A bank's ability to earn money affects its safety and soundness. A bank can retain its earnings, expanding its capital cushion, or use them to address problematic loans, likely making the bank better prepared to withstand financial trouble. Losses, on the other hand, reduce a bank's ability to do those things.
Peoples Savings Bank did above-average on Bankrate's earnings test, achieving a score of 20 out of a possible 30.
One key way to measure a bank's earnings is return on equity, or net income (essentially profit) divided by total equity. Peoples Savings Bank's most recent annualized quarterly return on equity was 10.68 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $360,000 on total equity of $3.4 million. The bank experienced an annualized return on average assets, or ROA, of 1.01 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.