Loan Diversification, Market Concentration, and Stability in the Indonesian Banking Industry

DOI

10.2991/assehr.k.210531.063How to use a DOI?

Keywords

Diversification, Stability, Concentration, Bank

Abstract

This study aims to investigate the impact of loan diversification, market concentration, and the interaction effect of loan portfolio diversification and market concentration on banks’ stability in Indonesia. The observation includes 62 commercial banks from Indonesia with an annual data period of 2010–2017. By employing a panel regression technique with fixed effect models, the findings suggest that loan portfolio diversification decreased bank stability. However, market concentration does not significantly affect bank stability. The results of this study also indicate that the stability of diversifying banks may differ in concentrated and less concentrated markets.

Copyright

© 2021, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Nabila Sheila Meutia
AU  - Dony Abdul Chalid
PY  - 2021
DA  - 2021/05/31
TI  - Loan Diversification, Market Concentration, and Stability in the Indonesian Banking Industry
BT  - Proceedings of the Asia-Pacific Research in Social Sciences and Humanities Universitas Indonesia Conference (APRISH 2019)
PB  - Atlantis Press
SP  - 496
EP  - 504
SN  - 2352-5398
UR  - https://doi.org/10.2991/assehr.k.210531.063
DO  - 10.2991/assehr.k.210531.063
ID  - Meutia2021
ER  -