A bank's profitability affects its long-term survivability. A bank can retain its earnings, expanding its capital cushion, or use them to address problematic loans, likely making the bank better able to withstand financial trouble. Losses, on the other hand, reduce a bank's ability to do those things.
First Federal Savings and Loan Association received below-average marks on Bankrate's earnings test, achieving a score of 6 out of a possible 30.
Return on equity, calculated by dividing net income (profit, basically) by the total amount of equity, is one important way to measure a bank's earnings. First Federal Savings and Loan Association's most recent annualized quarterly return on equity was 2.26 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $156,000 on total equity of $7.0 million. The bank had an annualized return on average assets, or ROA, of 0.46 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.