Company Value in Islamic Commercial Banks: The Role of Intellectual Capital, Liquidity, and Capital Structure, with Profitability as an Intervening Variable

Abstract

The goal of this research is to evaluate the performance of Indonesian Islamic Commercial Banks across dimensions like liquidity, capital structure, and intellectual capital. The study then analyzes the path of influence these factors have on firm value, using profitability as an intermediary factor. This research utilized a quantitative methodology and utilized secondary data from 2019 to 2022 to analyze 96 observations from two intentionally selected banks.  The data analysis was conducted using Structural Equation Modelling (SEM) via the Partial Least Squares (PLS) approach. Specifically, the statistical model was tested using the WarpPLS Version 07 software. The study established that profitability significantly mediates the effect of intellectual capital on firm value. However, no mediating effect was found for profitability in the relationship between firm value and liquidity or capital structure. These latter factors were instead shown to have a direct, positive influence on firm value. This finding shows how important profitability is as a strategic link between intangible and financial resources in creating value for shareholders.