How profitable a bank is has an effect on its safety and soundness. Earnings may be retained by the bank, increasing its capital cushion, or be used to deal with problematic loans, potentially making the bank better able to withstand economic shocks. Losses, on the other hand, lessen a bank's ability to do those things.
On Bankrate's earnings test, Montecito Bank & Trust scored 22 out of a possible 30, beating the national average of 15.12.
Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one important way to measure a bank's earnings. Montecito Bank & Trust's most recent annualized quarterly return on equity was 12.46 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $17.5 million on total equity of $144.6 million. The bank reported an annualized return on average assets, or ROA, of 1.30 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.