How profitable a bank is has an effect on its safety and soundness. Earnings may be retained by the bank, boosting its capital buffer, or be used to address problematic loans, potentially making the bank more resilient in times of trouble. Conversely, losses reduce a bank's ability to do those things.
Kentland Federal Savings and Loan Association scored 2 out of a possible 30 on Bankrate's earnings test, below the national average of 15.12.
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 Kentland Federal Savings and Loan Association was 0.87 percent, below the national average of 8.10 percent.
The bank reported net income of $5,000 on total equity of $581,000 for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.10 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.