How profitable a bank is has an effect on its safety and soundness. Earnings may be retained by the bank, giving a boost to its capital buffer, or be used to address problematic loans, likely making the bank more resilient in tough times. Conversely, losses diminish a bank's ability to do those things.
Home Federal Savings and Loan Association underperformed the average on Bankrate's test of earnings, achieving a score of 8 out of a possible 30.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important way to measure a bank's earnings. Home Federal Savings and Loan Association's most recent annualized quarterly return on equity was 3.99 percent, below the national average of 8.10 percent.
The bank recorded net income of $197,000 on total equity of $5.1 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 0.48 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.