A bank's ability to earn money affects its safety and soundness. A bank can retain its earnings, expanding its capital buffer, or put them to work addressing problematic loans, potentially making the bank more resilient in times of trouble. Obviously, banks that are losing money have less ability to do those things.
Parkway Bank and Trust Company scored 16 out of a possible 30 on Bankrate's earnings test, better than the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by the total amount of equity, is one important way to measure a bank's earnings. Parkway Bank and Trust Company's most recent annualized quarterly return on equity was 7.42 percent, below the national average of 8.10 percent.
The bank earned net income of $19.5 million on total equity of $266.2 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.80 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.