A bank's profitability affects its long-term survivability. Earnings can be retained by the bank, expanding its capital buffer, or be used to address problematic loans, potentially making the bank better able to withstand financial shocks. Conversely, losses lessen a bank's ability to do those things.
First State Bank scored 8 out of a possible 30 on Bankrate's test of earnings, below the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by the total amount of equity, is one widely used measure of a bank's earnings. The most recent annualized quarterly return on equity for First State Bank was 3.81 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $377,000 on total equity of $9.9 million. The bank reported an annualized return on average assets, or ROA, of 0.38 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.