A bank's earnings performance has an effect on its long-term survivability. Earnings can be retained by the bank, increasing its capital buffer, or be used to deal with problematic loans, likely making the bank better prepared to withstand financial shocks. Losses, on the other hand, take away from a bank's ability to do those things.
First State Bank, Inc. scored 20 out of a possible 30 on Bankrate's test of earnings, beating the national average of 15.12.
One important way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by the total amount of equity. The most recent annualized quarterly return on equity for First State Bank, Inc. was 12.65 percent, above the national average of 8.10 percent.
The bank recorded net income of $1.3 million on total equity of $11.4 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 1.01 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.