How profitable a bank is has an effect on its long-term survivability. Earnings can 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 economic trouble. Conversely, losses reduce a bank's ability to do those things.
On Bankrate's test of earnings, Hills Bank and Trust Company scored 18 out of a possible 30, beating out the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important measure of a bank's earnings. Hills Bank and Trust Company's most recent annualized quarterly return on equity was 8.35 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $28.7 million on total equity of $355.5 million. The bank reported an annualized return on average assets, or ROA, of 1.03 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.