A bank's ability to earn money affects its safety and soundness. A bank can retain its earnings, expanding its capital buffer, or put them to work addressing problematic loans, potentially making the bank better prepared to withstand economic shocks. Conversely, losses diminish a bank's ability to do those things.
Bank of O'Fallon exceeded the national average on Bankrate's earnings test, achieving a score of 18 out of a possible 30.
One important way to measure a bank's earnings is return on equity, or net income (profit, essentially) divided by total equity. Bank of O'Fallon's most recent annualized quarterly return on equity was 8.79 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $3.6 million on total equity of $41.6 million. The bank had an annualized return on average assets, or ROA, of 1.20 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.