A bank's earnings performance affects its long-term survivability. Earnings may be retained by the bank, boosting its capital buffer, or be used to deal with problematic loans, likely making the bank more resilient in tough times. Losses, on the other hand, diminish a bank's ability to do those things.
On Bankrate's earnings test, Farmers State Bank scored 20 out of a possible 30, above the national average of 15.12.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one key measure of a bank's earnings. The most recent annualized quarterly return on equity for Farmers State Bank was 11.02 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $635,000 on total equity of $5.8 million. The bank had an annualized return on average assets, or ROA, of 1.25 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.