A bank's earnings performance affects its safety and soundness. Earnings can be retained by the bank, increasing its capital cushion, or be used to address problematic loans, potentially making the bank better prepared to withstand economic shocks. Losses, on the other hand, reduce a bank's ability to do those things.
Home Banking Company scored 8 out of a possible 30 on Bankrate's test of earnings, failing to reach the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one important way to measure a bank's earnings. Home Banking Company's most recent annualized quarterly return on equity was 3.00 percent, below the national average of 8.10 percent.
The bank recorded net income of $276,000 on total equity of $9.1 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.30 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.