Analysis of Zmijewski Model's Accuracy in Predicting Potential Financial Distress for Indonesian Islamic Banking

Fitri Khoirotul Ummah

Faculty of Economics, UIN Maulana Malik Ibrahim Malang, Indonesia.

Esy Nur Aisyah *

Faculty of Economics, UIN Maulana Malik Ibrahim Malang, Indonesia.

*Author to whom correspondence should be addressed.


Abstract

Every banking activity and product has risks. Risk is the result or consequence of an activity during the process or in future circumstances that can cause losses. Financial Distress can be characterized by a decrease in various financial ratios, a reduction in assets, a decline in sales, a decrease in profits and profitability levels, a reduction in working capital, and a continuous increase in debt. So, in this research, the author wanted to know the level of accuracy of the Altman z-score model in predicting potential financial Distress for Sharia Commercial Banks in Indonesia. The population used in this research was Sharia Commercial Banks registered with the Financial Services Authority. The sampling technique that the researchers used was purposive sampling, with a total sample of 12 Islamic commercial banks. The research results showed that only one bank experienced financial Distress, while 11 other banks experienced good economic conditions. The Zmijewski model is good because it has a high level of accuracy with a low error.

Keywords: Financial distress, Zmijewski model, Sharia commercial banks, credit risk, Indonesia


How to Cite

Ummah, F. K., & Aisyah, E. N. (2024). Analysis of Zmijewski Model’s Accuracy in Predicting Potential Financial Distress for Indonesian Islamic Banking. Asian Journal of Economics, Business and Accounting, 24(5), 34–40. https://doi.org/10.9734/ajeba/2024/v24i51290

Downloads

Download data is not yet available.

References

Rif M, Syadali U. Maulana Malik Ibrahim Malang, Al-Yasini Pasuruan S. Enrichment: Journal of Management Risk management strategy for the problem of borrowing money for Islamic commercial banks. Enrich. J. Manag. 2023;13(2).

OJK. Laporan Perkembangan Keuangan Syariah 2022; 2022.

Mujadidah W. The effect of financial ratio on financial distress in indonesia sharia commercial. 2023;09(02).

Fortrania LM, Oktaviana UK. Analisis Tingkat Kesehatan Bank Umum Syariah Dan Unit Usaha Syariah Dengan Metode Camels Dan Rgec. El Dinar. 2016;3(1): 118–126. DOI: 10.18860/ed.v3i1.3341

Hantono. Memprediksi financial distress Dengan Menggunakan Model Altman Score, Grover Score, Zmijewski Score (Studi Kasus Pada Perusahaan Perbankan). Going Concern J. Ris. Akunt. 2019;14(1):168–180. DOI: 10.32400/gc.14.1.22372.2019.

Kason C, Angkasa Y, Gozali R, Wijaya A, Hutahean TF. Analisis Perbandingan Keakuratan Memprediksi Financial Distress dengan Menggunakan Model Grover, Springate dan Altman Z-Score pada Perusahaan Pertambangan yang Terdaftar di Bursa Efek Indonesia pada Tahun 2013-2017. J. Ilm. MEA (Manajemen, Ekon. dan Akuntansi). 2020; 4(3):441–458.

Wahyuni SF, Rubiyah. Analisis Financial Distress Menggunakan Metode Altman Z-Score, Springate, Zmijeski dan Grover pada Perusahaan Sektor Perkebunan yang Terdaftar di Bursa Efek Indonesia. Manieggio J. Ilm. Magister Manaj. 2021; 4(1):62–72,.

Cahyaningrum AP, Ulum AS. Pengaruh Board Gender, Firm Performance, Operating Capacity dan Sales Growth terhadap Financial Distress. J. Account. Manag. Student. 2024;1(1):[Online]. Available:https://journals.unikal.ac.id/index.php/jams/article/view/62

Wu N, Zhang Z, Lin B. Responses of financial stress and monetary policy to global warming: Evidence from China. Int. Rev. Financ. Anal. 2024;92:103092. DOI: 10.1016/j.irfa.2024.103092

Shan YG, Troshani I, Wang J, Zhang L. Managerial ownership and financial distress: Evidence from the Chinese stock market. Int. J. Manag. Financ. 2023;20(1): 192–221. DOI: 10.1108/IJMF-06-2022-0270

Anistasya V, Setyawan IR. The effect of profitability, liquidity, and leverage on financial distress. Hita Akunt. dan Keuang. 2021;2(2):563–580. DOI: 10.47065/imj.v4i2.314

Munandar A, Triyana E. Corporate governance moderated profitability , liquidity and cash flow on financial distress. 2024;4(1).

Priyanti MWA, Riharjo IB. Analisis Metode Altman Z-Score, Springate, Dan Zmijewski Untuk Memprediksi Financial Distress. J. Ilmu dan Ris. Akunt. 2019;8(6):1–15.

Huda EN, Paramita PD, Amboningtyas D. Analisis Financial Distress dengan Menggunakan Model Altman, Springate dan Zmijewski pada Perusahaan Retail yang terdaftar di BEI Tahun 2013-2017. J. Manage. 2017;5(5):1–11.

Sembiring S, Sinaga HWC. Analisis Akurasi Model Altman, Grover, Springate, Zmijewski Dalam Memprediksi Kondisi Financial Distress (Studi Empiris Pada Perusahaan Ritel Yang Terdaftar Di Bursa Efek Indonesia. J. Ris. Akunt. Keuang. 2022;8(2):299–311. DOI: 10.54367/jrak.v8i2.1662

Ick FJ, Tarigan L. Analisa Perbandingan Model Altman Z-Score, Model Zmijewski, Model Springrate, dan Model Grover, dalam Memprediksi Kebangrutan pada Perusahaan Pertambangan di BEI (Periode 2012-2016). Fundam. Manag. J. 2018;3(1):44–53,.

Marlinda D, Yulia A. Analisis Potensi Financial Distress Dengan Metode Springate Pada Bank Umum Syariah Di Indonesia. J. Ilm. Mhs. Ekon. Akunt. 2020; 5(1):36–49. DOI: 10.24815/jimeka.v5i1.15427.

Aisyah EN. Statistik Inferensial Parametrik. Malang Univ. Negeri Malang; 2015.

Yuliana I. Prediksi Kebangkrutan Perusahaan Dari Aspek Keuangan Dengan Berbagai Metode. Malang: UIN Maliki Press; 2018.

Prasetyo A, Faturohman T. Financial distress and financial performance analysis of highway companies before and during the COVID-19 Pandemic: Evidence from Indonesia stock exchange. in Comparative Analysis of Trade and Finance in Emerging Economies. Barnett WA, Sergi BS, Eds. Emerald Publishing Limited. 2023;31:151–165.

Archer S, Karim RAA. The structure, regulation and supervision of Islamic banks. J. Bank. Regul. 2012;13(3):228–240. DOI: 10.1057/jbr.2012.3

Alam N. Impact of banking regulation on risk and efficiency in Islamic banking. J. Financ. Report. Account. 2013;11(1):29–50. DOI: 10.1108/JFRA-03-2013-0010

Abu Hussain H, Al-Ajmi J. Risk management practices of conventional and Islamic banks in Bahrain. J. Risk Financ. 2012;13(3):215–239. DOI: 10.1108/15265941211229244

Liu J, Ge Z, Wang Y. Role of environmental, social, and governance rating data in predicting financial risk and risk management. Corp. Soc. Responsib. Environ. Manag. 2024;31(1): 260–273. DOI: 10.1002/csr.2567