Determination of Company Profitability and Value of Banks in Indonesia Based on Risk Profile, Capital Structure, Corporate Governance and Asset Structure
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This study aims to analyze and obtain empirical evidence about the effect of risk profile, capital structure, corporate governance and assets structure on profitability and the effect of profitability on corporate value. The object of the research is a banking company listed on the Indonesian stock exchange from 2011 to 2017. Data were analyzed using structure equation modeling with smart-pls software. Banks selected based on purposive sampling were 8 banks. The results proved that only the risk profile has a significant effect on profitability. While capital structure, corporate governance and assets structure did not have significant effect on profitability. The results also showed that profitability did not have a significant effect on corporate value. Therefore, profitability has not been proven to mediate the relationship between the exogenous variables studied on corporate value. In this study, the adjusted r-square of the corporate value was 52.6%. It means that the proportion of exogenous variables influencing the endogenous variables studied was 52.6%.
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