Identification of Factors That Contribute To Capital Structure.

Identification of Factors That Contribute To Capital Structure.

Author		: NORITA
Published on	: ICoICT 2014 (Telkom University - Bandung Indonesia)

Abstract

This study was conducted to identify the factors that contribute to the capital structure. Furthermore, also to determine the contribution of each of these factors either simultaneously or partially. By knowing what are the factors that contribute most significantly, the management can focus on these factors to construct the capital structure in the future. The samples in this study were eleven foreign exchange banks in Indonesia, where the type of research used descriptive and verificative forms causality, the sampling method used purposive sampling and the research method used panel data. The factors that will contribute to the capital structure are profitability, growth, asset structure, bank size, liquidity, long term debt to equity, business risk. Simultaneously, these factors contributed significantly by 55.33% to the capital structure. Partially, factors that have a contributed significantly to the capital structure at eleven foreign exchange banks in Indonesia are liquidity, long-term debt to equity, and business risk.

Keywords: Capital Structure, Bank.