How profitable a bank is has an effect on its safety and soundness. Earnings can be retained by the bank, boosting its capital cushion, or be used to deal with problematic loans, likely making the bank better prepared to withstand economic shocks. Conversely, losses reduce a bank's ability to do those things.
Lena State Bank scored 18 out of a possible 30 on Bankrate's test of earnings, above the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by the total amount of equity, is one key measure of a bank's earnings. Lena State Bank's most recent annualized quarterly return on equity was 9.73 percent, above the national average of 8.10 percent.
The bank reported net income of $938,000 on total equity of $9.7 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 1.05 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.