A bank's earnings performance affects its long-term survivability. Earnings can be retained by the bank, boosting its capital buffer, or be used to address problematic loans, potentially making the bank better prepared to withstand financial trouble. Conversely, losses reduce a bank's ability to do those things.
First State Bank of Swanville received below-average marks on Bankrate's test of earnings, achieving a score of 2 out of a possible 30.
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 Swanville's most recent annualized quarterly return on equity was 0.67 percent, below the national average of 8.10 percent.
The bank recorded net income of $25,000 on total equity of $3.7 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.10 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.