How profitable a bank is has an effect on its safety and soundness. Earnings can be retained by the bank, expanding its capital buffer, or be used to address problematic loans, likely making the bank more resilient in tough times. Obviously, banks that are losing money are less able to do those things.
On Bankrate's test of earnings, First Bank Richmond scored 12 out of a possible 30, falling short of the national average of 16.52.
Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for First Bank Richmond was 5.20 percent, below the national average of 9.28 percent.
The bank reported net income of $1.9 million on total equity of $75.7 million for the twelve months ended June 30, 2017. The bank reported an annualized return on average assets, or ROA, of 0.55 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.