A bank's profitability has an effect on its safety and soundness. Earnings can be retained by the bank, expanding its capital cushion, or be used to deal with problematic loans, potentially making the bank better prepared to withstand financial trouble. Losses, on the other hand, diminish a bank's ability to do those things.
On Bankrate's test of earnings, Citizens State Bank scored 16 out of a possible 30, exceeding the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by the total amount of equity, is one important way to measure a bank's earnings. Citizens State Bank's most recent annualized quarterly return on equity was 7.94 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $791,000 on total equity of $10.1 million. The bank experienced an annualized return on average assets, or ROA, of 1.06 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.