How profitable a bank is has an effect on its safety and soundness. Earnings can be retained by the bank, boosting its capital buffer, or be used to address problematic loans, likely making the bank more resilient in times of trouble. Losses, on the other hand, reduce a bank's ability to do those things.
Arlington State Bank scored 20 out of a possible 30 on Bankrate's test of earnings, exceeding the national average of 16.52.
One key measure of a bank's earnings is return on equity, or net income (profit, essentially) divided by the total amount of equity. The most recent annualized quarterly return on equity for Arlington State Bank was 10.47 percent, above the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank reported net income of $282,000 on total equity of $5.5 million. The bank experienced an annualized return on average assets, or ROA, of 1.08 percent, above the 1 percent deemed satisfactory in accordance with industry standards, but below the average for U.S. banks of 1.14 percent.