Analysis Of Company Value Of Banking Sub-Sector On The Indonesian Stock Exchange
DOI:
https://doi.org/10.24256/kharaj.v7i2.7492Keywords:
Capital Adequacy Ratio (CAR), Loan to Deposit Ratio (LDR), Company Value, Operational Efficiency Ratio (OER)Abstract
This study aims to examine the impact of the Capital Adequacy Ratio
(CAR), Loan to Deposit Ratio (LDR), and Operational Efficiency Ratio
(OER) on firm value in the conventional banking sub-sector listed on the
Indonesia Stock Exchange for the 2021–2023 period. This study uses a
quantitative approach with purposive sampling techniques and multiple
linear regression analysis methods. Data were obtained from the annual
financial reports of sampled conventional banking companies over a threeyear period, then analyzed using SPSS version 29. The results show that
CAR contributes to increasing firm value, reflecting the importance of
capital strength in attracting investor confidence. LDR is also proven to
contribute to firm value, where the level of credit distribution is an important
consideration for investors in assessing the health and viability of a bank.
Meanwhile, OER does not make a significant contribution to firm value,
so operational cost efficiency has not been a primary focus for investors in
assessing banking performance in the capital market. These findings
indicate that capital strength and the level of credit distribution play an
important role in influencing investor perceptions of firm value, while
operational efficiency has not been a primary factor in determining firm
value
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