How profitable a bank is has an effect on its safety and soundness. Earnings may be retained by the bank, giving a boost to its capital buffer, or be used to deal with problematic loans, potentially making the bank better prepared to withstand financial trouble. Obviously, banks that are losing money have less ability to do those things.
On Bankrate's test of earnings, McClain Bank scored 20 out of a possible 30, exceeding the national average of 15.12.
One important measure of a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. McClain Bank's most recent annualized quarterly return on equity was 11.44 percent, above the national average of 8.10 percent.
The bank earned net income of $2.6 million on total equity of $23.6 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 1.27 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.