A bank's earnings performance affects its safety and soundness. A bank can retain its earnings, boosting its capital buffer, or put them to work addressing problematic loans, likely making the bank better able to withstand financial shocks. Losses, on the other hand, lessen a bank's ability to do those things.
Heritage Bank scored 18 out of a possible 30 on Bankrate's earnings test, exceeding the national average of 15.12.
One important measure of a bank's earnings is return on equity, or net income (profit, essentially) divided by the total amount of equity. Heritage Bank's most recent annualized quarterly return on equity was 9.85 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $2.9 million on total equity of $30.8 million. The bank had an annualized return on average assets, or ROA, of 1.13 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.