A bank's ability to earn money 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, likely making the bank more resilient in times of trouble. However, banks that are losing money are less able to do those things.
On Bankrate's earnings test, Peoples Bank & Trust Company scored 20 out of a possible 30, beating out the national average of 15.12.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity. Peoples Bank & Trust Company's most recent annualized quarterly return on equity was 10.49 percent, above the national average of 8.10 percent.
The bank recorded net income of $794,000 on total equity of $7.8 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 1.40 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.