A bank's ability to earn money has an effect on its long-term survivability. A bank can retain its earnings, boosting its capital cushion, or use them to address problematic loans, likely making the bank more resilient in times of trouble. Banks that are losing money, however, are less able to do those things.
Farmers State Bank of West Concord exceeded the national average on Bankrate's test of earnings, achieving a score of 18 out of a possible 30.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by total equity. The most recent annualized quarterly return on equity for Farmers State Bank of West Concord was 8.20 percent, above the national average of 8.10 percent.
The bank reported net income of $426,000 on total equity of $5.3 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.86 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.