A bank's profitability affects its safety and soundness. A bank can retain its earnings, giving a boost to its capital cushion, or put them to work addressing problematic loans, likely making the bank better able to withstand financial shocks. However, banks that are losing money are less able to do those things.
Banco Popular North America received below-average marks on Bankrate's test of earnings, achieving a score of 6 out of a possible 30.
One widely used way to measure a bank's earnings is return on equity, or net income (profit, basically) divided by the total amount of equity. The most recent annualized quarterly return on equity for Banco Popular North America was 2.36 percent, below the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank recorded net income of $21.7 million on total equity of $1.85 billion. The bank reported an annualized return on average assets, or ROA, of 0.49 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.