A bank's earnings performance 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 more resilient in tough times. Conversely, losses take away from a bank's ability to do those things.
On Bankrate's test of earnings, Pinnacle Bank Sioux City scored 12 out of a possible 30, coming in below the national average of 15.12.
Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one important way to measure a bank's earnings. Pinnacle Bank Sioux City's most recent annualized quarterly return on equity was 5.20 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $567,000 on total equity of $11.0 million. The bank reported an annualized return on average assets, or ROA, of 0.65 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.