A bank's earnings performance affects its long-term survivability. Earnings can be retained by the bank, expanding its capital cushion, or be used to deal with problematic loans, likely making the bank better prepared to withstand financial shocks. However, banks that are losing money have less ability to do those things.
BankGloucester scored 12 out of a possible 30 on Bankrate's test of earnings, below the national average of 16.52.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for BankGloucester was 6.07 percent, below the national average of 9.28 percent.
The bank earned net income of $594,000 on total equity of $19.9 million for the twelve months ended June 30, 2017. The bank had an annualized return on average assets, or ROA, of 0.50 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.