A bank's ability to earn money affects its long-term survivability. A bank can retain its earnings, expanding its capital buffer, or use them to address problematic loans, potentially making the bank more resilient in tough times. Banks that are losing money, however, are less able to do those things.
Hiawatha National Bank fell short of the national average on Bankrate's test of earnings, achieving a score of 10 out of a possible 30.
One widely used measure of a bank's earnings is return on equity, or net income (profit, essentially) divided by the total amount of equity. The most recent annualized quarterly return on equity for Hiawatha National Bank was 4.31 percent, below the national average of 8.10 percent.
The bank earned net income of $876,000 on total equity of $21.1 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 0.45 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.