A bank's ability to earn money affects its long-term survivability. Earnings can be retained by the bank, giving a boost to its capital buffer, or be used to deal with problematic loans, likely making the bank more resilient in tough times. However, banks that are losing money are less able to do those things.
Old Second National Bank scored 20 out of a possible 30 on Bankrate's earnings test, beating the national average of 16.52.
Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one important measure of a bank's earnings. Old Second National Bank's most recent annualized quarterly return on equity was 10.79 percent, above the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank recorded net income of $12.7 million on total equity of $246.0 million. The bank experienced an annualized return on average assets, or ROA, of 1.11 percent, above the 1 percent deemed satisfactory in accordance with industry standards, but below the average for U.S. banks of 1.14 percent.