A bank's ability to earn money has an effect on its long-term survivability. Earnings can be retained by the bank, increasing its capital buffer, or be used to address problematic loans, likely making the bank more resilient in tough times. Obviously, banks that are losing money have less ability to do those things.
Bank of Cashton outperformed the average on Bankrate's test of earnings, achieving a score of 26 out of a possible 30.
One key way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. The most recent annualized quarterly return on equity for Bank of Cashton was 17.33 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $1.6 million on total equity of $9.3 million. The bank reported an annualized return on average assets, or ROA, of 1.90 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.