A bank's earnings performance has an effect on its long-term survivability. 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. Losses, on the other hand, reduce a bank's ability to do those things.
Dakota Heritage Bank of North Dakota scored 26 out of a possible 30 on Bankrate's test of earnings, exceeding the national average of 15.12.
One widely used measure of a bank's earnings is return on equity, or net income (profit, essentially) divided by the total amount of equity. Dakota Heritage Bank of North Dakota's most recent annualized quarterly return on equity was 16.59 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $3.5 million on total equity of $21.7 million. The bank had an annualized return on average assets, or ROA, of 1.78 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.