A bank's ability to earn money has an effect on its safety and soundness. A bank can retain its earnings, giving a boost to its capital cushion, or put them to work addressing problematic loans, potentially making the bank better prepared to withstand financial shocks. Losses, on the other hand, diminish a bank's ability to do those things.
Kalamazoo County State Bank did below-average on Bankrate's earnings test, achieving a score of 0 out of a possible 30.
Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for Kalamazoo County State Bank was -1.23 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $-137,000 on total equity of $10.9 million. The bank had an annualized return on average assets, or ROA, of -0.14 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.