A bank's earnings performance affects its safety and soundness. Earnings may be retained by the bank, giving a boost to its capital cushion, or be used to address problematic loans, potentially making the bank more resilient in times of trouble. Conversely, losses take away from a bank's ability to do those things.
Flora Bank & Trust did below-average on Bankrate's earnings test, achieving a score of 10 out of a possible 30.
One widely used way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. Flora Bank & Trust's most recent annualized quarterly return on equity was 5.08 percent, below the national average of 8.10 percent.
The bank recorded net income of $403,000 on total equity of $8.1 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 0.59 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.