A bank's earnings performance affects its safety and soundness. A bank can retain its earnings, increasing its capital buffer, or use them to address problematic loans, potentially making the bank more resilient in tough times. Losses, on the other hand, lessen a bank's ability to do those things.
Capital Bank of Texas scored 14 out of a possible 30 on Bankrate's earnings test, lower than the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important way to measure a bank's earnings. Capital Bank of Texas's most recent annualized quarterly return on equity was 6.68 percent, below the national average of 8.10 percent.
The bank recorded net income of $610,000 on total equity of $9.4 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 0.89 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.