An Implementation of Good Corporate Governance in Rural Bank

DOI

10.2991/aebmr.k.200305.158How to use a DOI?

Keywords

rural bank, GCG, OJK, core capital

Abstract

The Rural bank is a formal microfinance institution that provides services to rural and suburban communities, including managers of Micro, Small and Medium Enterprises (MSMEs). The existence of rural banks can sustain the regional economy and create regional economic growth. As a financial institution that plays a role in the regional economy, in practice, there needs to be good Good Corporate Governance (GCG) which will ultimately bring rural bank’s performance to be better. The purpose of this study is to assess the implementation and practice of Good Corporate Governance (GCG) in one of the rural banks in the Pariaman City, West Sumatera, namely PT BPR La Mangau Sejahtera. This research uses a mixed-method in the form of qualitative and quantitative methods. Qualitative data were obtained through interviews with rural bank’s directors. Quantitative data were obtained by distributing questionnaires to BPR directors and also sourced from financial statements. The data analysis technique used is descriptive quantitative. The results of this study indicate that the implementation of GCG at PT. BPR La Mangau Sejahtera is included in the good category but needs to be increased in the future. It is recommended to PT.BPR La Mangau to further enhance its GCG because, by the end of 2019, the financial services authority (OJK) will implement regulations that require rural bank with core capital of under Rp 3 billion to merge. This can be anticipated if PT. BPR La Mangau Sejahtera can increase its core capital to a minimum of Rp 3 billion. Therefore, with an increase in good corporate governance, it is expected that PT.BPR La Mangau Sejahtera can achieve better performance.

Copyright

© 2020, 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  - Abel Tasman
AU  - Fifka Amelia Susanti
PY  - 2020
DA  - 2020/03/10
TI  - An Implementation of Good Corporate Governance in Rural Bank
BT  - Proceedings of the 4th Padang International Conference on Education, Economics, Business and Accounting (PICEEBA-2 2019)
PB  - Atlantis Press
SP  - 910
EP  - 914
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.200305.158
DO  - 10.2991/aebmr.k.200305.158
ID  - Tasman2020
ER  -