The Influence of Financing Against Profitability at Bank Syariah in
Indonesia in General 2010-2016
Yola Yunisa Pratami, Kusnendi Kusnendi and Heraeni Heraeni
Economics and Islamic Finance Department, Universitas Pendidikan Indonesia, Jl. Dr. Setiabudhi, Bandung, Indonesia
Keyword: trade financing, profit-loss sharing financing, lease financing, profitability (ROA).
Abstract: The aim of this study is to test empirically about effects of trade financing, profit-loss sharing financing, and
lease financing to profitability rate. The objects that used in this study is seven Islamic Commercial Banks
which giving the three types of financing in 2010-2016 period. This research uses quantitative approach by
using panel data. The data analysis technique in this study uses panel data regression with common effect
model. The results of study show that trade financing and lease financing have positive effect on
profitability. Therefore, profit-loss sharing financing has negative effect on profitability. The result of
simultaneous regression show that three types of financing have effect on profitability.
1 INTRODUCTION
Market share and increasing Islamic banking assets
have not showed a better performance than
conventional banking, particularly the level of
profitability as measured by ROA. The Financial
Services Authority data (2017) pointed out that ROA
on public Bank Syariah (BUS) is much lower than
with a conventional public Bank (BUK). In
December 2016 level ROA on the BUS of 0.63
percent while ROA on the THUMP of 2.23 percent.
Low levels of ROA on the BUS means that
managerial BUS performance and less efficient asset
utilization (Marbelanty and Adityawarman, 2015).
Islamic banks serve as the intermediary
institutions that connect between the parties that
have excess funds and those who require funding
through financing activities. Financing is a product
of channeling funds Islamic banking which became
the Foundation of the survival efforts of Islamic
banking and can support the growth of Islamic
banking market share nationwide.
Based on Sharia Banking Statistics data
published by the financial services authority (2017),
financing is channeling funds between the highest
types of channeling funds to each other. On average
the share of remittances in the form of financing
during the year 2014 to 2016 is over one hundred
per cent of the total funds disbursed, the rest is
channeled through placement in Bank Indonesia,
placement in other banks, investment securities, and
inclusion.
Islamic banking is generally provides funding in
three contract, such contract and selling (murabaha,
greetings, and istishna), sharing (mudharabah and
musyarakah) and rent (ijarah). Among the three
types of financing, financing and selling is a product
of the most sought after by most customer financing,
especially the use of contract murabahah.
Based on statistical data of Sharia Banking the
financial services authority (2017), through the year
2016 total funds from these three types of financing
are disbursed is Rp. 173,599 billion. Financing and
selling got 63 percent of the total parts financing
channelled BUS, followed by the financing for the
results amounted to 36 percent of the total financing,
and amounted to one percent of the total financing is
a financing lease.
The reason the large number of product use and
selling financing is marked up and sure enough
transactions and ease compared to the profit and loss
sharing, so that the bank is able to obtain
comparable to banking conventional interest-based
(Rahman and Rochmanika, 2012). In addition, the
financing for the results is financing the second
transmitted after financing and selling. The cause is
the financing for the results have the biggest risk
levels whereas financing in the form for these results
is the main operational principles of Islamic banking
and impacting directly to economic growth (Hadi,
2011).
782
Pratami, Y., Kusnendi, K. and Heraeni, H.
The Influence of Financing Against Profitability at Bank Syariah in Indonesia in General 2010-2016.
In Proceedings of the 1st International Conference on Islamic Economics, Business, and Philanthropy (ICIEBP 2017) - Transforming Islamic Economy and Societies, pages 782-786
ISBN: 978-989-758-315-5
Copyright © 2018 by SCITEPRESS – Science and Technology Publications, Lda. All rights reserved

According to Muhammad (2002) is a non-profit
or profit in Islamic banking can be obtained from the
margin of the selling price of the financing of the
sale, the share of business results of the financing for
the results, the results of the ijarah contract rent, as
well as fee and the administrative fee upon services
others. This is supported by the research of Izhar and
Asutay (2007) which revealed that the portion of the
income of the bank from channeling financing
generally positive effect against the probitabilitas
Islamic banks.
2 METHODOLOGY
Approach this research using a quantitative approach
(Tanjung and Dewi, 2013). Based on the methods
used in this research is quantitative research of
causality (Muhammad, 2008). Based on the goal of
this research including research into verifikatif
(Arikunto, 2006). The object in this study is the
amount of funds channelled financing of financing
and selling, for results, and rent, as well as the
profitability measured by ROA. This research will
be conducted on annual financial reports published
by the seven companies public Bank Syariah (BUS)
in Indonesia. Research related to financing and
selling was done by Abusharbeh (2014) in his
journal holds that the relationship of distribution
financing and selling a positive effect towards
profitability
Data analysis techniques used in this research is
the analysis of the influence of the test through the
panel data regression testing (regression pooling).
According to Rosadi (2012) data panel is "Data that
presents a number of variables over some categories
and collected in a specific time period for the
observed". In panel data regression analysis there are
three approaches to parameter estimation techniques
of regression model data between other panels
common effect, fixed effects, and random effect.
3 RESULTS
Table 1: The Result of Test Chow.
Effects Test Statistic d.f. Prob.
Cross-section F 0.944164 (6,39) 0.4750
Source: Research Result (2017).
Based on table 1, the test results with the Test
value indicated that Chow Prob Cross-section F of
0.4750 or more than 0.05. Thus, this research can
perform regression analysis by using the common
model of the effect and the Test Hausman is not
necessary
Table 2: Panel Data Regression Results.
Variable Coefficient Std. Error t-Statistic Prob.
C -1.017704 0.900791 -1.129788 0.2646
X1 0.317748 0.105130 3.022443 0.0041
X2 -0.327017 0.104125 -3.140625 0.0030
X3 0.146372 0.049888 2.934007 0.0053
Source: Research Result (2017).
Based on the results of the regression test output
in table 2 regression equations were obtained with
the model of common effect, namely:
Y = -1,017704 + 0,317748X
1
– 0,327017X
2
+
0,146372X
3
 Y = -1,017704, This means that if none of
these three types of financing are provided
then the level of profitability of the BUS
which was projected with the ROA will
decrease amounting to 1.017704 percent;
 β
1
= 0,317748, This means that any increase in
rupiah financing and selling one provided,
level of profitability also increased by
0.317748 percent;
 β
2
= -0,327017, This means that every rise of
one rupiah financing for the results provided
will lower the profitability rate of 0.327017
percent;
 β
3
= 0,146372, This means that every rise of
one lease financing given the rupiah will raise
the level of profitability of 0.146372 percent.
Table 3: The t-test Result.
Variable Value t Table t
Prob. T
Value
Financing
Selling (X1)
3,022443 1,67943 0,0041
Financing for
Result (X2)
-3,14062 1,67943 0,0030
Financing Lease
(X3)
2,934007 1,67943 0,0053
Source: Research Result (2017).
Based on table 3, the value t calculate on the
third independent variable is greater than the value
of t and t probability values tabulated in the third
independent variable is below the value significance
of 0.05. So the third type of influential and
significant funding towards profitability. Variable
selling and financing financing lease has influence
with the direction of the relationship is positive
while the financing for the results variable has
The Influence of Financing Against Profitability at Bank Syariah in Indonesia in General 2010-2016
783

influence with the direction of the relationship is
negative.
Table 4: The F-Test Result.
F-statistic 7.576816
Prob(F-statistic) 0.000332
Source: Research Result (2017).
In table 4, the value of F tables obtained from the
values of the numerator and denominator df df. With
the provisions of the value k = 4 and the value of df
is the denominator (N2) is 45 where N2 = n – k = 49
– 4 = 45 and the value of df is the numerator (N1)
was where N1 = k-1 = 4-1 = 3. The value F table
with 0.05 significance is 2.81. Based on the results
of a regression test in table 5 were obtained F value
count of 7.576816. Thus the value of F F table value
> count and value probability 0.05 significance level
< F. This test result is obtained that third F
independent variable affect the dependent variables
simultaneously (profitability).
Table 5: The R
2
Result.
R-s
q
uare
d
0.335602
Ad
j
usted R-s
q
uare
d
0.291308
Source: Research Result (2017).
Based on the regression results shown in Table 5
retrieved value R2 of 0.335602 and the adjusted R2
value (Adjusted R-squared) of 0.291308. This means
that 33.5602 percent of profitability can be
explained by a third independent variable (financing
and selling, financing for results, and lease
financing). As for the 66.4398 percent of affected by
other factors that are not included in the regression
model.
Results of testing the hypothesis concerning the
influence of financing and selling against the
profitability of selling financing showed that
positive effect significantly to profitability. It means
an increase in funds for financing of the sale
provided a BUS every year potentially will increase
the profitability of the BUS as measured by ROA.
Thus the hypothesis which States that the existence
of a positive influence between financing and selling
with acceptable profitability.
Otoritas Jasa Keuangan (2017) in Shariah Banking
Statistics 2016 States that selling financing provided
by BUS is the largest financing portion in between
other types of financing, that amounted to 63 percent
of the total financing. According to Karim (2011),
when compared with Akkadian istishna customer
greeting, and prefer to apply for financing from the
side of murabaha financing object acceptance,
especially for financing consumer clients.
Selling financing in accordance with the theory
of Exchange or natural certainty contracts (NCC)
where the financing deals and selling give certainty
of payment, both in terms of quantities or time, so
that the flow of funds for sure or already agreed at
the beginning of the object of exchange of contracts
and also certainly in quantity, quality, time, and
price (Rivai and Veithzal, 2008). Flow of funds
financing repayment the definite buy sell and fit the
target can support towards income generation BUS
itself so that it can increase the ROA.
The research is in line with research Haq (2015)
and Abusharbeh (2014) stating that the financing
and selling a significant and positive effect toward
profitability. Similarly, research conducted with
Rahman and Rochmanika (2012) that the financing
of the sale of influential positive towards
profitability. Selling financing potential greater than
other financing was able to give positive influence
against ROA because the level marked up from
selling financing can provide the greatest revenue
for Islamic banks.
Results of testing the hypothesis concerning the
influence of finance for results against profitability
indicates that financing for the negative effect the
results significantly to profitability. This research
was originally alleged that financing for the results
have a positive affect toward profitability, but after
doing a panel data regression test research
hypotheses stated that financing for the results of a
positive effect against the profitability of denied.
The results of this study indicate that if financing for
results increases then it will lower the profitability
on the BUS.
According to Karim (2011), financing for results
is a form of investment contracts that are included in
the theory of mixture or natural uncertainty contracts
(NUC). In the NUC parties Transact mutually
mixing assets into one, and then run the risk of being
together for profit. This investment contracts do not
provide certainty of income (return), both in terms of
quantities or time. Income and the timing of cash
flows obtained depends on the performance of the
sector riilnya.
The level of profits that accrue to the bank
always did not remain high due to the low profits
from financing for results obtained depends on the
success of bank business borrowers. Part of the
profits be shared revenue is directly proportional to
the customer. That means if the rate of profit a great
effort both parties got a big part anyway and if the
level of small business advantage then gained the
advantage small part anyway. The repayment of any
loan principal in accordance with the customer's
ICIEBP 2017 - 1st International Conference on Islamic Economics, Business and Philanthropy
784

business cash flow. Division of business results have
difficulties to apply because the calculation of the
profit sharing is complicated and would have to
follow what's happening in actual business. In
addition the cost of funds obtained on the basis of
the system for results not known clearly and
definitely (Veithzal and Rivai, 2008).
Karim (2011) suggested that in the event of
losses in finance for the results the bank took losses
of profits in advance because the advantage is patron
capital, whereas if the losses exceed the amount of
the advantage then the bank can pick it up from the
principal capital.
Research conducted by Riyadi and Yulianto
(2014) also revealed that the financing for the results
negative effect against the profitability of foreign
exchange on the BUS. This is so because of the high
risk of moral hazard posed by customer financing.
Results of testing the hypothesis concerning the
influence of lease financing toward profitability
indicates that the positive effect of lease financing
significantly to profitability. It means an increase in
funds for financing of the sale provided a BUS every
year potentially will increase the profitability of the
BUS as measured by ROA. Thus the hypothesis
which States that the existence of a positive
influence between financing and selling with
acceptable profitability.
Finance leases are included in the category of
natural certainty contracts (NCC) or Exchange
theory. Technically, any lease financing have in
common with the financing. The difference is in
financing the transaction object is used. On the
financing lease financing is object services then the
bank can also serve clients who only need the
services, i.e. the benefit upon the object of financing
given Sharia bank (Karim, 2011).
Object of financing lease transferable ownership
at the end of the rental period or known as ijarah
muntahiya bi tamlik (IMBT). According to Antonio
(2001), Islamic banking more use IMBT in
financing the lease because of a simple bookkeeping
and maintenance of asset financing that is not too
complicated. To get the maximum income is usually
the bank selling the object of financing to customers
after the ending of contract rent compared to grant
the lease assets. In addition to obtaining rental
income, the bank also gets revenue from the margin
of the selling price of the asset sale transaction
financing leases. Therefore technical contract IMBT
do not differ greatly with technical selling financing,
particularly Akkadian murabaha.
The results of this research are consistent with
research conducted by Ogilo (2016) and Pratama et
al. (2017), Both these studies reveal that financing
leases given a positive effect against Islamic bank
profitability. The potential rental income obtained by
the bank especially in the revenue generated from
the Akkadian IMBT contribute to increased
profitability of Islamic banks.
But there are also studies that show different
results as research done Haq (2015); Haron and Wan
(2004) that the financing for the influential results
negatively to profitability. So did research with
Haron and Wan (2004) that the financing and selling
does not have significant influence towards Islamic
banking profitability.
The results of testing hypotheses about the
influence of these three types of financing against
profitability indicates that financing has an impact
on the profitability of the BUS. It means financing
provided to contribute to the improvement of
profitability on a BUS in Indonesia.
Rivai and Veithzal (2008) and Muhammad
(2005) suggests that profitability (profitability) is
one of the objectives of the financing reached
syariah bank acquires the maximum profit. This goal
is achieved by increasing the ability of the BUS
companies in the management of the Fund's
financing. The profit margin earned from selling
price, the portion for the results, and the rental fee is
the dominant source of income so that they can have
an effect on the development of profitability on a
BUS.
The results of this research are consistent with
research conducted by Izhar and Asutay (2007) that
the revenue obtained from the Islamic bank
financing channelling effect on profitability as
measured by ROA. So did research with Ogilo
(2016) who suggested that the financing of
mudharabah musyarakah, financing, financing of
murabaha, ijarah financing and simultaneous effect
on profitability.
4 CONCLUSIONS
There is a trend of increased financing and selling
will result in increased levels of profitability so that
financing and selling a positive effect towards
profitability. Selling financing gives the certainty of
payment, both in terms of quantities or time, as well
as the use of sales margin was able to contribute to
the improvement of the profitability of the BUS.
There is a trend of increased financing for results
will result in a decrease in the level of profitability
so that financing for the influential results negatively
The Influence of Financing Against Profitability at Bank Syariah in Indonesia in General 2010-2016
785

to profitability. Financing system for results that are
still fairly complicated and risky hasn't been able to
contribute to the improvement of the profitability of
the BUS.
There is a tendency of an increase in lease
financing will result in increased levels of
profitability so that the positive effect of lease
financing toward profitability. The BUS can increase
profitability through financing lease contract IMBT
with techniques, mainly by selling assets leases to
customers.
There is a tendency that the financing of the sale,
the financing for the results, and lease financing can
support the development of profitability so that these
three types of financing on the BUS simultaneously
has an impact on profitability.
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