Systemic Risk: The Impact of COVID-19 on The Dual Banking System in Indonesia
Macroeconomic Risk and Growth in the Southeast Asian Countries: Insight from Indonesia
ISBN: 978-1-83797-043-8, eISBN: 978-1-83797-042-1
Publication date: 9 November 2023
Abstract
This study investigates how this pandemic impacted the systemic risk in Indonesia’s Islamic commercial banks (ICBs) and conventional commercial banks (CCBs). The authors use quantitative methods, and systemic risk is measured using value at risk (VaR) and Conditional Value at Risk (CoVaR). This study provides empirical evidence regarding the estimation and determination of systemic risk. By using spillover measures, the authors find a significant increase in systemic risk among the sample banks. The novelty in this research is the measurement of the level of banking risk in the dual banking system in Indonesia. This study makes profound contributions to the literature and suggests various policy recommendations, including identifying essential institutions and testing the benefits of policy responses in containing systemic risk. These findings need to be considered by the government and financial authorities in making accurate regulations and policies.
Keywords
Citation
Nugroho, M.R. and Kurnia, A.S. (2023), "Systemic Risk: The Impact of COVID-19 on The Dual Banking System in Indonesia", Barnett, W.A. and Sergi, B.S. (Ed.) Macroeconomic Risk and Growth in the Southeast Asian Countries: Insight from Indonesia (International Symposia in Economic Theory and Econometrics, Vol. 33A), Emerald Publishing Limited, Leeds, pp. 83-92. https://doi.org/10.1108/S1571-03862023000033A006
Publisher
:Emerald Publishing Limited
Copyright © 2024 Muh Rudi Nugroho and Akhmad Syakir Kurnia