A bank's earnings performance has an effect on its long-term survivability. A bank can retain its earnings, increasing its capital buffer, or use them to deal with problematic loans, likely making the bank more resilient in tough times. Losses, on the other hand, lessen a bank's ability to do those things.
On Bankrate's earnings test, First State Bank of Texas scored 0 out of a possible 30, below the national average of 15.12.
One widely used measure of a bank's earnings is return on equity, or net income (profit, essentially) divided by the total amount of equity. First State Bank of Texas's most recent annualized quarterly return on equity was -0.66 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $-150,000 on total equity of $22.8 million. The bank had 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.