A bank's profitability has an effect on its safety and soundness. A bank can retain its earnings, giving a boost to its capital buffer, or use them to address problematic loans, potentially making the bank more resilient in tough times. Losses, on the other hand, take away from a bank's ability to do those things.
On Bankrate's test of earnings, Franklin Savings Bank scored 8 out of a possible 30, less than 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. Franklin Savings Bank's most recent annualized quarterly return on equity was 3.67 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $3.5 million on total equity of $97.2 million. The bank reported an annualized return on average assets, or ROA, of 0.92 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.