A bank's ability to earn money has an effect on its long-term survivability. A bank can retain its earnings, boosting its capital buffer, or put them to work addressing problematic loans, potentially making the bank better prepared to withstand economic shocks. Obviously, banks that are losing money are less able to do those things.
Lawrenceburg Federal Bank received below-average marks on Bankrate's test of earnings, achieving a score of 8 out of a possible 30.
One important measure of a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by the total amount of equity. Lawrenceburg Federal Bank's most recent annualized quarterly return on equity was 4.07 percent, below the national average of 8.10 percent.
The bank earned net income of $575,000 on total equity of $14.4 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 0.93 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.