A bank's profitability affects its safety and soundness. Earnings may be retained by the bank, expanding its capital buffer, or be used to address problematic loans, potentially making the bank more resilient in tough times. Losses, on the other hand, diminish a bank's ability to do those things.
Martha's Vineyard Savings Bank received below-average marks on Bankrate's test of earnings, achieving a score of 14 out of a possible 30.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one important way to measure a bank's earnings. Martha's Vineyard Savings Bank's most recent annualized quarterly return on equity was 6.40 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $5.8 million on total equity of $92.9 million. The bank experienced an annualized return on average assets, or ROA, of 0.72 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.