How profitable a bank is affects its safety and soundness. A bank can retain its earnings, increasing its capital cushion, or put them to work addressing problematic loans, likely making the bank more resilient in tough times. Conversely, losses reduce a bank's ability to do those things.
Farmington State Bank scored 10 out of a possible 30 on Bankrate's test of earnings, lower than the national average of 15.12.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (essentially profit) by the total amount of equity. The most recent annualized quarterly return on equity for Farmington State Bank was 4.53 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $75,000 on total equity of $1.6 million. The bank reported an annualized return on average assets, or ROA, of 0.73 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.