How profitable a bank is affects its safety and soundness. Earnings may be retained by the bank, expanding its capital cushion, or be used to deal with problematic loans, likely making the bank better prepared to withstand financial trouble. Losses, on the other hand, lessen a bank's ability to do those things.
Putnam Bank scored 8 out of a possible 30 on Bankrate's test of earnings, falling short of 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. Putnam Bank's most recent annualized quarterly return on equity was 3.76 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $2.6 million on total equity of $69.1 million. The bank experienced an annualized return on average assets, or ROA, of 0.50 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.