How profitable a bank is affects its safety and soundness. A bank can retain its earnings, expanding its capital cushion, or put them to work addressing problematic loans, likely making the bank better able to withstand economic shocks. Obviously, banks that are losing money are less able to do those things.
On Bankrate's earnings test, First State Bank scored 24 out of a possible 30, beating the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for First State Bank was 15.03 percent, above the national average of 8.10 percent.
The bank recorded net income of $2.5 million on total equity of $17.1 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 1.80 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.