What it is
A balance sheet is a snapshot. It shows the bank on one day, the last day of the quarter, not over a period.
It has three parts. Assets are things the bank owns or is owed: cash, loans given to customers, investments, buildings. Liabilities are what the bank owes: customer deposits, borrowings, bonds. Equity is what is left for shareholders after every debt is paid.
The three always balance: Assets = Liabilities + Equity. That is why it is called a balance sheet. In Nepal, NFRS (Nepal Financial Reporting Standards) calls it the Statement of Financial Position, so quarterly reports print that heading.
For a bank, the balance sheet is unusual: deposits from the public are its biggest liability and loans to the public are its biggest asset. A bank is a middleman between the two.
How it is calculated
Total assets = Total liabilities + Total equity. Each side is a sum of its lines.
Worked on Nabil Bank Limited, FY 2082/83 Q4
On NABIL's FY 2082/83 Q4 statement, total assets were Rs 73,473.16 crore. Total liabilities were Rs 66,282.51 crore and total equity Rs 7,190.66 crore. Add the last two and you get the first.
What good looks like
Read it as proportions, not as big numbers. How much of assets is loans? How much of liabilities is deposits? How thick is the equity slice compared to total assets? Compare the same lines with the same quarter last year to see growth.
Watch out
- It is one day's picture. A bank can look different a week later.
- Quarterly balance sheets are unaudited. Year-end audited figures can change.
- Comparing with the previous quarter mixes seasons; the same quarter last year is the fairer comparison.
In Nepal
Nepali banks follow NFRS, so the heading is 'Statement of Financial Position' and the format follows NRB's prescribed quarterly template. Listed companies must publish the quarterly report within 30 days of quarter end (Securities Registration and Issue Regulations).
Questions
Because the bank owes that money back to depositors. It is money the bank holds for others, not money it owns.
No. Size shows scale, not health. A bank can grow assets by giving risky loans. Look at loan quality and capital alongside size.