How profitable a bank is has an effect on its long-term survivability. Earnings may be retained by the bank, boosting its capital buffer, or be used to address problematic loans, likely making the bank more resilient in times of trouble. Conversely, losses diminish a bank's ability to do those things.
PennCrest Bank scored 4 out of a possible 30 on Bankrate's earnings test, failing to reach the national average of 15.12.
One widely used measure of a bank's earnings is return on equity, or net income (essentially profit) divided by the total amount of equity. PennCrest Bank's most recent annualized quarterly return on equity was 1.90 percent, below the national average of 8.10 percent.
The bank reported net income of $523,000 on total equity of $27.5 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.30 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.