A bank's ability to earn money has an effect on its long-term survivability. A bank can retain its earnings, boosting its capital buffer, or put them to work addressing problematic loans, potentially making the bank more resilient in tough times. Banks that are losing money, however, are less able to do those things.
Frost State Bank scored 18 out of a possible 30 on Bankrate's earnings test, beating the national average of 15.12.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one important way to measure a bank's earnings. Frost State Bank's most recent annualized quarterly return on equity was 10.38 percent, above the national average of 8.10 percent.
The bank reported net income of $605,000 on total equity of $6.1 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 1.21 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.