A bank's earnings performance affects its safety and soundness. Earnings can be retained by the bank, boosting its capital buffer, or be used to address problematic loans, potentially making the bank better prepared to withstand economic shocks. Obviously, banks that are losing money are less able to do those things.
First Federal Savings and Loan Association of Valdosta scored 0 out of a possible 30 on Bankrate's test of earnings, lower than the national average of 15.12.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one important way to measure a bank's earnings. First Federal Savings and Loan Association of Valdosta's most recent annualized quarterly return on equity was -0.50 percent, below the national average of 8.10 percent.
The bank recorded net income of $-142,000 on total equity of $28.3 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of -0.08 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.