THE EFFECT OF ROE, LDR, NPL, AND GOVERNMENT OWNERSHIP ON PRICE TO BOOK VALUE: EVIDENCE FROM INDONESIA’S STATE-OWNED BANKS USING ARDL-PMG APPROACH (2004–2024)

Autores/as

  • Defran Siska
  • Nanang Gunawan
  • Abdul Rahman Mus
  • Lukman
  • Mursalim Laekkeng

DOI:

https://doi.org/10.18623/rvd.v23.6213

Palabras clave:

ROE, LDR, NPL, Government Ownership, PBV, ARDL-PMG, Bank Himbara

Resumen

The objective of this study is to examine the impact of Return on Equity (ROE), Loan to Deposit Ratio (LDR), Non-Performing Loans (NPLs), and government ownership on Price to Book Value (PBV) of state-owned banks (Himbara) in Indonesia during the period 2004–2024. Using a quantitative approach, this study applies the Autoregressive Distributed Lag (ARDL) model with the Pooled Mean Group (PMG) estimator for both short-term and long-term dynamics. The results show that ROE has a significant positive effect on PBV, indicating that profitability remains a key determinant of company valuation. LDR exhibits a mixed effect, reflecting liquidity management considerations, while NPLs have a significant negative impact in the long run, high lighting the importance of credit risk management. Government ownership exhibits a significant moderating role, suggesting that state involvement influences market and valuation stability. The ARDL-PMG results confirm the existence of a long-run equilibrium relationship.

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Publicado

2026-04-28

Cómo citar

Siska, D., Gunawan, N., Mus, A. R., Lukman, & Laekkeng, M. (2026). THE EFFECT OF ROE, LDR, NPL, AND GOVERNMENT OWNERSHIP ON PRICE TO BOOK VALUE: EVIDENCE FROM INDONESIA’S STATE-OWNED BANKS USING ARDL-PMG APPROACH (2004–2024). Veredas Do Direito, 23(7), e6213. https://doi.org/10.18623/rvd.v23.6213

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Vol. 23 Núm. 7 (2026): Veredas do Direito, v. 23, n. 7 2026

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