A bank's earnings performance has an effect on its safety and soundness. Earnings may be retained by the bank, increasing its capital buffer, or be used to address problematic loans, likely making the bank more resilient in tough times. Banks that are losing money, however, have less ability to do those things.
Clarence State Bank scored 0 out of a possible 30 on Bankrate's test of earnings, less than the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for Clarence State Bank was -0.62 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $-26,000 on total equity of $4.2 million. The bank had an annualized return on average assets, or ROA, of -0.10 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.