CREDIT RISK AND MACROECONOMICS OF ISLAMIC BANKING IN INDONESIA

Kharisya Ayu Effendi, Rozmita Dewi Yuniarti

Abstract


The purpose of this study is to analyze the effect of macroeconomic variables, namely GDP, Inflation and Unemployment to credit risk of Islamic banking of Indonesia. The data for this study were collected from secondary sources via Statistics Center Indonesia (BPS) and financial statements of the 7 islamic bank of Indonesia.  The data used are the annual ones  from 2009 to 2016. This research uses an explanatory analysis. The test is a panel data regression testing using Eviews 9. The result of panel data regression with random effect model consisted gross domestic product (GDP) and unemployment rate (UNEMP) have a significant negative effect on credit risk of Islamic banking in Indonesia. While the inflation variable has a negative but statistically insignificant on credit risk of Islamic banking system of Indonesia


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