Rajindra RAJINDRA, Guasmin GUASMIN, Burhanuddin BURHANUDDIN, Rasmi Nur ANGGRAENI / Journal of Asian Finance, Economics and Business Vol 8 No 5 (2021) 0109–0115 109 109 Print ISSN: 2288-4637 / Online ISSN 2288-4645 doi:10.13106/jafeb.2021.vol8.no5.0109 Costs and Operational Revenue, Loan to Deposit Ratio Against Return on Assets: A Case Study in Indonesia Rajindra RAJINDRA 1 , Guasmin GUASMIN 2 , Burhanuddin BURHANUDDIN 3 , Rasmi Nur ANGGRAENI 4 Received: January 15, 2021 Revised: March 21, 2021 Accepted: April 01, 2021 Abstract This study aims to examine the effect of Operating Costs and Income, Loan to Deposit Ratio on the Return on Asset (ROA) of Public-Private Foreign Exchange Banks listed on the Indonesia Stock Exchange (IDX) during the 2015–2018 period. This study is a quantitative study using financial reports of Public-Private Foreign Exchange Banks listed on the IDX as a data source. This study’s population is 25 Public-Private Foreign Exchange Banks listed on the IDX. This study uses purposive sampling to determine the sample to produce 21 banking companies. Data was analyzed using multiple linear regression methods and descriptive statistics. The F Test calculation results state that all the variables of free operating expenses, operating income, and the loan to deposit ratio simultaneously and significantly affect the return on assets (ROA) variable in Public-Private Foreign Exchange Banks listed on the IDX. This study’s results indicate that simultaneously Operational Costs, Operational Income, and Loan to Deposit Ratio have a significant effect on ROA. Operational Costs and Operational Income have a significant negative impact on Return on Assets. The third hypothesis shows that the Loan to Deposit Ratio has a positive and insignificant effect on Return on Assets. Keywords: Operating Costs, Income, Loan to Deposit Ratio, Return on Asset JEL Classification Code: G00, G10, G2, G29 In this way, small deposits by individual investors can be consolidated and channeled in the form of large loans to firms (Disemadi, 2019). Banks play an important role in the financial system and the economy. As a key component of the financial system, banks allocate funds from savers to borrowers in an efficient manner. They provide specialized financial services, which reduce the cost of obtaining information about both savings and borrowing opportunities. These financial services help to make the overall economy more efficient. Foreign Exchange National Private Commercial Bank is a bank that mostly comes from and is owned by private parties (Kebede & Tegegne, 2018). National foreign exchange private commercial banks have obtained a letter of appointment from Bank Indonesia so that they can carry out banking business activities in the form of foreign currency and can conduct transactions between countries. The deed of the founders shows ownership by the private sector so that the distribution of profits is also for the private sector. Therefore, profitability must always be maintained so that financial performance is good; it is required to utilize all available resources so that there are no errors in performing its implementation. The very rapid development in the 1 First Author and Corresponding Author. Lecturer, Department of Management, Faculty of Economics, Universitas Muhamammdiyah Palu, Indonesia [Postal Address: Jl. Hang Tuah No. 114, Palu City, Centarl Sulawesi, 94116, Indonesia] Email: rajindra@unismuhpalu.ac.id 2 Lecturer, Department of Management, Faculty of Economics, Universitas Muhamammdiyah Palu, Indonesia. Email: guasminguasmin@gmail.com 3 Lecturer, Department of Management, Faculty of Economics, Universitas Muhamammdiyah Palu, Indonesia. Email: bur.feunismuhpalu@gmail.com 4 Lecturer, Department of Management, Faculty of Economics, Universitas Muhamammdiyah Palu, Indonesia. Email: rasminuranggraeni@gmail.com © Copyright: The Author(s) This is an Open Access article distributed under the terms of the Creative Commons Attribution Non-Commercial License (https://creativecommons.org/licenses/by-nc/4.0/) which permits unrestricted non-commercial use, distribution, and reproduction in any medium, provided the original work is properly cited. 1. Introduction Banking has a significant role in improving the national economy (Islam & Khan, 2019). Banks play several roles as financial intermediaries. First, they repackage the deposits received from investors into loans that are provided to firms.