How profitable a bank is has an effect on its safety and soundness. Earnings may be retained by the bank, increasing its capital buffer, or be used to deal with problematic loans, likely making the bank more resilient in tough times. Losses, on the other hand, diminish a bank's ability to do those things.
On Bankrate's test of earnings, First Independence Bank scored 12 out of a possible 30, failing to reach 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 Independence Bank was 5.85 percent, below the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank earned net income of $535,000 on total equity of $24.9 million. The bank had an annualized return on average assets, or ROA, of 0.46 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.