A bank's earnings performance affects its long-term survivability. Earnings may be retained by the bank, boosting its capital buffer, or be used to deal with problematic loans, potentially making the bank better able to withstand financial shocks. Conversely, losses take away from a bank's ability to do those things.
On Bankrate's earnings test, Andalusia Community Bank scored 6 out of a possible 30, lower than the national average of 16.52.
Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one widely used measure of a bank's earnings. The most recent annualized quarterly return on equity for Andalusia Community Bank was 2.93 percent, below the national average of 9.28 percent.
The bank recorded net income of $86,000 on total equity of $5.9 million for the twelve months ended June 30, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.43 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.