How profitable a bank is has an effect on its safety and soundness. Earnings may be retained by the bank, boosting its capital cushion, or be used to deal with problematic loans, likely making the bank more resilient in tough times. However, banks that are losing money are less able to do those things.
Medallion Bank fell behind the national average on Bankrate's test of earnings, achieving a score of 6 out of a possible 30.
One key way to measure a bank's earnings is return on equity, or net income (profit, essentially) divided by the total amount of equity. Medallion Bank's most recent annualized quarterly return on equity was 2.74 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $4.6 million on total equity of $164.2 million. The bank reported an annualized return on average assets, or ROA, of 0.42 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.