Bank group performance grouping model based on core capital in top banks during the pandemic in Indonesia

Abstract

This study investigates the health levels of Core Capital 4 banks during the COVID-19 pandemic by employing methods that focus on credit risk and profitability. Designed as a comparative analysis, the research examines differences in the financial health of these banks prior to and throughout the pandemic. The study population consists of 46 banks listed on the Indonesia Stock Exchange, with a purposive sampling technique applied to select four banks that meet specific criteria relevant to the study’s objectives. The analysis relies on secondary data, specifically annual financial statements published by each of the selected banks. The collected data were processed using descriptive statistical methods to provide an overview of the key financial indicators. Furthermore, the Analysis of Variance (ANOVA) test was employed to examine credit and capital risk indicators, revealing significant differences in the health levels of core capital 4 banks when comparing the pre-pandemic and pandemic periods. Previous studies have examined bank health in the context of mergers, Islamic banking, or comparisons with conventional banks, but few have focused on core capital 4 banks as Indonesia’s largest group. Limited research has highlighted how these large-capital banks were specifically affected by the COVID-19 pandemic. This study addresses that gap by comparing their credit risk and profitability before and during the crisis.