How profitable a bank is affects its safety and soundness. Earnings can be retained by the bank, expanding its capital cushion, or be used to address problematic loans, likely making the bank more resilient in times of trouble. Banks that are losing money, however, have less ability to do those things.
On Bankrate's earnings test, Bank of Montgomery scored 26 out of a possible 30, beating the national average of 15.12.
One key way to measure a bank's earnings is return on equity, or net income (essentially profit) divided by total equity. The most recent annualized quarterly return on equity for Bank of Montgomery was 17.36 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $6.0 million on total equity of $37.6 million. The bank reported an annualized return on average assets, or ROA, of 1.78 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.