A bank's profitability has an effect on its safety and soundness. A bank can retain its earnings, increasing its capital buffer, or put them to work addressing problematic loans, likely making the bank more resilient in times of trouble. Banks that are losing money, however, have less ability to do those things.
Open Bank beat the national average on Bankrate's earnings test, achieving a score of 20 out of a possible 30.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one key measure of a bank's earnings. Open Bank's most recent annualized quarterly return on equity was 10.70 percent, above the national average of 8.10 percent.
The bank recorded net income of $9.3 million on total equity of $91.4 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 1.11 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.