How profitable a bank is affects its long-term survivability. A bank can retain its earnings, giving a boost to its capital cushion, or use them to deal with problematic loans, potentially making the bank more resilient in tough times. Obviously, banks that are losing money are less able to do those things.
On Bankrate's earnings test, Parke Bank scored 18 out of a possible 30, better than the national average of 15.12.
One key way to measure a bank's earnings is return on equity, calculated by dividing net income (essentially profit) by total equity. The most recent annualized quarterly return on equity for Parke Bank was 8.67 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $12.5 million on total equity of $147.4 million. The bank reported an annualized return on average assets, or ROA, of 1.18 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.