A bank's ability to earn money affects its long-term survivability. Earnings can be retained by the bank, giving a boost to its capital cushion, or be used to address problematic loans, potentially making the bank more resilient in tough times. Conversely, losses take away from a bank's ability to do those things.
Lighthouse Bank scored 18 out of a possible 30 on Bankrate's earnings test, beating out the national average of 15.12.
One important way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity. The most recent annualized quarterly return on equity for Lighthouse Bank was 9.20 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $3.0 million on total equity of $34.4 million. The bank had an annualized return on average assets, or ROA, of 1.24 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.