A bank's ability to earn money has an effect on its safety and soundness. Earnings may be retained by the bank, giving a boost to its capital buffer, or be used to address problematic loans, potentially making the bank more resilient in times of trouble. Losses, on the other hand, take away from a bank's ability to do those things.
On Bankrate's earnings test, First State Bank of Bedias scored 22 out of a possible 30, better than the national average of 15.12.
One key way to measure a bank's earnings is return on equity, or net income (essentially profit) divided by total equity. First State Bank of Bedias's most recent annualized quarterly return on equity was 12.79 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $2.9 million on total equity of $23.1 million. The bank had an annualized return on average assets, or ROA, of 1.82 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.