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SUMMARY
PUTRI CITRA MANDIRI HARIANTO. Banking Efficiency Analysis Before and After Mergers. Supervised by TANTI NOVIANTI and BUNASOR SANIM
In 2006, Bank Indonesia issued a Single Presence Policy (SPP). The main objective of this regulation is to create a robust Indonesia banking structure which also stated in Arsitektur Perbankan Indonesia Pillar 1. A consolidation process between banks will be required to achieve this goal. One of the consolidation process that could be implemented is ownership restructuring through the application of Single Presence Policy.
This study purposes to measure the impact of consolidation process through mergers for banks that impacted by SPP regulations. The methodology for this study is Two-Stage Data Envelopment Analysis with Tobit Regression. Timeframe for this this study is twelve quarterly before and twelve quarterly after merger and/or acquisition commencement. Bank’s efficiency is measured using total deposits, fixed asset and Non-Interest Expense as input and total loan and Other Operating Income as output.
DEA resulted that efficiency score on post-merger is relatively more efficient than premerger. Tobit regression model is employed to determine factors affecting bank efficiency and we noted for pre-merger that Bank Size (TA), ROA and NPL has significant effect to Bank’ efficiency. However for post-merger, Bank Size (TA), CAR and ROA has a significant effect to Bank’ efficiency.
Keywords: data envelopment analysis, efficiency, merger, single presence policy, tobit regression
