Competition boosts bank profits in Indonesia, shadow banking plays minor role.
Competition and shadow banking can impact how profitable banks are in Indonesia. A study looked at conventional banks from 2014 to 2019 to see how competition, company size, credit risk, and shadow banking affect bank profitability. The results showed that competition and company size have a positive impact on profitability, while credit risk has a negative impact. Shadow banking has a positive effect, but it is not significant. Overall, competition, company size, and credit risk play a big role in determining how profitable a bank is.