How profitable a bank is affects its safety and soundness. Earnings may be retained by the bank, expanding its capital buffer, or be used to deal with problematic loans, potentially making the bank better prepared to withstand economic trouble. Conversely, losses reduce a bank's ability to do those things.
Federal Savings Bank received below-average marks on Bankrate's earnings test, achieving a score of 6 out of a possible 30.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one widely used measure of a bank's earnings. Federal Savings Bank's most recent annualized quarterly return on equity was 2.90 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $912,000 on total equity of $31.9 million. The bank reported an annualized return on average assets, or ROA, of 0.26 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.