A bank's profitability has an effect on its safety and soundness. A bank can retain its earnings, increasing its capital cushion, or put them to work addressing problematic loans, likely making the bank more resilient in times of trouble. Obviously, banks that are losing money have less ability to do those things.
On Bankrate's earnings test, Belgrade State Bank scored 20 out of a possible 30, above the national average of 15.12.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (essentially profit) by total equity. Belgrade State Bank's most recent annualized quarterly return on equity was 10.60 percent, above the national average of 8.10 percent.
The bank recorded net income of $2.4 million on total equity of $22.6 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.96 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.