How profitable a bank is has an effect on its long-term survivability. Earnings can be retained by the bank, giving a boost to its capital buffer, or be used to deal with problematic loans, likely making the bank more resilient in tough times. Obviously, banks that are losing money have less ability to do those things.
On Bankrate's earnings test, 1st Bank scored 22 out of a possible 30, better than the national average of 16.06.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one important way to measure a bank's earnings. 1st Bank's most recent annualized quarterly return on equity was 12.73 percent, above the national average of 8.10 percent.
The bank earned net income of $777,000 on total equity of $6.4 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 1.59 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.