A bank's profitability affects its safety and soundness. Earnings may be retained by the bank, giving a boost to its capital buffer, or be used to deal with problematic loans, potentially making the bank better able to withstand economic shocks. Obviously, banks that are losing money are less able to do those things.
On Bankrate's test of earnings, First Farmers & Commercial Bank scored 12 out of a possible 30, below the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for First Farmers & Commercial Bank was 5.63 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $731,000 on total equity of $13.2 million. The bank had 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.