A bank's ability to earn money affects its safety and soundness. Earnings may be retained by the bank, expanding its capital buffer, or be used to address problematic loans, likely making the bank better able to withstand economic trouble. Conversely, losses take away from a bank's ability to do those things.
1st Bank in Hominy underperformed the average on Bankrate's test of earnings, achieving a score of 16 out of a possible 30.
Return on equity, calculated by dividing net income (profit, basically) by the total amount of equity, is one important measure of a bank's earnings. The most recent annualized quarterly return on equity for 1st Bank in Hominy was 7.07 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $239,000 on total equity of $3.4 million. The bank reported an annualized return on average assets, or ROA, of 0.57 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.