Impact of Non-Performing Loans, Loan to Deposit Ratio and Education Diverstiy on Firm Performance of Indonesia Banking Sectors


  • Nugi Mohammad Nugraha Faculty of Economics & Business, Widyatama University Bandung
  • Adibah Yahya Universitas Pelita Bangsa, Bekasi
  • Talitha Nathaniela Nariswari, Fida Salsabila Faculty of Economics & Business, Widyatama University Bandung


Non-Performing Loan; Loan to Deposit Ratio; Return on Assets.


The banking industry has a significant role in creating equity and supporting economic growth. However, the quantity of banks is increasing day by day, creating a tight gap, where lowers the performance of a bank because it is unable to compete in the market; so many banks are not healthy and even financially unhealthy. This study aims to determine the effect of Non-Performing Loans, education diversity and Loan to Deposit Ratio on Return on Assets in Conventional Banking listed on the Indonesia Stock Exchange for the period 2015 to 2019 as per the geographical location, as the effect of loans vary on the basis of geographical perspectives. The research method used in this study is quantitative with panel data. The technique used was purposive sampling to obtain a sample of 33 companies from a population of 41 companies. The data analysis technique used in this research is descriptive statistical analysis, the coefficient of determination test, the F test, and the t-test. Data processing used SPSS 20. The results showed that the Non-Performing Loan, the Loan to Deposit Ratio and education diversity simultaneously had a significant effect on Return on Assets. Partially, NonPerforming Loans have a significant negative effect on Return on Assets, and the Loan to Deposit Ratio has a significant positive effect on Return on Assets. The return on assets and effect of loan were found to vary as per the geographical variations.