A bank's profitability has an effect on its safety and soundness. Earnings can be retained by the bank, increasing its capital cushion, or be used to deal with problematic loans, likely making the bank better able to withstand financial trouble. Obviously, banks that are losing money are less able to do those things.
American Community Bank scored 10 out of a possible 30 on Bankrate's earnings test, below the national average of 16.52.
One widely used measure of a bank's earnings is return on equity, or net income (profit, essentially) divided by total equity. The most recent annualized quarterly return on equity for American Community Bank was 4.61 percent, below the national average of 9.28 percent.
The bank recorded net income of $594,000 on total equity of $25.7 million for the twelve months ended June 30, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.64 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.