How profitable a bank is has an effect on its long-term survivability. 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. Banks that are losing money, however, have less ability to do those things.
Beartooth Bank fell behind the national average on Bankrate's earnings test, achieving a score of 0 out of a possible 30.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one widely used measure of a bank's earnings. Beartooth Bank's most recent annualized quarterly return on equity was -2.67 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $-197,000 on total equity of $7.2 million. The bank experienced an annualized return on average assets, or ROA, of -0.42 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.