A bank's profitability affects its long-term survivability. A bank can retain its earnings, increasing its capital buffer, or put them to work addressing problematic loans, potentially making the bank better prepared to withstand economic shocks. However, banks that are losing money have less ability to do those things.
On Bankrate's test of earnings, Merrick Bank scored 20 out of a possible 30, better than the national average of 15.12.
One widely used way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity. Merrick Bank's most recent annualized quarterly return on equity was 10.50 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $66.4 million on total equity of $630.2 million. The bank experienced an annualized return on average assets, or ROA, of 2.09 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.