How profitable a bank is has an effect on its long-term survivability. A bank can retain its earnings, boosting its capital cushion, or put them to work addressing problematic loans, likely making the bank more resilient in tough times. Banks that are losing money, however, have less ability to do those things.
Home Federal Savings Bank received below-average marks on Bankrate's earnings test, achieving a score of 14 out of a possible 30.
One important measure of a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by the total amount of equity. Home Federal Savings Bank's most recent annualized quarterly return on equity was 6.21 percent, below the national average of 8.10 percent.
The bank recorded net income of $4.9 million on total equity of $77.0 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.69 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.