How profitable a bank is affects its long-term survivability. Earnings can be retained by the bank, expanding its capital buffer, or be used to address problematic loans, potentially making the bank better prepared to withstand financial trouble. Conversely, losses take away from a bank's ability to do those things.
Farmers Savings Bank scored 10 out of a possible 30 on Bankrate's earnings test, failing to reach the national average of 15.12.
One key way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity. Farmers Savings Bank's most recent annualized quarterly return on equity was 4.39 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $621,000 on total equity of $14.2 million. The bank experienced an annualized return on average assets, or ROA, of 0.63 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.