A bank's ability to earn money affects its long-term survivability. A bank can retain its earnings, expanding its capital cushion, or put them to work addressing problematic loans, likely making the bank more resilient in tough times. Losses, on the other hand, reduce a bank's ability to do those things.
Hometown Bank of the Hudson Valley scored 0 out of a possible 30 on Bankrate's test of earnings, below the national average of 16.52.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important way to measure a bank's earnings. Hometown Bank of the Hudson Valley's most recent annualized quarterly return on equity was -7.82 percent, below the national average of 9.28 percent.
The bank recorded net income of $-280,000 on total equity of $7.0 million for the twelve months ended June 30, 2017. The bank reported an annualized return on average assets, or ROA, of -0.47 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.