A bank's profitability has an effect on its safety and soundness. A bank can retain its earnings, increasing its capital buffer, or use them to deal with problematic loans, likely making the bank better able to withstand economic trouble. Banks that are losing money, however, have less ability to do those things.
First National Bank of Central Texas scored 30 out of a possible 30 on Bankrate's earnings test, beating out the national average of 15.12.
One key way to measure a bank's earnings is return on equity, calculated by dividing net income (essentially profit) by the total amount of equity. First National Bank of Central Texas's most recent annualized quarterly return on equity was 22.17 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $16.1 million on total equity of $76.3 million. The bank experienced an annualized return on average assets, or ROA, of 2.03 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.