A bank's ability to earn money has an effect on its long-term survivability. A bank can retain its earnings, giving a boost to its capital buffer, or use them to address problematic loans, potentially making the bank more resilient in tough times. Obviously, banks that are losing money have less ability to do those things.
Bank of Walker County received below-average marks on Bankrate's test of earnings, achieving a score of 10 out of a possible 30.
One key way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by the total amount of equity. The most recent annualized quarterly return on equity for Bank of Walker County was 4.30 percent, below the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank earned net income of $185,000 on total equity of $8.6 million. The bank reported an annualized return on average assets, or ROA, of 0.58 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.