How profitable a bank is has an effect on its safety and soundness. A bank can retain its earnings, boosting its capital cushion, or put them to work addressing problematic loans, potentially making the bank better able to withstand financial trouble. However, banks that are losing money have less ability to do those things.
Iowa Falls State Bank scored 20 out of a possible 30 on Bankrate's earnings test, beating out the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one key measure of a bank's earnings. The most recent annualized quarterly return on equity for Iowa Falls State Bank was 11.57 percent, above the national average of 8.10 percent.
The bank reported net income of $1.7 million on total equity of $14.9 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 1.24 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.