A bank's ability to earn money has an effect on its long-term survivability. A bank can retain its earnings, giving a boost to its capital buffer, or use them to deal with problematic loans, potentially 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 test of earnings, Farmers & Stockmens Bank scored 26 out of a possible 30, beating out the national average of 15.12.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for Farmers & Stockmens Bank was 18.93 percent, above the national average of 8.10 percent.
The bank recorded net income of $4.4 million on total equity of $24.7 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 2.12 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.