How profitable a bank is has an effect on its long-term survivability. Earnings may be retained by the bank, boosting its capital buffer, or be used to address problematic loans, likely making the bank more resilient in times of trouble. Obviously, banks that are losing money are less able to do those things.
Farmers & Merchants State Bank of New York Mills, Incorporated scored 14 out of a possible 30 on Bankrate's earnings test, falling short of the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one key measure of a bank's earnings. Farmers & Merchants State Bank of New York Mills, Incorporated's most recent annualized quarterly return on equity was 6.66 percent, below the national average of 8.10 percent.
The bank earned net income of $589,000 on total equity of $8.9 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.89 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.