A bank's ability to earn money has an effect on its safety and soundness. Earnings can be retained by the bank, giving a boost to its capital buffer, or be used to deal with problematic loans, potentially making the bank better able to withstand financial shocks. Obviously, banks that are losing money are less able to do those things.
On Bankrate's test of earnings, Bank of the West scored 22 out of a possible 30, exceeding the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for Bank of the West was 12.86 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $5.5 million on total equity of $43.5 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.