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 address problematic loans, likely making the bank more resilient in times of trouble. However, banks that are losing money have less ability to do those things.
North Adams State Bank fell behind the national average on Bankrate's earnings test, achieving a score of 10 out of a possible 30.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one key measure of a bank's earnings. North Adams State Bank's most recent annualized quarterly return on equity was 4.80 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $240,000 on total equity of $5.1 million. The bank experienced an annualized return on average assets, or ROA, of 0.69 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.