A bank's ability to earn money affects its long-term survivability. A bank can retain its earnings, expanding its capital buffer, or put them to work addressing problematic loans, potentially making the bank more resilient in times of trouble. Banks that are losing money, however, have less ability to do those things.
Gateway Commercial Bank fell behind the national average on Bankrate's earnings test, achieving a score of 12 out of a possible 30.
Return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity, is one key measure of a bank's earnings. The most recent annualized quarterly return on equity for Gateway Commercial Bank was 5.81 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $892,000 on total equity of $15.7 million. The bank had an annualized return on average assets, or ROA, of 0.73 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.