How profitable a bank is has an effect on its safety and soundness. A bank can retain its earnings, increasing its capital cushion, or use them to deal with problematic loans, likely making the bank better able to withstand financial trouble. Banks that are losing money, however, have less ability to do those things.
First Home Bank underperformed the average on Bankrate's earnings test, achieving a score of 8 out of a possible 30.
One important way to measure a bank's earnings is return on equity, or net income (profit, essentially) divided by the total amount of equity. The most recent annualized quarterly return on equity for First Home Bank was 3.31 percent, below the national average of 9.28 percent.
The bank earned net income of $316,000 on total equity of $19.4 million for the twelve months ended June 30, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.28 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.