How profitable a bank is has an effect on its long-term survivability. A bank can retain its earnings, expanding its capital buffer, or put them to work addressing problematic loans, likely making the bank better able to withstand financial shocks. Losses, on the other hand, lessen a bank's ability to do those things.
On Bankrate's earnings test, Avon Co-operative Bank scored 2 out of a possible 30, falling short of the national average of 16.52.
One widely used measure of a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. Avon Co-operative Bank's most recent annualized quarterly return on equity was 0.48 percent, below the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank recorded net income of $22,000 on total equity of $9.3 million. The bank experienced an annualized return on average assets, or ROA, of 0.05 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.