A bank's earnings performance affects its safety and soundness. A bank can retain its earnings, increasing its capital cushion, or use them to deal with problematic loans, likely making the bank more resilient in times of trouble. Conversely, losses diminish a bank's ability to do those things.
Bonanza Valley State Bank did above-average on Bankrate's test of earnings, achieving a score of 22 out of a possible 30.
Return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity, is one important measure of a bank's earnings. The most recent annualized quarterly return on equity for Bonanza Valley State Bank was 13.12 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $739,000 on total equity of $5.8 million. The bank experienced an annualized return on average assets, or ROA, of 1.17 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.