How profitable a bank is has an effect on its safety and soundness. A bank can retain its earnings, increasing its capital buffer, or put them to work addressing problematic loans, likely making the bank more resilient in tough times. Losses, on the other hand, diminish a bank's ability to do those things.
On Bankrate's earnings test, Cayuga Lake National Bank scored 16 out of a possible 30, beating out the national average of 15.12.
One widely used measure of a bank's earnings is return on equity, or net income (essentially profit) divided by the total amount of equity. Cayuga Lake National Bank's most recent annualized quarterly return on equity was 7.91 percent, below the national average of 8.10 percent.
The bank earned net income of $969,000 on total equity of $12.2 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 0.63 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.