A bank's ability to earn money affects its safety and soundness. Earnings can be retained by the bank, increasing its capital buffer, or be used to deal with 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.
Oakstar Bank scored 16 out of a possible 30 on Bankrate's test of earnings, above the national average of 15.12.
One important way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. The most recent annualized quarterly return on equity for Oakstar Bank was 7.68 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $5.4 million on total equity of $72.8 million. The bank experienced an annualized return on average assets, or ROA, of 0.78 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.