A bank's earnings performance affects its safety and soundness. Earnings may be retained by the bank, expanding its capital cushion, or be used to address problematic loans, potentially making the bank better able to withstand economic trouble. Losses, on the other hand, lessen a bank's ability to do those things.
On Bankrate's test of earnings, PeoplesSouth Bank scored 18 out of a possible 30, better than the national average of 15.12.
One widely used way to measure a bank's earnings is return on equity, or net income (profit, essentially) divided by total equity. The most recent annualized quarterly return on equity for PeoplesSouth Bank was 8.46 percent, above the national average of 8.10 percent.
The bank earned net income of $5.7 million on total equity of $69.3 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.79 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.