How profitable a bank is has an effect on its long-term survivability. Earnings may be retained by the bank, increasing its capital buffer, or be used to deal with problematic loans, likely making the bank more resilient in times of trouble. However, banks that are losing money are less able to do those things.
On Bankrate's test of earnings, Reliance Bank scored 4 out of a possible 30, below the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one widely used measure of a bank's earnings. The most recent annualized quarterly return on equity for Reliance Bank was 1.87 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $3.0 million on total equity of $157.1 million. The bank had an annualized return on average assets, or ROA, of 0.22 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.