A bank's ability to earn money affects its safety and soundness. Earnings can be retained by the bank, boosting its capital cushion, or be used to deal with problematic loans, likely making the bank better able to withstand financial shocks. Banks that are losing money, however, are less able to do those things.
HNB First Bank scored 20 out of a possible 30 on Bankrate's earnings test, exceeding the national average of 15.12.
One widely used way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. HNB First Bank's most recent annualized quarterly return on equity was 10.37 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $1.4 million on total equity of $13.7 million. The bank reported an annualized return on average assets, or ROA, of 1.09 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.