The Influence Of Banking Performance With The Islamicity Performance Index Approach On Return On Asset At Islamic Commercial Banks In Indonesia In 2014-2023

Abstract

Introduction: Islamic bank have a role as financial internediaries whose operational activities must be in accordance with sharia principles. In order for the operations of Islamic bank to run well, a performance evaluation is needed that is not only from the financial side which is wordly, but also the ukhrawi because the goal of sharia is to achive falah, namely wordly and hereafter welfare. This study aims to analyze the effect of the Islamic Commercial Banks on Return On Asset in Indonesia in 2014-2023. Research Methods: This research method is quantitative using panel data regression analysis with secondary data. Results: The result of the study show that the independent variables profit sharing ratio, equitable distribution ratio, and director employee welfare ratio have a significant positive effect on return on asset. While the zakat performance ratio has a positive but insignificant effect on ROA and Islamic income vs non Islamic income ratio has a negative but insignificant effect on ROA. Conclusion: If PSR, EDR, and DEWR increase, it will increase the profits of Islamic commercial banks, while ZPR and I.INC do not have a significant effect on the rise and fall of Islamic commercial bank profits.