How profitable a bank is has an effect on its safety and soundness. Earnings can be retained by the bank, expanding its capital buffer, or be used to deal with problematic loans, potentially making the bank more resilient in times of trouble. Conversely, losses take away from a bank's ability to do those things.
Heritage First Bank scored 18 out of a possible 30 on Bankrate's test of earnings, beating the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one important measure of a bank's earnings. Heritage First Bank's most recent annualized quarterly return on equity was 8.38 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $1.1 million on total equity of $13.5 million. The bank reported an annualized return on average assets, or ROA, of 0.85 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.