A bank's ability to earn money has an effect on its long-term survivability. A bank can retain its earnings, boosting its capital cushion, or put them to work addressing problematic loans, likely making the bank more resilient in tough times. Obviously, banks that are losing money are less able to do those things.
Friends Bank scored 12 out of a possible 30 on Bankrate's test of earnings, less than the national average of 16.52.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for Friends Bank was 5.69 percent, below the national average of 9.28 percent.
The bank earned net income of $243,000 on total equity of $8.7 million for the twelve months ended June 30, 2017. The bank reported an annualized return on average assets, or ROA, of 0.48 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.