THE INFLUENCE OF FINANCIAL RATIO ANALYSIS TO PREDICT BANKING COMPANIES PROFIT
Arnan, Sendi Gusnandar
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Financial Statement aim to give the information to be used by users for decision making process. This decision making process must be predictive value, objective and relevant. To assist the decision making process can use the ratio analysis. 1n assessing performance and health of banking companies, generalIy used five assessment aspect that is Capital, Asset, Management, Earnings, and Liquidity called as CAMEL. Four from five that assessment aspect that is capital, assets, earnings, and liquidity assessed by finance ratio. Financial ratio are useful in assessing condition of company's finance banking. Assets management at banking companies instructed to productive asset management (earning assets). Quality of bank Assets, measurable by using asset ratio related to liquidity, rentability and solvability. From assets ratio we ca n knowing the information like the ability of banking company management in obtaining profit and the ability to fulfill credit in managing on asset owned. Sample Data were taken from banking companies which listed in Indonesia Stock Exchange, where issued the financial statement up to year 2006. The measure of this financial statements based on regression analysis, correlation coefficient and determination coefficient to test the influence of asset ratio by significant to banking companies profit. Based on calculating the data and analysis, obtain the result that asset ratio is very significant to predict the banking companies profit. The forecasting model that used financial ratio to predict the profit of banking com panies will give the best of prediction result. The conclusion is if the information are more and complete will give the best of prediction result.