How profitable a bank is has an effect on its safety and soundness. Earnings can be retained by the bank, increasing its capital cushion, or be used to address problematic loans, potentially making the bank more resilient in tough times. Losses, on the other hand, lessen a bank's ability to do those things.
Peoples Federal Savings and Loan Association fell short of the national average on Bankrate's earnings test, achieving a score of 10 out of a possible 30.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one important way to measure a bank's earnings. Peoples Federal Savings and Loan Association's most recent annualized quarterly return on equity was 3.98 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $591,000 on total equity of $14.6 million. The bank experienced an annualized return on average assets, or ROA, of 0.54 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.