Analysis of the Impact of Operational Efficiency (BOPO) and Profitability (ROA) on Credit Distribution at Bank Muamalat Indonesia (2018-2023)

Abstract

This study examines the influence of the Operational Efficiency Ratio (BOPO) and Return on Assets (ROA) on credit distribution at Bank Muamalat Indonesia (2018-2023) using a quantitative approach with secondary data from annual financial reports. The analytical methods include descriptive analysis and linear regression with classical assumption testing.The results indicate that high BOPO levels (averaging 98.42%) negatively affect credit distribution, except in 2022 when a BOPO reduction to 96.62% led to a 4.3% increase in credit. Low ROA (0.1%) also demonstrated positive effects, where an ROA increase to 0.09% in 2022 similarly contributed to 4.3% credit growth. These findings underscore the critical importance of operational efficiency and profitability in the credit distribution performance of Islamic banking institutions.Keywords : BOPO (Operating Expense to Operating Income Ratio), ROA (Return on Assets),Financing.