A bank's profitability affects its safety and soundness. Earnings may be retained by the bank, boosting its capital buffer, or be used to address problematic loans, potentially making the bank better prepared to withstand economic trouble. Banks that are losing money, however, have less ability to do those things.
Comenity Capital Bank scored 30 out of a possible 30 on Bankrate's earnings test, beating the national average of 15.12.
One important measure of a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by the total amount of equity. Comenity Capital Bank's most recent annualized quarterly return on equity was 24.18 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $232.9 million on total equity of $1.08 billion. The bank experienced an annualized return on average assets, or ROA, of 3.16 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.