How profitable a bank is affects its safety and soundness. A bank can retain its earnings, expanding 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 are less able to do those things.
Citizens Bank of Pagosa Springs received above-average marks on Bankrate's earnings test, achieving a score of 20 out of a possible 30.
One important way to measure a bank's earnings is return on equity, or net income (profit, basically) divided by the total amount of equity. The most recent annualized quarterly return on equity for Citizens Bank of Pagosa Springs was 10.75 percent, above the national average of 8.10 percent.
The bank reported net income of $791,000 on total equity of $7.6 million for the twelve months ended December 31, 2017. The bank had 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.