A bank's ability to earn money 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, likely making the bank more resilient in times of trouble. Banks that are losing money, however, have less ability to do those things.
On Bankrate's earnings test, Rayne Building and Loan Association scored 6 out of a possible 30, less than the national average of 15.12.
One important measure of a bank's earnings is return on equity, or net income (essentially profit) divided by the total amount of equity. The most recent annualized quarterly return on equity for Rayne Building and Loan Association was 2.12 percent, below the national average of 8.10 percent.
The bank recorded net income of $309,000 on total equity of $14.7 million for the twelve months ended December 31, 2017. The bank had 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.