A bank's profitability affects its safety and soundness. Earnings may be retained by the bank, expanding its capital buffer, or be used to address problematic loans, potentially making the bank better prepared to withstand financial trouble. Banks that are losing money, however, have less ability to do those things.
On Bankrate's earnings test, Bank of Clarks scored 20 out of a possible 30, above the national average of 15.12.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. Bank of Clarks's most recent annualized quarterly return on equity was 11.32 percent, above the national average of 8.10 percent.
The bank reported net income of $451,000 on total equity of $4.0 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 1.31 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.