DISIPLIN PASAR DAN TINGKAT BUNGA PERBANKAN DI INDONESIA

Abstract

This research has an objective to examine market discipline in Indonesian Banking sector. This done by examine the impact of bank risk, bank ownership and size on interest rate of bank in Indonesia. The sample consists of 21 banks listed in Indonesia Stock Exchange in period of 2003-2007. Using panel data regression and GLS (Cross section Weight) technique, the result shows evidence of market discipline in Indonesian banking sector. The evidence shows that depositors penalize riskier banks by requiring higher interest rate and banks with larger asset pay lower interest rate.