A bank's profitability has an effect on its safety and soundness. Earnings may be retained by the bank, giving a boost to its capital buffer, or be used to address problematic loans, potentially making the bank better able to withstand economic trouble. Losses, on the other hand, reduce a bank's ability to do those things.
On Bankrate's earnings test, Bath Savings Institution scored 20 out of a possible 30, exceeding the national average of 15.12.
One important measure of a bank's earnings is return on equity, or net income (profit, basically) divided by total equity. Bath Savings Institution's most recent annualized quarterly return on equity was 10.73 percent, above the national average of 8.10 percent.
The bank earned net income of $11.4 million on total equity of $112.9 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 1.31 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.