A bank's ability to earn money has an effect on its safety and soundness. A bank can retain its earnings, giving a boost to its capital cushion, or use them to deal with problematic loans, potentially making the bank better able to withstand financial shocks. Losses, on the other hand, reduce a bank's ability to do those things.
Citizens State Bank, of Arlington fell short of the national average on Bankrate's earnings test, achieving a score of 14 out of a possible 30.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important measure of a bank's earnings. Citizens State Bank, of Arlington's most recent annualized quarterly return on equity was 6.53 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $944,000 on total equity of $14.3 million. The bank had an annualized return on average assets, or ROA, of 0.90 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.