A bank's earnings performance affects its long-term survivability. Earnings may be retained by the bank, expanding its capital buffer, or be used to deal with problematic loans, likely making the bank better prepared to withstand financial shocks. Banks that are losing money, however, are less able to do those things.
On Bankrate's test of earnings, Grapeland State Bank scored 12 out of a possible 30, falling short of the national average of 15.12.
One important measure of a bank's earnings is return on equity, or net income (essentially profit) divided by the total amount of equity. Grapeland State Bank's most recent annualized quarterly return on equity was 5.67 percent, below the national average of 8.10 percent.
The bank earned net income of $224,000 on total equity of $3.9 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.68 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.