COMPARISON OF ISLAMIC BANK PERFORMANCE AND CONVENTIONAL BANK PERFORMANCE IN PROVINCE WITH MUSLIM MAJORITY AND PROVINCE WITH NONMUSLIM MAJORITY POPULATION IN INDONESIA

This study aims to examine the universality of Islamic banking services and products and conventional banks in Indonesia to test whether all circles both Muslims and nonMuslims can accept the services and products of Islamic banks and conventional banks. The method used using MANOVA ( Multivariate Analysis of Variance ) test by comparing the performance of Islamic banks and conventional banks represented by several indicators like third party fund and financing or lending in some provinces in Indonesia. There are two categories of provinces, namely the first category is the province of the province with the majority Muslim population and the second is the provincial category of provinces with non-Muslim majority population in Indonesia.There is no significant difference in the performance of third-party funding of Conventional Commercial and Islamic Banking in Provinces with Majority of Moslems and Non-Muslim Majority Provinces. There is no significant difference in the performance of credit distribution of Conventional Commercial Banking and Islamic Comercial Banking in Provinces with Majority of Moslems and Non-Muslim Majority Provinces.


Introduction
Indonesia is a unique country. In addition to the country with predicate ten countries with the largest population in the world, the country is known for a vast area and flanked by two continents and oceans and consists of more than 17,000 islands. Demographically the population of Indonesia consists of various religions and tribes. The majority of Indonesia's population to Islam and many other religions s expertise Christian, Catholic, Hindu, Buddhist, and Koghuchu. The exciting thing about this situation is that even though nationally that Islam is the largest.The spread of Muslims not evenly spread throughout Indonesia there are some areas where the majority of the population is not Muslim. As well as the island of Bali is very famous for tourist destinations in the province with the majority population Hinduism and likewise as the province of Papua at the eastern end of the country is a province with a Christian majority.
This demographic state also affects business and economic activity. Religious factors in many ways influence the behavior of producers and consumers. One of the critical economic activities is banking institutions. Banking is the heart of the economy and is an intermediary institution for fund owners and funders. In Indonesia, there are two types of banks, namely conventional banks and Islamic banks. The development of Islamic bank in Indonesia kept moving rapidly but still in the middle rather than conventional banks. According to the Indonesian Financial Services Authority as of June 2018, total assets of Islamic banking has reached 428.2 trillion rupiahs or 6.05% of total conventional banking assets which reached Rp.7078.45 trillion rupiah while public funds stored in Islamic banks reached 348, 9 trillion rupiahs or 6, 6% compared to the fund community in conventional banks who achieve 5.293 trillion rupiah. The details of total Islamic banking assets in Indonesia consist of Islamic bank asset which reached 294.4 trillion then Islamic banking unit which reached 133.93 trillion rupiah and total third-party funds from all types of Islamic banks which reached 358.91 trillion rupiahs. However, still, this figure is still far below the conventional banking industry that is 7078, 45 trillion. The potential of Islamic finance in Indonesia is considerable, supported by a large Muslim population in Indonesia and is the largest Muslim population in the world.
One of the main problems faced by Islamic banks in developing their business is the image problem of Islamic banks. Many people consider that this Islamic bank is "only for Muslims only" for outside-Muslims and for Muslims to consider that Islamic banks are the same as conventional banks. Several studies supporting the statement include the Mualim (2003) citing several studies conducted by Bank Indonesia, and the Research Institute conducted across the island of Java and samples taken in several towns and districts. This research reveals the general impression that is captured by the society against Islamic bank is (1) Islamic Bank identical with profit sharing bank (2) Islamic Bank is an Islamic Bank(Mu'allim 2003). Specifically in West Java as much as 8, 1 percent of respondents stated that Islamic banks are only for Muslims only, while in Central Java, religious factors become the primary driver of a consumer to be a consumer of Islamic banks. Riaz (2017) [1]also investigates British public perceptions of Islamic banks in the UK(Riaz, Burton, and Monk 2017). The findings show that there are some obstacles for the Islamic banks in the UK to be accepted that is the term akad terms and product names that are difficult to pronounce and difficult understand, the lack facility on internet banking and the lack of network offices that spread throughout the country... By using the questionnaire freedom as many as 229 consumers of conventional banks and 225 consumer Islamic banker. Saleh (2017) investigate the satisfaction of banks in Bangladesh. The results show that service quality gives significant effect to customer satisfaction rather than quality service image and it found in both types of banks. Islamic banks show better performance in the areas of reliability, responsiveness, security, and reputation (Saleh et al. 2017). Riaz (2017) [1]investigates the motivation of bank customers in Pakistan and has collected 150 questionnaires in the town of Khyber Pskthukhawa. The results show that the majority of respondents have a good awareness of Islamic banks and the factors that determine the awareness are religious motivation and knowledge (Riaz, Burton, and Monk 2017).
The reputation of Islamic banks reflected in previous research indicates not yet optimal principles of the universality of Islamic banks. The principle of universality means that every Islamic banking product and service is acceptable to anyone without looking at the background such as religion, ethnicity, culture, language, gender, income level, education 78 level, social status and so on. Islamic banks are institutions that based on Islamic values, and the value of Islam is rahmatanlilalamin [2] that is to give the Islamic teachings love to all nature and all creatures. Islam also teaches justice to anyone [3] even to enemies and non-Muslims and also teach ahlakulkarimah or good behavior [4] against fellow human beings. Islamic Banks should apply this value so that all of society can accept their services and products. The principle of universality has widely echoed by many parties, including academics, practitioners, Muslim intellectuals, and government. Many Islamic banks have promoted the value of the universality value of their company in their product campaigns, and some have made the principle of universality the company's primary value. The government through the Central Bank and the Financial Services Authority has also campaigned for Islamic banks as banks for all parties and groups.
In addition to the image problem of Islamic banks as mentioned in paragraph 2, several other factors that become the development of Islamic banks in Indonesia is the ability to compete with conventional banks. Conventional banks have been older than Islamic banks in Indonesia thus conventional banks have higher competitiveness than Islamic banks in Indonesia Factors of conventional banks' excellence factors include physical resources and human resources. Physical resources include the number of offices, number of buildings and number of automated teller machines and so on then soft infrastructure such as mobile banking, SMS banking, and internet banking facilities. Human resources include marketers, personnel teller, customer service, and so forth. So it is necessary to investigate what exactly is a factor inhibiting the development of Islamic banks in Indonesia is whether the image factor of Islamic banks as a "bank only for Muslims only" or factor competitiveness with conventional banks.
Research Problem : What is the comparison between the performance of conventional banks and Islamic banks between the predominantly Muslim provinces and the majority of non-Muslim populations?

The Role of Religion with Banking Activity
Several previous studies have found a strong correlation between religious factors, religiosity and spirituality to banks.
An example is a study by Cantrell and Yust (2017) which investigates the relationship between religiosity and outcome private banks. They found that finding banks in areas of additional banking services, likely due to relationships formed from more risky lending (Cantrell and Yust 2018). Cantrel and Yust (2017) also find religiosity associated with lower earnings management and increased conservatism(Cantrell and Yust 2018). The behavior of banks according to researchers such as Adhikari and Agrawal (Adhikari and Agrawal 2016) is also influenced by the surrounding religious environment Banks headquartered in more religious areas exhibit lower stock return volatility, lower tail risk, and lower idiosyncratic risk. Moreover, banks in more religious areas remain less vulnerable to crises. Reducing risk, these banks grow their assets more slowly, hold safer assets, rely less on non-traditional banking, and provide fewer incentives to their executives to increase risks. Local religiosity has a more pronounced influence on risk-taking by banks for which local investors and managers are more critical (Adhikari and Agrawal 2016) The study of the motivation of Muslim customers to save money in banks on the dual banking system by Kontotet all (2016) is essential research. Thus, the paper explores the findings of a qualitative data through a face-to-face interview on factors of influencing customers' preferences for deposit products in Islamic banks(Kontot, Hamali, and Abdullah 2016). These results will used for developing a survey questionnaire for future empirical research. The faceto-face interview revealed that Islamic compliance, returns, confidence and trust, security, transparency, the flexibility of withdrawal scheme are among the determining factors that influence customers' preferences in making decisions. Safety and security, the human touch and zakat (alms) are the additional elements found to be missing from the literature. Future empirical research would include these elements as items in building up the survey instrument. Another study that reveals whether there is an influence of interest on Muslim customers in the country with dual banking system is Mushtaq and Danish Siddiqui(Mushtaq and Siddiqui 2017),

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So the basic purpose of this study is the decision of Muslim ' s decision while keeping their saving in banks. They used panel ARDL (Autoregressive Distributed Lag) method by using 23 non-Islamic and 23 Islamic countries data from 1999 to 2014 for this study. Results show that in Islamic countries interest rate do not have any impact on bank deposits both in the long run and short run. However, in the case of non-Islamic countries interest rate have a significant positive impact on bank deposits. Hence there is need of Islamic banks in countries with the more Muslim population and there should be different economic policies for Islamic countries as religious factor Affects Decision of Muslims and the interest rate does not have any impact on the bank's deposits.

The Role of Religion with Economic Activities
The religious factor does influence the economy. Several studies have revealed the principal activity of Islamic religion affecting the nation's economy as investigated by Wasiuzzaman which found that the influence of the Hajj pilgrimage on the Saudi stock market (Wasiuzzaman 2018). Stock returns of Tadawul All-Shares Index (TASI) and several sector indices from January 2010 to August 2014are used to examine the impact of the Hajj pilgrimage on the return and volatility of the stock indices. A Significant increase in volatility observed for the TASI and all the sector indices, except for the retail, agriculture and food and the petrochemical sectors. In addition to the pilgrimage, fasting during Ramadan also affects the Muslim country's economy, and this discovery recognized by Furthermore, this research also shows that about 40 to 50% of the consumers have the high level of religiosity.
Products made by the demand of Muslims such as Islamic banks and halal food is not only enjoyed by Muslims alone but also there are people outside of Islam who participate in consumption. Many factors contribute to the development of halal goods in an environment that is not an Islamic environment. Some important factors according to the study of Mathew et al. (2014) who wrote the motivation of non-Muslims to choose halal food in Malaysia is about the most important is the problem of food safety, the reason is Food safety is indeed a concern by all consumers generally (Mathew 2014). Country opinion should provide guidance on food that is harmful to health. Then the second reason is that food quality, the halal product described as a good product and high quality then the third is a factor The third variable tested was the respondents purchase intention in choosing halal food. The mean score value of 4.60 indicates that the sign of acceptance of halal food. Moreover, the fourth is because of voluntary attitude. A voluntary attitude in consuming halal goods arises because of interaction and acculturation with the Muslims around it. Other experts such as Said (2014) proclaim that the teachings of Islam strongly influence Muslim behavior and especially the teachings to consume halal goods.

Research Methods
The research approach is quantitative research. According to Emzir in Sarwono (2006) The Quantitative Approach is A research approach that primarily uses postpositivist paradigms (such as thinking about causality, reduction to variables, hypotheses and specific questions, 80 using measurement and observation, and theory testing) in developing science, using strategies such as experiments and surveys that require statistical data (Sarwono 2006). This research is Correlational research/survey is a standard approach to research that focuses on the assessment of the covariate among the variables that appear naturally. The goal is to identify predictive relationships using more sophisticated correlation techniques or statistical techniques (Emzir, n.d.). The purpose of this research is explanation group is aimed to explain, that is an express relationship between two or more concept or variable from a social phenomenon. (Hamidi in (Sarwono 2006)  In this study, the performance of Islamic and conventional banks measured are Third Party Fund (DPK) and financing (credit amount).

MANOVA for Third Party Funds
The hypothesis in MANOVA for the performance of third-party funds is as follows:   there is no influence of the spread of religion of the population in each province Indonesia to the performance of Islamic banks and conventional banks in this case Third Party Funds.

MANOVA forCredit Amount (Financing)
Hypotheses in MANOVA for financing performance are as follows:   there is no influence of the spread of religion of the population in each province Indonesia to the performance of Islamic banks and conventional banks in this case financing.

Discussion
The results show that there is no significant difference between the performance of   (Suhardi 2017). This fact indicates that consumer ratings of the integrity of bank employees affect trust, to save or other intermediary activities. The impression clients receive on the 85 integrity of their employees when they encounter problems, e.g. whether employees reveal the true values and principles of banking or whether bank employees resolve any problems faced by the customer according to the context and the current system will determine the customer's assessment of whether the bank trustworthy or not. These impressions serve as a benchmark for customer appraisal in determining whether the bank is doing honest practices in carrying out its intermediary function. The results of the causality test show that credibility affects brand trust. Credibility defined as the company's ability to meet customer expectations. The extent to which the company's experience in the industry assessed as deeply as to whether the company's expertise in its services by its customers. In the context of banking, the age of banks or bank employees who are considered senior in the banking business, forming an impression in the minds of its customers that the bank has sufficient expertise that deserves to be trusted.
Suhardi (2017) also issued the results of the causality test showed that benevolence affects k confidence (Suhardi 2017). The most important thing in the banking services industry is the existence of empathy for employees that can be perceived by the customer. The attitude of concern (concern) deep at its customer's bank employee became a sign of whether the bank is trustworthy or not. Employee attention to customers is an indicator for customers that banks have customer-oriented policies. For customers, this kind of policy is considered important considering the risk factor that must be borne by the customer when the bank's performance becomes worse.

Conclusion
From The Results and discussion it can be concluded several points: