A bank's profitability has an effect on its long-term survivability. Earnings can be retained by the bank, increasing its capital buffer, or be used to deal with problematic loans, likely making the bank better prepared to withstand economic shocks. Conversely, losses diminish a bank's ability to do those things.
First Federal Savings and Loan Association of Lorain scored 2 out of a possible 30 on Bankrate's earnings test, lower than the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one key measure of a bank's earnings. First Federal Savings and Loan Association of Lorain's most recent annualized quarterly return on equity was 0.01 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $5,000 on total equity of $63.4 million. The bank reported an annualized return on average assets, or ROA, of 0.00 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.