A bank's ability to earn money has an effect on its safety and soundness. A bank can retain its earnings, expanding its capital buffer, or use them to deal with problematic loans, potentially making the bank more resilient in times of trouble. Losses, on the other hand, lessen a bank's ability to do those things.
First Federal Savings and Loan Association of Van Wert scored 6 out of a possible 30 on Bankrate's earnings test, failing to reach 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. The most recent annualized quarterly return on equity for First Federal Savings and Loan Association of Van Wert was 2.48 percent, below the national average of 8.10 percent.
The bank earned net income of $542,000 on total equity of $21.9 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.50 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.