A bank's profitability affects its long-term survivability. Earnings can be retained by the bank, increasing its capital cushion, or be used to address problematic loans, likely making the bank better able to withstand economic shocks. Banks that are losing money, however, have less ability to do those things.
Generations Bank scored 14 out of a possible 30 on Bankrate's test of earnings, falling short of the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity, is one important way to measure a bank's earnings. Generations Bank's most recent annualized quarterly return on equity was 6.97 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $290,000 on total equity of $4.3 million. The bank had an annualized return on average assets, or ROA, of 0.75 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.