A bank's earnings performance affects its safety and soundness. A bank can retain its earnings, giving a boost to its capital cushion, or put them to work addressing problematic loans, likely making the bank more resilient in tough times. Conversely, losses diminish a bank's ability to do those things.
Bank Star One received below-average marks on Bankrate's earnings test, achieving a score of 6 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 Star One's most recent annualized quarterly return on equity was 3.22 percent, below the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank recorded net income of $223,000 on total equity of $17.0 million. The bank experienced an annualized return on average assets, or ROA, of 0.52 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.