A bank's earnings performance has an effect on its safety and soundness. A bank can retain its earnings, increasing its capital cushion, or put them to work addressing problematic loans, likely making the bank better prepared to withstand financial trouble. Conversely, losses lessen a bank's ability to do those things.
Liberty Bank and Trust Company scored 14 out of a possible 30 on Bankrate's earnings test, below the national average of 16.52.
Return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity, is one key measure of a bank's earnings. Liberty Bank and Trust Company's most recent annualized quarterly return on equity was 6.48 percent, below the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank earned net income of $1.5 million on total equity of $49.1 million. The bank experienced an annualized return on average assets, or ROA, of 0.49 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 percent.