A bank's ability to earn money affects its long-term survivability. Earnings may be retained by the bank, boosting its capital cushion, or be used to deal with problematic loans, potentially making the bank more resilient in tough times. Conversely, losses lessen a bank's ability to do those things.
Alliance Bank received below-average marks on Bankrate's test of earnings, achieving a score of 14 out of a possible 30.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one widely used measure of a bank's earnings. The most recent annualized quarterly return on equity for Alliance Bank was 6.41 percent, below the national average of 8.10 percent.
The bank earned net income of $703,000 on total equity of $11.3 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.67 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.