How profitable a bank is has an effect on its safety and soundness. Earnings can be retained by the bank, boosting its capital buffer, or be used to address problematic loans, potentially making the bank better prepared to withstand financial shocks. However, banks that are losing money are less able to do those things.
Texas Gulf Bank, National Association scored 20 out of a possible 30 on Bankrate's test of earnings, beating out the national average of 16.52.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by the total amount of equity. Texas Gulf Bank, National Association's most recent annualized quarterly return on equity was 10.77 percent, above the national average of 9.28 percent.
The bank recorded net income of $3.3 million on total equity of $63.4 million for the twelve months ended June 30, 2017. The bank had an annualized return on average assets, or ROA, of 1.14 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and equal to the average for U.S. banks of 1.14 percent.