A bank's profitability has an effect on its long-term survivability. A bank can retain its earnings, expanding its capital cushion, or put them to work addressing problematic loans, potentially making the bank better prepared to withstand economic shocks. Losses, on the other hand, diminish a bank's ability to do those things.
First Community Bank of Cullman did below-average on Bankrate's earnings test, achieving a score of 10 out of a possible 30.
Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one important measure of a bank's earnings. The most recent annualized quarterly return on equity for First Community Bank of Cullman was 4.98 percent, below the national average of 8.10 percent.
The bank recorded net income of $446,000 on total equity of $9.2 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.55 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.