Discussion on the balance sheet and income statement
The table above gives an overview of the balance sheet and income statement of the banks. The balance sheet section shows a summary of the assets and liabilities. The classification is based on the equation cash asset (C) + security holdings (S) + loans (L) + miscellaneous assets (MA) = deposit account (D) + non-deposit borrowing (NDB) + equity capital (EC). The cash asset is made up of cash and balances with the Saudi Arabian Monetary Authority (SAMA) and other central banks and amounts due from banks and other financial institutions. These two items yield a sum of SR68,728,430. The bank does not have loan balances in its books.
Further, miscellaneous assets that are made up of property and equipment, investment properties, and other assets amount to SR11,956,384. The total amount of the equations on the left-hand side is SR339,711,817. On the right-hand side of the equation, the deposit account is made up of the amount that the bank owes other financial institutions and customers’ deposits. The two items sums to SR281,510,106. Other liabilities make up non-deposit borrowing (SR6,254,839). Finally, equity capital is made up of share capital, reserves, and retained earnings. The total amount of equity capital is SR51,946,872. The sum of the components on the right-hand side is SR339,711,817.
In the income statement, the net interest income amounts to SR9,023,076 while the sum of net noninterest income is (SR897,116). It can be observed that the noninterest expenses exceed the noninterest income. This created a loss from the noninterest activities. This can be interpreted that the income generated from noninterest activities cannot cover the corresponding expenses. Further, the bank generated a higher amount of revenue from interest generating activities than from noninterest activities. The sum of net interest income and net non-interest income is SR8,125,960. This total is equivalent to the net income for the year.