Optimize credit interest rates

Oct 13, 2025 by talynt.org 138 views

Analysis of Factors Affecting the Level of Troubled Credit at PT. Bumiasih People's Credit Bank NBP 34 Pematang Siantar

Introduction

In the banking industry, one of the most significant challenges faced by financial institutions is the high level of problem loans. PT. Bumiasih Rakyat NBP 34 Credit Bank, located in Pematang Siantar, is no exception. The bank, like many others, has struggled to manage its credit portfolio effectively, resulting in a significant number of troubled loans. This study aims to analyze the factors that affect the level of problem loans at PT. Bumiasih Rakyat Credit Bank NBP 34, with a focus on understanding the relationships between credit interest rates, inflation, the amount of credit given, and the number of debtors.

Methodology

This study uses time series data from 2005 to 2010 to analyze the factors affecting the level of problem loans at PT. Bumiasih Rakyat Credit Bank NBP 34. The Ordinary Least Squares (OLS) method is employed to estimate the results of the study. The independent variables used in this study are credit interest rates (X1), inflation (X2), the amount of credit given (X3), and the number of debtors (X4). The dependent variable is the level of problem loans (Y).

Results

The estimation results show that the coefficient of determination (R²) is 50.9%. This means that the independent variable consisting of credit interest rates (X1), inflation (X2), the amount of credit given (X3), and the number of debtors (X4) affects the level of problem loans (Y) of 50.9%. The remaining 49.1% is explained by other variables that are not included in the estimated model. Interaction between variables also shows that together, this independent variable affects the dependent variable, which is proven from a greater F-count value compared to F-table (4,296> 3.13) at a 95% confidence level.

T-Test Results

Through the t-test, it was found that the variable X1 (credit rate) had a significant positive influence on the 95% confidence level. Meanwhile, the variable X2 (inflation) and X3 (the amount of credit given) did not show a significant negative impact at the same level of trust. On the other hand, the variable X4 (the number of debtors) shows a significant positive effect on the 95% confidence level.

Additional Analysis and Explanation

The high credit interest rate (X1) will generally increase the burden of debtor installments, so that it has the potential to trigger problem loans if the debtor is unable to fulfill its obligations. In the context of PT. Bumiasih Rakyat Credit Bank NBP 34, the right interest rate selection is very important to maintain the health of the credit portfolio.

Inflation (X2), on the other hand, can affect people's purchasing power. When inflation increases, the value of money is reduced, which can make the debtor difficult to pay debt. The results showed that inflation did not have a negative significant effect, possibly because the bank had implemented a good risk mitigation policy.

The amount of credit given (X3) and the number of debtors (X4) also contribute to the level of problem loans. Although the amount of credit given does not have a significant effect, the number of debtors shows a positive effect. This indicates that an increase in the number of debtors can be accompanied by an increase in healthy credit distribution, as long as the bank conducts a careful credit analysis to assess the feasibility of the debtor.

Policy Implications

Appropriate policy decisions based on this analysis are very important to reduce the risk of problem loans. PT. Bumiasih Rakyat Credit Bank NBP 34 needs to optimize credit risk management, including in determining interest rates, inflation monitoring, and evaluating credit feasibility criteria for new debtors. Thus, it is expected that the level of problem loans can be minimized, and bank financial health can be maintained properly.

Conclusion

In conclusion, this study has analyzed the factors affecting the level of problem loans at PT. Bumiasih Rakyat Credit Bank NBP 34. The results show that credit interest rates, inflation, the amount of credit given, and the number of debtors all have a significant impact on the level of problem loans. The bank needs to optimize its credit risk management to reduce the risk of problem loans and maintain its financial health.

Recommendations

Based on the findings of this study, the following recommendations are made:

Optimize credit interest rates: The bank should optimize its credit interest rates to reduce the burden of debtor installments and minimize the risk of problem loans.
Monitor inflation: The bank should monitor inflation to understand its impact on people's purchasing power and adjust its credit policies accordingly.
Evaluate credit feasibility criteria: The bank should evaluate its credit feasibility criteria for new debtors to ensure that they are able to repay their debts.
Conduct careful credit analysis: The bank should conduct careful credit analysis to assess the feasibility of debtors and minimize the risk of problem loans.

By implementing these recommendations, PT. Bumiasih Rakyat Credit Bank NBP 34 can reduce the risk of problem loans and maintain its financial health.
Frequently Asked Questions (FAQs) about Analysis of Factors Affecting the Level of Troubled Credit at PT. Bumiasih People's Credit Bank NBP 34 Pematang Siantar

Q: What is the main objective of this study?

A: The main objective of this study is to analyze the factors that affect the level of problem loans at PT. Bumiasih Rakyat Credit Bank NBP 34, with a focus on understanding the relationships between credit interest rates, inflation, the amount of credit given, and the number of debtors.

Q: What are the independent variables used in this study?

A: The independent variables used in this study are credit interest rates (X1), inflation (X2), the amount of credit given (X3), and the number of debtors (X4).

Q: What is the dependent variable in this study?

A: The dependent variable in this study is the level of problem loans (Y).

Q: What is the methodology used in this study?

A: This study uses time series data from 2005 to 2010 to analyze the factors affecting the level of problem loans at PT. Bumiasih Rakyat Credit Bank NBP 34. The Ordinary Least Squares (OLS) method is employed to estimate the results of the study.

Q: What are the results of the t-test?

A: Through the t-test, it was found that the variable X1 (credit rate) had a significant positive influence on the 95% confidence level. Meanwhile, the variable X2 (inflation) and X3 (the amount of credit given) did not show a significant negative impact at the same level of trust. On the other hand, the variable X4 (the number of debtors) shows a significant positive effect on the 95% confidence level.

Q: What are the implications of the study's findings?

A: The study's findings have significant implications for PT. Bumiasih Rakyat Credit Bank NBP 34. The bank needs to optimize its credit risk management, including in determining interest rates, inflation monitoring, and evaluating credit feasibility criteria for new debtors. Thus, it is expected that the level of problem loans can be minimized, and bank financial health can be maintained properly.

Q: What are the recommendations based on the study's findings?

A: Based on the findings of this study, the following recommendations are made:

Optimize credit interest rates: The bank should optimize its credit interest rates to reduce the burden of debtor installments and minimize the risk of problem loans.
Monitor inflation: The bank should monitor inflation to understand its impact on people's purchasing power and adjust its credit policies accordingly.
Evaluate credit feasibility criteria: The bank should evaluate its credit feasibility criteria for new debtors to ensure that they are able to repay their debts.
Conduct careful credit analysis: The bank should conduct careful credit analysis to assess the feasibility of debtors and minimize the risk of problem loans.

Q: What are the limitations of this study?

A: This study has several limitations, including:

Data limitations: The study uses time series data from 2005 to 2010, which may not be representative of the current situation.
Methodological limitations: The study uses the Ordinary Least Squares (OLS) method, which may not be the most appropriate method for analyzing the data.
Theoretical limitations: The study assumes that the relationships between the independent variables and the dependent variable are linear, which may not be the case in reality.

Q: What are the future research directions based on this study?

A: Based on this study, several future research directions can be identified, including:

Extending the study period: The study can be extended to include more recent data to see if the relationships between the independent variables and the dependent variable have changed over time.
Using alternative methods: Alternative methods, such as the Generalized Method of Moments (GMM) or the Instrumental Variables (IV) method, can be used to analyze the data.
Including additional variables: Additional variables, such as the credit score of the debtor or the type of credit product offered, can be included in the analysis to see if they have an impact on the level of problem loans.