June 2019, Central Java, Indonesia}, publisher={EAI}, proceedings_a={ISIP}, year={2019}, month={9}, keywords={social fund distribution policy credit risk profit sharing risk; capital risk}, doi={10.4108/eai.25-6-2019.2287983} }- Hasan Mukhibad
Prabowo Yudo J
Indah Anisykurlillah
Year: 2019
Are the Social Concern Policies of Islamic Banks Caused by Economic Motives? Empirical Evidence on Islamic Banks in Indonesia
ISIP
EAI
DOI: 10.4108/eai.25-6-2019.2287983
Abstract
This research aims to demonstrate empirically whether banks’ concern for society and the environment, as measured by the increase in social funds, is based on economic motives (changes in profit sharing, capital, funding, credit risk and profitability). The population is Islamic banks in Indonesia and a sample of 11 banks was determined using the purposive sampling method and with observations from the period 2014 to 2017. The data analysis uses the Structure Equation Model aided by the WarpPLS tool. The results demonstrate that there is no relationship between changes in the level of profit sharing, changes in Non-Performing Financing, and changes in profitability to the policy of channeling social funds. Changes in capital and funding received by banks have low significant influence on the policy of channeling social funds. These results indicate that there is no strong proof that the policy of channeling social funds is caused by economic motives