Multi-Model Prediction of Financial Distress in Indonesian Banking:
A Single-Case Study of Bank Permata Using RGEC Indicators
Keywords:
financial distress, RGEC, Altman Z″-Score, Bank Z-Score, bankometer, Bank Permata, signaling theoryAbstract
This study investigates the influence of Risk Profile, Good Corporate Governance, Earnings, and Capital (RGEC) indicators on financial distress of Bank Permata during 2014–2026 using a multi-model approach comparing Altman Z″-Score and Bank Z-Score. Quarterly data from 50 observations were analyzed through multiple linear regression, mean-difference tests, and Bankometer S-Score zone classification. Results demonstrate that the influence of RGEC on financial distress is model-dependent. In the Altman Z″-Score model, GCG and capital (CA) significantly influence financial distress, while in the Bank Z-Score model, credit risk (NPL), liquidity risk (LDR), and capital (CA) emerge as key determinants. Capital consistently appears as the most dominant variable across both models. Significant improvement in financial condition is observed after the acquisition by Bangkok Bank, reflected in higher scores of both prediction models. The Bank Z-Score exhibits substantially better explanatory power compared to the Altman Z″-Score. Furthermore, zone classification reveals that the Altman Z″-Score tends to overestimate bankruptcy potential, whereas the Bankometer S-Score consistently classifies the bank as highly sound throughout. Findings confirm that banking-specific models are more appropriate for financial distress assessment, providing empirical evidence that model selection significantly influences risk interpretation and strategic decision-making in the Indonesian banking sector.References
Abdilahi, H. A., Erena, O. T., & Abebe, A. S. (2026). Financial distress and its determinants: Evidence from commercial banks in Ethiopia. Cogent Economics & Finance, 14(1). https://doi.org/10.1080/23322039.2026.2658883
Africa, L. A. (2018). Bankometer models for predicting financial distress in banking industry. Jurnal Keuangan dan Perbankan, 22(2), 269-278. http://jurnal.unmer.ac.id/index.php/jkdp
Altman, E. I., Hotchkiss, E., & Wang, W. (2019). Corporate Financial Distress, Restructuring, and Bankruptcy (4th ed.). John Wiley & Sons, Inc.
Arsana, I. N. (2025). Financial distress prediction in rural banks in Indonesia: Pressure ratio, intermediation, and efficiency. Jurnal Ilmiah Akuntansi Kesatuan (Jiakes), 13(3), 591-602. https://doi.org/10.37641/jiakes.v13i3.3491
Azizah, S., & Lismawati. (2024). The effect of financial performance on financial distress. Jurnal Ilmiah Akuntansi Kesatuan, 12(1), 167-178. https://doi.org/10.37641/jiakes.v12i1.2470
Bank Indonesia. (2013). Peraturan Bank Indonesia No. 15/15/PBI/2013 tentang Giro Wajib Minimum Bank Umum Dalam Rupiah Dan Valuta Asing. https://www.bi.go.id/id/publikasi/peraturan/Pages/pbi_151513.aspx
Boyd, J. H., & Graham, S. L. (1986). Risk, regulation, and bank holding company expansion into nonbanking. Federal Reserve Bank of Minneapolis Quarterly Review, 10(2), 2-17. https://www.minneapolisfed.org/research/quarterly-review/risk-regulation-and-bank-holding-company-expansion-into-nonbanking
Buchdadi, A. D., Nguyen, X. T., Putra, F. R., & Dalimunthe, S. (2020). The effect of credit risk and capital adequacy on financial distress in rural banks. Accounting, 6(6), 967-974. https://growingscience.com/beta/ac/4131-the-effect-of-credit-risk-and-capital-adequacy-on-fina
Cardot-Martin, R., Labondance, F., & Refait-Alexandre, C. (2021). Capital ratios and banking crises in the European Union. Working Papers 2021-05, CRESE. https://doi.org/10.1016/j.inteco.2021.09.001
Eisenhardt, K. M. (1989). Building theories from case study research. The Academy of Management Review, 14(4), 532-550. https://doi.org/10.2307/258557
Emilia, R., & Windijarto. (2023). Good Corporate Governance (GCG) and financial distress before and during the pandemic COVID-19. Jurnal Ekonomi dan Bisnis Airlangga (JEBA), 33(2), 200-213. https://doi.org/10.20473/jeba.V33122023.200-213
Flori, A., Pammolli, F., & Spelta, A. (2019). The impact of business strategy on bank stability. Journal of Financial Stability, 45, 100702. https://doi.org/10.1016/j.jbankfin.2019.06.007
Flyvbjerg, B. (2006). Five misunderstandings about case-study research. Qualitative Inquiry, 12(2), 219-245. https://doi.org/10.1177/1077800405284363
Ghozali, I., & Ratmono, D. (2017). Analisis Multivariat dan Ekonometrika: Teori, Konsep, dan Aplikasi dengan EViews 10. Badan Penerbit Universitas Diponegoro.
Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 305-360. https://doi.org/10.1016/0304-405X(76)90026-X
Kurnia, R., Nugroho, L., & Janee-Ali, A. (2024). Signaling theory vis a vis bankruptcy prediction model in Islamic bank industry in Indonesia. Journal of Islamic Accounting and Business Research. https://doi.org/10.15649/2346030X.3788
Lepetit, L., & Strobelt, S. (2013). Bank Z-Score and the determinants of bank stability. Journal of Banking & Finance, 37(12), 5010-5023. https://doi.org/10.1016/j.intfin.2013.01.004
Luqman, R., Hassan, M. U., & Khan, M. A. (2018). Audit committee characteristics and financial distress: Evidence from Pakistan. Cogent Business & Management, 5(1), 1492869. https://doi.org/10.1080/23311975.2018.1492869
Newey, W. K., & West, K. D. (1987). A simple, positive semi-definite, heteroskedasticity and autocorrelation consistent covariance matrix. Econometrica, 55(3), 703-708. https://doi.org/10.2307/1913610
Nurjanah, Y., & Darmawan, A. (2024). Financial distress analysis using Altman Z-Score, Ohlson, and Fulmer methods: Empirical study of aviation sector companies listed on the IDX in the period of 2018 to 2021. Jurnal Ilmiah Akuntansi Kesatuan, 12(6), 513-528. https://doi.org/10.37641/jiakes.v12i6.3030
Orbaningsih, D., Kholid, A. W. N., & Sujianto, A. E. (2022). Determinants of financial distress of mining sector companies: Indonesia evidence. Journal of Accounting and Investment, 23(3), 563-575. https://doi.org/10.18196/jai.v23i3.15146
Otoritas Jasa Keuangan. (2017). Peraturan Otoritas Jasa Keuangan Nomor 15/POJK.03/2017 tentang Penilaian Kualitas Aset Bank Umum. https://ojk.go.id/id/kanal/perbankan/regulasi/peraturan-ojk/Documents/Pages/POJK-tentang-Penetapan-Status-dan-Tindak-Lanjut-Pengawasan-Bank-Umum/SAL%20POJK%2015%20Exit%20Policy%20Bank%20%20%20%20%20Umum.pdf
Otoritas Jasa Keuangan. (2025). Laporan Surveillance Perbankan Indonesia LSPI TW IV 2025. https://www.ojk.go.id/id/kanal/perbankan/data-dan-statistik/laporan-profil-industri-perbankan/Documents/LSPI%20Triwulan%20IV%202025.pdf
Qur'anna, W. W., & Isbanah, Y. (2021). Pengaruh rasio CAMEL dan faktor makroekonomi terhadap kondisi financial distress pada bank BUSN non-devisa tahun 2014-2019. Jurnal Ilmu Manajemen (JIM), 9(2), 451-466. https://doi.org/10.26740/jim.v9n2.p451-466
Rabu, M., & Binder, P.-E. (2025). The single case study is a crucial bridge between research and practice. Journal of Contemporary Psychotherapy, 55, 119-126. https://doi.org/10.1007/s10879-024-09658-2
Rizki, A. S., & Gunarsih, T. (2024). Effectiveness of RGEC-based bank soundness level and inflation rate in predicting potential bankruptcy of banks: Evidence from Indonesia. International Journal of Business and Society, 25(1), 223-241. https://doi.org/10.33736/ijbs.6908.2024
Schielzeth, H. (2010). Simple means to improve the interpretability of regression coefficients. Methods in Ecology and Evolution, 1(2), 103-113. https://doi.org/10.1111/j.2041-210X.2010.00012.x
Shar, A. H., Shah, S. A., & Jamali, H. (2010). Performance Evaluation of Banking Sector in Pakistan: An Application of Bankometer. International Journal of Business and Management, 5(9), 119-127. https://www.ccsenet.org/journal/index.php/ijbm/article/view/6916
Van Ginkel, J. R. (2020). Standardized regression coefficients and newly proposed estimators for R² in multiply imputed data. Psychometrika, 85(1), 185-205. https://doi.org/10.1007/s11336-020-09696-4
World Bank. (2024). Bank regulation and supervision survey. World Bank Group. https://datacatalog.worldbank.org/search/dataset/0038492
Zahronyana, B. D., & Mahardika, D. P. K. (2018). Capital adequacy ratio, non-performing loan, net interest margin, biaya operasional dan loan to deposit ratio terhadap financial distress. Jurnal Riset Akuntansi Kontemporer, 10(2), 90-98. https://doi.org/10.23969/jrak.v10i2.1372
Downloads
Published
Issue
Section
License
Copyright (c) 2026 Stuti Anindita, Enny Haryanti, Erric Wijaya, Ossi Ferli
This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.
Authors who publish with this journal agree to the following terms:
- Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows others to share the work to acknowledge the work's authorship and initial publication in this journal.
- Authors can enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book) with an acknowledgment of its initial publication in this journal.
- Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) before and during submission. It can lead to productive exchanges and earlier and greater citation of published work.
Abstract Views: 0
| 
File Downloads: 0
