A bank's ability to earn money affects its long-term survivability. Earnings can be retained by the bank, expanding its capital cushion, or be used to deal with problematic loans, potentially making the bank more resilient in times of trouble. Obviously, banks that are losing money have less ability to do those things.
Anderson State Bank scored 10 out of a possible 30 on Bankrate's test of earnings, failing to reach the national average of 16.52.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one important measure of a bank's earnings. The most recent annualized quarterly return on equity for Anderson State Bank was 4.31 percent, below the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank reported net income of $257,000 on total equity of $12.1 million. The bank experienced an annualized return on average assets, or ROA, of 0.62 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.