How profitable a bank is has an effect on its safety and soundness. A bank can retain its earnings, boosting its capital buffer, or put them to work addressing problematic loans, potentially making the bank better able to withstand economic trouble. Conversely, losses lessen a bank's ability to do those things.
Pacific Alliance Bank fell behind the national average on Bankrate's test of earnings, achieving a score of 12 out of a possible 30.
One widely used way to measure a bank's earnings is return on equity, or net income (profit, basically) divided by total equity. Pacific Alliance Bank's most recent annualized quarterly return on equity was 5.95 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $1.9 million on total equity of $33.0 million. The bank reported an annualized return on average assets, or ROA, of 0.72 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.