A bank's profitability has an effect on its safety and soundness. A bank can retain its earnings, increasing its capital buffer, or put them to work addressing problematic loans, likely making the bank better prepared to withstand financial trouble. Losses, on the other hand, diminish a bank's ability to do those things.
First Bank of the Palm Beaches fell behind the national average on Bankrate's test of earnings, achieving a score of 0 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. First Bank of the Palm Beaches's most recent annualized quarterly return on equity was -0.13 percent, below the national average of 8.10 percent.
The bank earned net income of $-19,000 on total equity of $14.6 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of -0.01 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.