A bank's ability to earn money affects its safety and soundness. A bank can retain its earnings, increasing its capital cushion, or put them to work addressing problematic loans, potentially making the bank more resilient in times of trouble. Losses, on the other hand, take away from a bank's ability to do those things.
On Bankrate's earnings test, Amory Federal Savings and Loan Association scored 8 out of a possible 30, less than the national average of 16.52.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one important measure of a bank's earnings. The most recent annualized quarterly return on equity for Amory Federal Savings and Loan Association was 3.37 percent, below the national average of 9.28 percent.
The bank recorded net income of $182,000 on total equity of $10.9 million for the twelve months ended June 30, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.42 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.