Presenters: Syaifuddin, Rosita Alting, Marini Nur Amalia K. Bowode, Abd. Rauf Wajo
Affiliation: IAIN Ternate
Room: 3
ICIES News- Among the notable presentations was the research by Syaifuddin and his colleagues from IAIN Ternate, entitled “Islamic Financing Risk Management Model: Regionally Owned Sharia Microbanks In Indonesia.”
In their presentation, Syaifuddin and his team addressed the development of a financing risk management model tailored for sharia microbanks. This study was prompted by the observed increase in Non Performing Finance (NPF) in sharia banks over the past decade. The researchers employed qualitative methods, conducting interviews with financing and bank management committees and analyzing financing documents from Islamic microbanks in Indonesia.
The study focused on a sample of 21 Islamic banks, predominantly owned by local governments. The findings highlighted that 21 out of the 176 regionally owned BPRS (Sharia Rural Banks) in Indonesia successfully managed their NPF levels below the regulatory threshold. The banks achieved this by implementing several mitigation strategies, including debt restructuring, debt rescheduling, non-litigation dispute resolution, and litigation.
These mitigation measures proved effective in curbing the growth of NPF and minimizing potential bank losses. The research offers valuable insights into developing robust risk management models for sharia microbanks, particularly those owned by local governments.
The presentation was well-received by conference attendees, underscoring the critical importance of effective financing risk management in maintaining the stability and sustainability of sharia banks. The research findings are expected to serve as a useful reference for other sharia banks aiming to enhance their risk management practices and overall performance.