How profitable a bank is affects its safety and soundness. Earnings may be retained by the bank, boosting its capital buffer, or be used to address problematic loans, potentially making the bank more resilient in times of trouble. Losses, on the other hand, reduce a bank's ability to do those things.
On Bankrate's earnings test, First Community Bank scored 14 out of a possible 30, falling short of the national average of 15.12.
One widely used way to measure a bank's earnings is return on equity, or net income (profit, basically) divided by the total amount of equity. First Community Bank's most recent annualized quarterly return on equity was 6.02 percent, below the national average of 8.10 percent.
The bank reported net income of $869,000 on total equity of $14.5 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.63 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.