A bank's ability to earn money has an effect on its safety and soundness. Earnings may be retained by the bank, boosting its capital cushion, or be used to deal with problematic loans, likely making the bank more resilient in tough times. Conversely, losses take away from a bank's ability to do those things.
On Bankrate's test of earnings, First State Bank scored 24 out of a possible 30, better than the national average of 15.12.
One widely used measure of a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by total equity. First State Bank's most recent annualized quarterly return on equity was 14.24 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $13.4 million on total equity of $94.9 million. The bank had an annualized return on average assets, or ROA, of 1.27 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.