A bank's ability to earn money affects its safety and soundness. A bank can retain its earnings, increasing its capital cushion, or use them to address problematic loans, potentially making the bank better able to withstand economic trouble. Losses, on the other hand, take away from a bank's ability to do those things.
On Bankrate's test of earnings, Franklin State Bank scored 8 out of a possible 30, coming in below the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important way to measure a bank's earnings. Franklin State Bank's most recent annualized quarterly return on equity was 3.63 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $156,000 on total equity of $4.4 million. The bank experienced an annualized return on average assets, or ROA, of 0.54 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.