A bank's earnings performance affects its safety and soundness. Earnings may be retained by the bank, expanding its capital cushion, or be used to address problematic loans, potentially making the bank more resilient in tough times. However, banks that are losing money are less able to do those things.
Texas Hill Country Bank scored 14 out of a possible 30 on Bankrate's earnings test, coming in below the national average of 16.52.
One important way to measure a bank's earnings is return on equity, or net income (profit, essentially) divided by total equity. The most recent annualized quarterly return on equity for Texas Hill Country Bank was 6.93 percent, below the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank recorded net income of $413,000 on total equity of $12.2 million. The bank had an annualized return on average assets, or ROA, of 0.82 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.