How profitable a bank is has an effect on its safety and soundness. Earnings may be retained by the bank, boosting its capital cushion, or be used to deal with problematic loans, likely making the bank more resilient in tough times. Banks that are losing money, however, are less able to do those things.
River City Bank scored 16 out of a possible 30 on Bankrate's earnings test, below the national average of 16.52.
One important way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by the total amount of equity. River City Bank's most recent annualized quarterly return on equity was 7.27 percent, below the national average of 9.28 percent.
The bank recorded net income of $573,000 on total equity of $16.2 million for the twelve months ended June 30, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.74 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.