A bank's ability to earn money has an effect on its safety and soundness. 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, reduce a bank's ability to do those things.
On Bankrate's earnings test, Farmers & Traders Savings Bank scored 18 out of a possible 30, beating out the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one important way to measure a bank's earnings. Farmers & Traders Savings Bank's most recent annualized quarterly return on equity was 8.51 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $498,000 on total equity of $5.9 million. The bank reported an annualized return on average assets, or ROA, of 0.88 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.