How profitable a bank is affects its safety and soundness. A bank can retain its earnings, expanding its capital buffer, or put them to work addressing 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.
On Bankrate's earnings test, Farmers State Bank scored 18 out of a possible 30, better than the national average of 15.12.
One widely used way to measure a bank's earnings is return on equity, or net income (essentially profit) divided by total equity. The most recent annualized quarterly return on equity for Farmers State Bank was 9.06 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $2.3 million on total equity of $26.8 million. The bank experienced an annualized return on average assets, or ROA, of 1.41 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.