THE EFFECT OF CASH HOLDING AND LEVERAGE ON FINANCIAL PERFORMANCE WITH GOOD CORPORATE GOVERNANCE AS A MODERATOR: A STUDY OF BPR IN CENTRAL JAVA PROVINCE FOR THE 2021-2024 PERIOD
Keywords:
Cash Holding, Leverage, Good Corporate Governance, Financial Performance, Rural BanksAbstract
This study examines the effect of cash holding and leverage on financial performance, with Good Corporate Governance (GCG) as a moderating variable in Rural Banks (BPR) in Central Java during the 2021–2024 period. A quantitative approach was applied using panel data regression and Moderated Regression Analysis (MRA) with the Random Effect Model. The sample consists of 64 BPRs with 256 observations, selected through purposive sampling, using secondary data from financial and GCG reports. The results show that cash holding and leverage have a negative and significant effect on financial performance. GCG weakens the relationship between cash holding and financial performance but does not moderate the relationship between leverage and financial performance. These findings highlight the importance of efficient liquidity and debt management, as well as the role of governance in improving bank performance.
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