A bank's earnings performance has an effect on its safety and soundness. A bank can retain its earnings, increasing its capital buffer, or put them to work addressing problematic loans, likely making the bank better prepared to withstand economic shocks. Losses, on the other hand, lessen a bank's ability to do those things.
On Bankrate's test of earnings, Farmers and Miners Bank scored 12 out of a possible 30, below the national average of 15.12.
One widely used way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity. The most recent annualized quarterly return on equity for Farmers and Miners Bank was 5.24 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $937,000 on total equity of $17.8 million. The bank had an annualized return on average assets, or ROA, of 0.69 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.