A bank's earnings performance has an effect on its safety and soundness. A bank can retain its earnings, expanding its capital buffer, or use them to address problematic loans, potentially making the bank better prepared to withstand financial shocks. Losses, on the other hand, take away from a bank's ability to do those things.
On Bankrate's earnings test, CommunityBank of Texas, N.A. scored 14 out of a possible 30, failing to reach the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one key measure of a bank's earnings. The most recent annualized quarterly return on equity for CommunityBank of Texas, N.A. was 7.13 percent, below the national average of 8.10 percent.
The bank reported net income of $28.4 million on total equity of $407.3 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.95 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.