How profitable a bank is has an effect on its safety and soundness. Earnings can be retained by the bank, boosting its capital cushion, or be used to address problematic loans, potentially making the bank more resilient in times of trouble. Conversely, losses diminish a bank's ability to do those things.
On Bankrate's earnings test, Farmers Bank & Trust scored 20 out of a possible 30, exceeding the national average of 16.52.
Return on equity, calculated by dividing net income (profit, basically) by the total amount of equity, is one important way to measure a bank's earnings. Farmers Bank & Trust's most recent annualized quarterly return on equity was 11.97 percent, above the national average of 9.28 percent.
The bank reported net income of $7.9 million on total equity of $137.3 million for the twelve months ended June 30, 2017. The bank had an annualized return on average assets, or ROA, of 1.97 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.14 percent.