How profitable a bank is has an effect on its long-term survivability. Earnings may be retained by the bank, giving a boost to its capital buffer, or be used to deal with 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.
On Bankrate's test of earnings, Heritage Bank, Inc. scored 18 out of a possible 30, beating out 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. Heritage Bank, Inc.'s most recent annualized quarterly return on equity was 9.17 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $6.2 million on total equity of $70.3 million. The bank had an annualized return on average assets, or ROA, of 0.87 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.