How profitable a bank is affects its safety and soundness. Earnings may be retained by the bank, boosting its capital buffer, or be used to address problematic loans, likely making the bank better prepared to withstand financial shocks. Losses, on the other hand, reduce a bank's ability to do those things.
On Bankrate's test of earnings, 1st Advantage Bank scored 8 out of a possible 30, lower than the national average of 15.12.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. 1st Advantage Bank's most recent annualized quarterly return on equity was 4.19 percent, below the national average of 8.10 percent.
The bank earned net income of $367,000 on total equity of $10.3 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.38 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.