How profitable a bank is has an effect on its safety and soundness. Earnings can be retained by the bank, increasing its capital cushion, or be used to deal with problematic loans, potentially making the bank better prepared to withstand economic trouble. Losses, on the other hand, diminish a bank's ability to do those things.
On Bankrate's test of earnings, Capitol Bank scored 18 out of a possible 30, better than the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by the total amount of equity, is one key measure of a bank's earnings. The most recent annualized quarterly return on equity for Capitol Bank was 8.48 percent, above the national average of 8.10 percent.
The bank reported net income of $3.2 million on total equity of $38.6 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 0.91 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.