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The financial statement is a crucial source of information about the financial status of all banks in the Kingdom, including their assets, liabilities and equity on a consolidated basis. By examining the statement, individuals with deposits in a bank can evaluate the financial stability and solvency of the bank, allowing them to make informed decisions about where to keep their money. This, in turn, can provide a sense of security, knowing that their deposits are with financially stable institutions. For individuals looking to borrow money, a consolidated balance sheet can be a useful tool in assessing a bank's lending capacity. By reviewing the balance sheet, individuals can determine whether the bank has sufficient liquidity and capital to lend money and meet its financial obligations.

According to the published data of the consolidated balance sheet of banks in Jordan, the volume of bank assets increased by JD3.8 billion or 5.1 per cent by the end of 2022. This is a slower growth rate than the 7.1 per cent increase seen at the end of 2021. The total balance at the end of 2022 reached about 64.1 billion dinars, indicating the cumulative volume, quality, and structure of banking activity in the Kingdom in 2022 compared to the previous year.

The rise in the consolidated balance sheet assets of banks in the Kingdom can be attributed to a 6.5 per cent increase in domestic assets, bringing the total to 58.3 billion dinars. On the other hand, foreign assets decreased by 7.3 per cent, reaching 5.9 billion dinars by the end of 2022 compared to the end of 2021

During 2022, the increase in domestic assets was primarily due to an 8 per cent increase in debts on the private sector (resident) and a 6.7 per cent increase in debts on the central government. This is a slower growth rate compared to 2021, which saw an increase of 9.4 per cent and 10.3 per cent, respectively.

Despite slower growth, it is evident that banks' financing activity for both public and private sectors continued to expand during 2022. The balance of bank debts on the public sector, in the form of bonds and treasury bills, increased from 14.3 billion dinars to 15.6 billion dinars, of which debts on the central government were approximately 14.1 billion dinars at the end of 2022 compared to 13.2 billion dinars in 2021. This underscores the significant role played by banks in financing the economy's public and private sectors. However, the government's preference to borrow from global markets by issuing international bonds in different forms and terms persisted. In 2022, the government's budget indicates that it borrowed about 2.9 billion dinars from global markets.

Meanwhile, the balance of bank debts on the private sector (resident) increased by approximately 2197.2 million dinars, reaching JD29.7 billion at the end of 2022. This reflects a rise in credit facilities for the private sector, which includes public services and utilities, individuals, construction, industry, and commerce.

The liabilities side of the consolidated balance sheet of banks provides information on the sources of financing and leverage ratios used by the banks. The data for 2022 indicates a slight increase in demand deposits of only 0.6 per cent, while time and savings deposits grew by 9.8 per cent. This increase in time and savings deposits can be attributed to the higher interest rates offered by banks, with the weighted average interest on time deposits increasing from 3.45 per cent in 2021 to 4.59 per cent in 2022, and to the preference of individuals to invest their surplus money in banks.

On the capital side, the total volume of reserves and allowances increased from about 9 billion dinars in 2021 to 9.4 billion dinars in 2022, reflecting the strength of the Jordanian banking sector and its ability to withstand various shocks and crises. As for the financial strength indicators, the capital adequacy ratio was at 17.1 per cent at the end of June 2022, significantly exceeding the requirements of the Central Bank and the international standards set by the Basel Committee. The return on shareholders' equity was at 8.2 per cent, and the non-performing loans ratio was 4.6 per cent, indicating that more than 95 per cent of loans are performing and being repaid on time by borrowers. This is a testament to the soundness of the credit process, the effective supervision of the Central Bank, and the ability of borrowers to repay their loans.