How profitable a bank is has an effect on its long-term survivability. Earnings may be retained by the bank, expanding its capital buffer, or be used to deal with problematic loans, potentially making the bank better able to withstand financial trouble. Conversely, losses take away from a bank's ability to do those things.
First Iowa State Bank scored 26 out of a possible 30 on Bankrate's test of earnings, exceeding the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity, is one important measure of a bank's earnings. The most recent annualized quarterly return on equity for First Iowa State Bank was 13.83 percent, above the national average of 8.10 percent.
The bank reported net income of $2.8 million on total equity of $16.2 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 1.91 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.