How profitable a bank is has an effect on its safety and soundness. Earnings can be retained by the bank, giving a boost to its capital cushion, or be used to address problematic loans, potentially making the bank better prepared to withstand economic shocks. Banks that are losing money, however, are less able to do those things.
On Bankrate's test of earnings, HomeTown Bank, National Association scored 18 out of a possible 30, beating out the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity, is one widely used measure of a bank's earnings. The most recent annualized quarterly return on equity for HomeTown Bank, National Association was 10.25 percent, above the national average of 8.10 percent.
The bank reported net income of $6.2 million on total equity of $62.3 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 1.07 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.