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Performance of politically connected banks during the COVID-19 pandemic in Indonesia

Yamaguchi journal of economics, business administrations & laws Volume 69 Issue 6 Page 339-352
published_at 2021-03-31
Available 2025-03-31
[fulltext] 1.63 MB
Title
Performance of politically connected banks during the COVID-19 pandemic in Indonesia
Abstract
This research aims to examine the relationship between political connections and bank performance during the COVID-19 pandemic in Indonesia, with data sample comprising banks listed on the Indonesia Stock Exchange (IDX). The study employed a panel data linear regression and found an insignificant positive influence of political connections on banks' profitability. However, the result also indicates marginally lower profitability in politically connected banks compared to non-connected peers, and the event-study methodology reveals the tendency for affiliated banks to obtain substantial negative abnormal returns during the pandemic. Therefore, there is a negative effect of COVID-19 on stock performance of politically connected banks.
Creators Budi Wahyono
Source Identifiers [PISSN] 0513-1758 [NCID] AN00243258
Creator Keywords
political connections COVID-19 banks Indonesia
Languages eng
Resource Type departmental bulletin paper
Publishers The economic society of Yamaguchi University
Date Issued 2021-03-31
File Version Version of Record
Access Rights embargoed access
Schools 経済学部