A bank's ability to earn money affects its long-term survivability. A bank can retain its earnings, increasing its capital buffer, or use them to address problematic loans, likely making the bank better able to withstand economic trouble. Losses, on the other hand, reduce a bank's ability to do those things.
On Bankrate's earnings test, Baker-Boyer National Bank scored 20 out of a possible 30, beating the national average of 15.12.
One important way to measure a bank's earnings is return on equity, calculated by dividing net income (essentially profit) by the total amount of equity. Baker-Boyer National Bank's most recent annualized quarterly return on equity was 10.69 percent, above the national average of 8.10 percent.
The bank earned net income of $5.5 million on total equity of $51.5 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.91 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.