A bank's profitability affects its safety and soundness. A bank can retain its earnings, giving a boost to its capital buffer, or put them to work addressing problematic loans, potentially making the bank better prepared to withstand economic shocks. However, banks that are losing money have less ability to do those things.
Kentucky Bank scored 18 out of a possible 30 on Bankrate's test of earnings, beating the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important measure of a bank's earnings. The most recent annualized quarterly return on equity for Kentucky Bank was 9.98 percent, above the national average of 8.10 percent.
The bank earned net income of $10.4 million on total equity of $105.1 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 1.01 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.