ESTIMATING THE POTENTIAL BANKRUPTCY ON BANKING SECTOR IN INDONESIA
NASUTION, MUHAMMAD DHARMA TUAH PUTRA
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Bank as financial institutions has an essential role in a business, which functions as a financial intermediary between the individuals who have a surplus fund with the individuals who needed resources as a deficit unit. Bank in managing the operation activity do not escape from the risk of bankruptcy which can be systemic impacts on the other sectors. This study examines whether there was a difference in the potential of bankruptcy for the banking sector that has listed on Indonesia Stock Exchange using the method of Altman Z-Score, and Springate. The possibility of bankruptcy from three modelscompared with paired sample t-testand the significance level of 0.05.The study results demonstrate there is a difference between the potential of bankruptcy in the banking sector listed on Indonesia Stock Exchange using the method of Altman Z-Score and Springate. The analysis results alsoconfirmed that the method of Altman Z-Score is still beneficial in predicting bankruptcy. The evidence shown by cointegration testing was more able to prove the relationship and the perspective of the long-term period. Therefore, the authors conclude thatamong of variables determining the Altman Z-Score has the empirical data relationship.