The Effect of TPF, NPF and Fee Based Income on the Profitability of Islamic Banks with Financing as an Intervening Variable

The role of banking in advancing the economy of a country is very large. Almost all sectors that are associated with various financial activities always require bank services. Therefore, at present and in the future, we cannot be separated from the banking world if we want to carry out financial activities, both individuals and institutions, whether social or corporate. Sharia banking is one of the financial institutions that has the function of balancing, coordinating and coordinating various sectors of the economy. The strategic role in the development is to improve the quality of livelihoods of citizens as a whole through national stability and economic growth. Meanwhile, the bank is "Department of store, which is a body or organization that provides services / services for various financial services where the vital activities are receiving payments, savings, current deposits and deposits, which is used to be able to make credit / money loans aimed at every community needs, and banks are places used in exchanging money. (Ichsan et al, 2021) The development of Islamic banking in Indonesia has increased quite rapidly from year to year. Islamic banking business activities are carried out in accordance with Islamic teachings, in contrast to conventional banks which impose a usury system. Meanwhile, the challenges of Islamic banking in the economy in Indonesia are still quite large. For this reason, in achieving high competitiveness, Islamic banking needs to pay attention to Abstract


I. Introduction
The role of banking in advancing the economy of a country is very large. Almost all sectors that are associated with various financial activities always require bank services. Therefore, at present and in the future, we cannot be separated from the banking world if we want to carry out financial activities, both individuals and institutions, whether social or corporate.
Sharia banking is one of the financial institutions that has the function of balancing, coordinating and coordinating various sectors of the economy. The strategic role in the development is to improve the quality of livelihoods of citizens as a whole through national stability and economic growth. Meanwhile, the bank is "Department of store, which is a body or organization that provides services / services for various financial services where the vital activities are receiving payments, savings, current deposits and deposits, which is used to be able to make credit / money loans aimed at every community needs, and banks are places used in exchanging money. (Ichsan et al, 2021) The development of Islamic banking in Indonesia has increased quite rapidly from year to year. Islamic banking business activities are carried out in accordance with Islamic teachings, in contrast to conventional banks which impose a usury system. Meanwhile, the challenges of Islamic banking in the economy in Indonesia are still quite large. For this reason, in achieving high competitiveness, Islamic banking needs to pay attention to increasing the ability of these banks to become healthy banks, among others by maintaining the level of profitability, namely the level of profit generated by the bank.
Behind the rapid development of Islamic banks there is a phenomenon of neglecting its operational principles, namely profit sharing. This is indicated by the lack of resultsbased product implementation, namely mudharabah. It is precisely murabahah products that dominate the operations of Islamic banks. (Rahmati, et al 2018). According to Cashmere the profitability ratio is ratio to assess the company's ability to seek profit. ROA (Return On Assets) is a financial ratio that is used to measure the ability of bank management to earn Islamic bank profits. So that in this study, ROA is used as a measure of banking performance.
In carrying out its business activities, Islamic banks have several main functions including channeling funds (financing). The distribution of Islamic bank funds is hereinafter referred to as financing. Financing is a major factor that can affect the level of bank profitability. The activities of Islamic banks in channeling funds to them cannot be separated from the problems. Therefore, Islamic bank financing practices need to be properly managed and supervised.
Non Performing Financing (NPF) is the ratio between financing problems with total financing disbursed by Islamic banks.As research conducted by Dewa Agung Nanditya Putra, where the NPF ratio is the most important to determine the survival of a bank. NPF reflects the risk of financing, the smaller the NPF, the smaller the risk of financing borne by the bank. The source of funds is the most important thing for banks in increasing the amount of financing provided to the public. The more funds the bank has, the greater the chance for the bank to make a profit. According to Kasmir, sources of bank funds include funds originating from the bank itself, the public and from other institutions.
Another function of a bank is to provide services to parties who need it, customers or non-customers.In services, Islamic banks receive income in the form of fee-based income. According to Graddy and Spencer, the higher the fee based income, the higher the ROA. As stated by Moslem in his research, fee based income has a strong and unidirectional relationship with ROA (Return On Assets). Profitability is a measure of the ability of a business entity to generate profits. In addition, profitability can also be used to determine whether the performance of a business entity is good or bad in running its business. Therefore, this needs to be considered because in order to maintain business continuity and public trust, of course, banks need to maintain stable profitability. Public trust is very important and is the main key for the survival of a bank, because the public's assessment of a bank depends on the bank's financial performance. This study aims to provide empirical evidence regarding the effect of TPF, NPF and Fee Based Income on profitability with financing being an intervening variable in Islamic Banks in Indonesia.

Profitability
Profitability is the ability of a company to produce profit during a certain period at the level of sales, assets and capital stockcertain. The profitability of a company can be assessed in various ways depending on the profit and assets orcapital which will be compared with one another. According to Sutrisno, profitability is the company's ability to generate profits with all the working capital in it. Meanwhile, according to Brigham and Houston "Profitability is the final result of a number of policies and decisions made by the company".
To measure the level of profit of a company, the profitability ratio is used. According to Kasmir, the profitability ratio is a ratio to assess the company's ability to seek profit. The profitability ratio has benefits not only for the management or business owners but also for those outside the company, especially those who are related to the company. ROA (Return On Assets) is a financial ratio that is used to measure the ability of bank management to earn Islamic bank profits. So that in this study, ROA is used as a measure of banking performance.

Financing
In a narrow sense, financing is used to define funding made by financing institutions, such as Islamic banks, to customers. Financing or financing is funding provided by one party to another party to support planned investments, either alone or by an institution. According to Law No. 21 of 2008 article 1 on financing. Financing is a provider of funds or an equivalent claim in the form of; Profit sharing transactions in the form of muḍarabah and musyarakah, leasing transactions in the form of ijarah or leasing transactions in the form of ijarah vomit bittamlik, buying and selling transactions in the form of murabaḥah, salam and istiṣna receivables, lending and borrowing transactions in the form of qarḍ, leasing transactions in the form of ijarah for multi-service transactions.

Third Party Fund (DPK)
According to the 2013 PAPSI, Third Party Funds are customer deposits in the form of savings, current accounts and time deposits collected by syari'ah banks at certain times. DPK is an indicator in Islamic banking to see the ability of a bank to collect funds from the public. Public funds stored in banks are the largest source of funds that banks rely on, consisting of 3 types, namely: in the form of demand deposits, time deposits, and savings accounts.

a. Non Performing Financing (NPF)
NPF or non-performing financing is financing channeled by banks but customers cannot make payments or make installments that are not in accordance with the agreement agreed by the bank and the customer. In order to avoid NPF, a bank needs to carefully consider a potential customer in analyzing or assessing a financing request submitted by a prospective customer so that the bank has confidence that the business financed by bank financing is feasible to run. To determine whether or not the financing provided to customers is feasible, a bank needs to carry out an analysis of the 5C (character, capital, capacity, collateral and condition of economy) and 7P (personality, party, payment, prospect, purpose, profitability and protection).

b. Fee Based Income
According to Kasmir, fee-based income is the profit obtained from transactions provided in other bank services. Meanwhile, the term fee based income according to Islamic banking includes ujrah (wages). Ujrah is related to the benefits of banking services that can be used by the public (customers) to facilitate and streamline the economic activities of the service community such as transfers, collections, clearing, bank guarantees, letters of credit, salary payments, telephone payments and other services. Services provided by Islamic banks in accordance with the type of contract include the wakalah, kafalah, hawalah, rahn, qard, and sharf contracts.

c. TPF on Profitability
Research conducted by Evi Maulida Yanti and Dila Angraini show that TPF has a positive effect on profitability. The increase in credit capacity causes the interest income to increase so that the profit earned by the bank also increases. Based on the theoretical study and the results of previous research, the following hypothesis is formulated: Ho: TPF has a positive effect on profitability in Islamic banks.

d. NPF on Profitability
According to Evi Maulida Yanti NPF affects profitability. Therefore, if the portion of problem financing is enlarged, it can affect the possibility of a decrease in the income obtained by the bank, then this will be able to affect the amount of profit obtained by Islamic banks. And in the end, it will affect the amount of profitability that is reflected in the Return On Assets (ROA) obtained by Islamic banks. Empirical evidence of Satriyo Wibowo and Muhammad Syaichu shows that the higher the NPF ratio, the lower the profitability of Islamic banks. Based on the theory and results of previous research, the following hypothesis is formulated: Ho: NPF has a negative effect on the profitability of Islamic banks.

e. Fee Based Income against Profitability
As Yuniarti Anissya in her research stated that fee-based income has an effect on profitability (ROA) in banking companies listed on the Indonesia Stock Exchange for the period 2010-2014. The greater the fee based income, the higher the financial performance of the banking company. This provides evidence that companies that have high debt will tend to choose accounting methods that increase company profits. Based on the theoretical study and the results of previous research, the following hypothesis is formulated: Ho: Fee Based Income has a positive effect on profitability in Islamic banks.

DPK against Financing
According to the theory expressed by Sinungan, the more TPF market share is, the more loans are granted. The increase in credit capacity causes the interest income to increase so that the profit earned by the bank also increases. Evi Maulida's Research, Faudziyah Adzimatur, and Widya Karunia Adzka show that TPF has a positive effect on financing. Likewise in research and Nurimansyah Setivia Bakti, TPF coefficient value is positive. Syukriah Research also stated that TPF has a positive and significant effect on the distribution of financing to BPRS in Indonesia. Based on the theoretical study and the results of previous research, the following hypothesis is formulated: Ho: TPF has a positive effect on financing in Islamic banks.

NPF on Financing
Jiri Podpiera and Laurent concluded that the emergence of problematic financing or NPF is influenced by the ability and attitude of internal management in making financing decisions and monitoring activities as well as maintaining the quality of the financing that has been given until it is paid off or completed. Research conducted by Faudziah Adzimati, Widya Karunia Adzkia and Queen Vien Sylvia Aziza states that there is no influence between NPF on financing. However, in Nurimansyah Setivia's research shows that the more the NPF increases, the lower the financing. Meanwhile, Dewa Agung Nanditya Putra stated that the larger the loan provided by the bank, the greater the risk of financing that the bank will face. Based on the theoretical study and the results of previous research, the following hypothesis is formulated: Ho: NPF has a negative effect on financing in Islamic banks.

Profitability Financing
Research by Friska Larrasati Putri shows that muḍarabah financing has no effect on the profitability of Islamic banks. However, this is different from the research conducted by Ulin Nuha and Hanania which states that financing has a significant and positive effect on the level of profitability of Islamic banking in Indonesia both in the short and long term. Meanwhile, Dila Anggraini states that there is a negative influence between financing on profitability. Based on the theoretical study and the results of previous research, the following hypothesis is formulated: Ho: Financing has a positive effect on profitability in Islamic banks.

TPF on Profitability with Financing Interventions
Nuha's Ulin Research and Dila Anggraini stated that indirectly TPF through financing had an insignificant effect on profitability. This shows that financing cannot mediate the effect of the TPF variable on profitability. Based on the theoretical study and the results of previous research, the following hypothesis is formulated: Ho: TPF has a positive effect on the profitability of Islamic banks with financing as an intervening variable.

NPF on Profitability with Financing Interventions
The provision of credit / financing carried out by banks can create risks, namely in the form of non-smooth credit payments or in other words called credit risk. The measuring instrument used to measure credit risk in this study is Non-Performing Financing (NPF). If a bank has a high NPF, it will increase costs, both the cost of reserves for productive assets and other costs, in other words, the higher the NPF of a bank, then it will interfere with the bank's performance. Dendawijaya said the impact of the existence of an unfair NPF, one of which is the loss of the opportunity to get income from loans, thus reducing profitability and adversely affecting bank profitability. Based on the above research results, the following hypothesis is formulated: Ho: NPF has a negative effect on the profitability of Islamic banks with financing as an intervening variable.

III. Research Methods
The research approach used in this research is a quantitative approach. While the type of research used is associative research, namely research that aims to determine a relationship between two or more variables. The data source used in this study is secondary data obtained from the quarterly financial reports of Islamic Banks from 2010 to October 2019 published by the Financial Services Authority. Meanwhile, according to the time of collection, the data from this study included time series data, namely data on Islamic Bank financial reports published quarterly.
The data collection techniques in this study used document studies, namely by searching and collecting data about things or variables in the form of notes, transcripts, books, journals, etc. The data obtained in this study include data on the variables studied, namely the independent variable DPK (X1), NPF (X2), and Fee Based Income (X3) and the dependent variable is Profitability (Z) and the intervening variable is Financing (Y). in Sharia Banks in 2010-October 2019.

Variable Description a. Profitability (ROA)
The following is the ROA data for Islamic Banks published in Islamic banking statistics for the year 2010-2019. From table 1, it can be seen that the data on the development of profitability as measured by ROA in Islamic banks in Indonesia from 2010 to 2019. From this data, it can be seen that the profitability (ROA) of Islamic banks continues to increase from year to year. However, it experienced a decline in 2013, from 2.14% to 2.00%. In fact, a very significant decrease occurred in 2014 from 2.00% to 0.80%.

b. Financing
The following is a table containing data from the research variables, namely the financing variables sought from the amount of murabahah, salam, istishna, qard, financing and ijarah receivables.

c. DPK (Third Party Fund)
The following is a table that contains data from research variables, namely the variable of third party Islamic bank funds. DPK also continues to increase every year. This shows that the deposit funds provided by customers to Islamic banks are increasing every year. The data is obtained from data on funds from BUS and UUS customers, which consist of: (1) Wadiah Savings Fund, namely current accounts and savings, (2) Non-Profit Sharing Investment Funds, namely current accounts, savings and time deposits, and (3) Profit Sharing Investment Funds. , namely current accounts, savings and time deposits for the period 2010-2019. The highest increase occurred in 2011 amounting to 51.80%. While the lowest increase was in 2015 amounting to 6.11%.

d. NPF (Non Performing Financing)
The NPF data for Islamic Banks from 2010-2019 are as follows: From the table 4, it can be seen that the NPF in Islamic Banks has fluctuated. In 2011 and 2012 the NPF decreased from 3.02% to 2.52% then fell back to 2.22%. However, in the following year it actually increased until 2016. In 2017 and 2018 it began to decline again, but in the following year, namely 2019, the NPF increased from 2.85% to 3.26%.

e. Fee Based Income
The following is the Sharia Bank fee-based income data from 2010-2019. From table 5, it can be seen that the value of Fee Based Income in Islamic Banks fluctuates. Viewed from 2010 to 2016, it continues to increase. However, the increase in 2016 was very significant compared to previous years. Whereas in the following year it actually experienced a very significant decline then it rose again in 2018, and in 2019 it began to decline again.

Statistical Test Results a. Classic assumption test
The test aims to determine whether the data that has been used meet the classical assumptions consisting of symptoms of normality, multicollinearity, autocoleration, heteroscedasticity. These tests can be described as follows:

b. Data Normality Test
The following are the results of the normality test:

Figure 1. Histogram Model I Normality Test Results.
Based on the histogram image above, it can be seen that the curve has a balanced slope from the right and the left, the lines also resemble a bell. This means that the figure shows that the data is normally distributed based on the model I normality test with financing as the dependent variable. Meanwhile, for the model II normality test with profitability as the dependent variable we can see it from the following figure.

Figure 2. Histogram Model II Normality Test Results
Based on Figure 2 above, it can be seen that all variables are normally distributed, this is because the histogram curve has a slope that tends to be balanced from the right to the left, and forms a bell or parabolic pattern.

c. Multicollinearity Test
The following are the results of the multicollinearity test:  table 6 and table 7, it can be seen that the VIF value of all variables is smaller than 10, so it can be said that between the independent variables there is no multicollinearity problem.

d. Heteroscedasticity Test
The following are the results of the heteroscedacity test:

Figure 4. Heteroscedasticity Test Results Model II
From the two images above, namely Figures 3 and 4, it shows that the distribution of residual data does not form a certain pattern and spreads below and above the zero on the Y axis. Thus between model I and model II are free from heteroscedasticity symptoms.

e. Autocorrelation Test
The following are the results of the autocorrelation test:

Effect of TPF on Profitability
The results of hypothesis testing in this study were rejected because it showed that TPF had a negative and insignificant effect on the dependent variable, namely Profitability (ROA) in Islamic Banks. Meanwhile, in the research conducted by Dila Anggraini stated that TPF is a significant influence on profitability in the Islamic banking industry sector group. Likewise, research conducted by Ulin Nuha and Afrizal stated that TPF has a positive and significant effect on profitability.

The effect of NPF on Profitability
Hypothesis testing in this study is accepted because it shows that the independent variable, namely Non-performing Financing (NPF) has a negative and significant effect on profitability. So it can be concluded that there is a direct significant effect of NPF on profitability. As research conducted by Ulin Nuha, NPF has a negative and significant effect on profitability. Dila Anggraini shows the influence of NPF on profitability (ROA).

Effect of Fee Based Income (FBI) on Profitability
The results of this study indicate that fee-based income directly has a significant effect on company profitability. As Yuniarti Anissya in her research stated that fee-based income has an effect on profitability (ROA) in banking companies listed on the Indonesia Stock Exchange for the period 2010-2014.

The Effect of TPF on Financing
From the results of a partial statistical test in this study, the significance value obtained indicates that there is a direct influence between the independent variable on the dependent variable. This means that TPF has a significant effect on financing. This also shows that the increase in TPF at a bank, the more financing provided to the public. This research is in line with research conducted by Evi Maulida, Faudziyah Adzimatur, and Widya Karunia Adzka which showed that TPF has a positive effect on financing.

The Effect of NPF on Financing
From the results of the analysis of this study, it is obtained a significance value and a negative coefficient value which can be concluded that directly there is no significant effect between the X2 variable on Y. This indicates that NPF does not have a significant effect on financing. As with the research conducted by Faudziah Adzimati, Widya Karunia Adzkia and Ratu Vien Sylvia Aziza which stated there was no influence between NPF on financing. However, in Nurimansyah Setivia's research, it shows that the higher the NPF, the lower the financing. The increase in NPF was due to the increase in problematic financing so that Islamic banking was careful to issue the financing it issued to minimize the incidence of problem financing.

Influence of Financing on Profitability
In this study, it can be seen from the research results obtained that the significance value of the funding variable is greater than 0.05. So it can be concluded that directly there is no significant effect between financing on profitability. As Friska Larrasati Putri's research shows that muḍarabah financing has no effect on the profitability of Islamic banks. However, this is different from the research conducted by Ulin Nuha and Hanania which states that financing has a significant and positive effect on the level of profitability.

Effect of TPF on Profitability through Financing
Based on the results of this study, it is known that the value of the indirect effect is smaller than the value of the direct effect. These results indicate that indirectly TPF through financing has no significant effect on profitability. This is in accordance with the research of Ulin Nuha and Dila Anggraini which states that financing cannot mediate the effect of the DPK variable on profitability.

The Effect of NPF on Profitability through Financing
In this study, from the results of the path analysis, it can be seen that financing can mediate the effect of the NPF variable on profitability. This can be seen from the value of standardize coefficients, the direct effect of NPF on profitability is smaller than the value of the indirect effect through financing. These results indicate that indirectly NPF through financing has a significant effect on profitability. Thus this hypothesis can be accepted.

V. Conclusion
This study aims to analyze the effect of TPF, NPF and Fee Based Income on the Profitability of Islamic Banks with Financing as an Intervening Variable. From the hypothesis made, the following conclusions can be drawn: 1. TPF directly has an insignificant effect on the dependent variable profitability. 2. The independent variable NPF directly has a negative and significant effect on profitability. 3. Fee Based Income directly has a negative and significant effect on profitability. 4. The independent variable TPF directly has a significant effect on the dependent variable on financing. 5. The independent variable NPF directly has an insignificant effect on the dependent variable on financing. 6. The direct financing variable does not have a significant effect on profitability. 7. The TPF variable indirectly does not have a significant effect on profitability through financing. And the financing variable cannot mediate the effect of the NPF variable on profitability. 8. The NPF variable indirectly has a significant effect on profitability through financing.
And the financing variable can mediate the effect of the NPF variable on profitability.