How profitable a bank is has an effect on its safety and soundness. A bank can retain its earnings, expanding its capital cushion, or use them to address problematic loans, potentially making the bank more resilient in times of trouble. Losses, on the other hand, diminish a bank's ability to do those things.
First Community Bank scored 12 out of a possible 30 on Bankrate's earnings test, less than the national average of 15.12.
One widely used measure of a bank's earnings is return on equity, or net income (profit, basically) divided by total equity. First Community Bank's most recent annualized quarterly return on equity was 6.43 percent, below the national average of 8.10 percent.
The bank reported net income of $6.3 million on total equity of $115.5 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.67 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.