A bank's profitability has an effect on its safety and soundness. A bank can retain its earnings, giving a boost to its capital cushion, or put them to work addressing problematic loans, potentially making the bank better able to withstand economic shocks. Losses, on the other hand, diminish a bank's ability to do those things.
Peoples State Bank scored 16 out of a possible 30 on Bankrate's test of earnings, beating the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for Peoples State Bank was 7.39 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $637,000 on total equity of $8.6 million. The bank had an annualized return on average assets, or ROA, of 1.03 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.