A bank's profitability has an effect on its long-term survivability. A bank can retain its earnings, expanding its capital buffer, or use them to deal with problematic loans, likely making the bank better prepared to withstand economic trouble. Losses, on the other hand, reduce a bank's ability to do those things.
On Bankrate's earnings test, American Bank Center scored 18 out of a possible 30, beating the national average of 15.12.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by total equity. American Bank Center's most recent annualized quarterly return on equity was 8.85 percent, above the national average of 8.10 percent.
The bank reported net income of $10.7 million on total equity of $119.3 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 0.79 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.