A bank's profitability affects its safety and soundness. Earnings may be retained by the bank, increasing its capital buffer, or be used to deal with problematic loans, likely making the bank more resilient in tough times. Banks that are losing money, however, are less able to do those things.
Bank of McCrory scored 16 out of a possible 30 on Bankrate's earnings test, falling short of the national average of 16.52.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important measure of a bank's earnings. The most recent annualized quarterly return on equity for Bank of McCrory was 7.36 percent, below the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank earned net income of $306,000 on total equity of $8.6 million. The bank had an annualized return on average assets, or ROA, of 0.77 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.