A bank's profitability has an effect on its safety and soundness. Earnings can be retained by the bank, giving a boost to its capital cushion, or be used to address problematic loans, likely making the bank more resilient in times of trouble. Losses, on the other hand, take away from a bank's ability to do those things.
1st Equity Bank Northwest received above-average marks on Bankrate's test of earnings, achieving a score of 18 out of a possible 30.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one important measure of a bank's earnings. 1st Equity Bank Northwest's most recent annualized quarterly return on equity was 9.47 percent, above the national average of 8.10 percent.
The bank recorded net income of $824,000 on total equity of $8.9 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 2.11 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.