A bank's ability to earn money affects its safety and soundness. A bank can retain its earnings, giving a boost to its capital cushion, or use them to address problematic loans, potentially making the bank more resilient in tough times. However, banks that are losing money have less ability to do those things.
On Bankrate's earnings test, Arkansas County Bank scored 20 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. The most recent annualized quarterly return on equity for Arkansas County Bank was 9.98 percent, above the national average of 8.10 percent.
The bank earned net income of $1.8 million on total equity of $17.3 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 1.07 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.