A bank's profitability affects its safety and soundness. A bank can retain its earnings, giving a boost to its capital cushion, or use them to address problematic loans, potentially making the bank better prepared to withstand financial shocks. Conversely, losses reduce a bank's ability to do those things.
First Minnetonka City Bank beat the national average on Bankrate's test of earnings, achieving a score of 22 out of a possible 30.
Return on equity, calculated by dividing net income (essentially, profit) 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 Minnetonka City Bank was 12.32 percent, above the national average of 8.10 percent.
The bank recorded net income of $2.7 million on total equity of $22.2 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 1.25 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.