A bank's profitability has an effect on its long-term survivability. Earnings can be retained by the bank, giving a boost to its capital cushion, or be used to address problematic loans, likely making the bank more resilient in times of trouble. Losses, on the other hand, diminish a bank's ability to do those things.
River City Bank scored 18 out of a possible 30 on Bankrate's earnings test, beating out the national average of 15.12.
One widely used way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. River City Bank's most recent annualized quarterly return on equity was 9.32 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $16.7 million on total equity of $184.9 million. The bank reported an annualized return on average assets, or ROA, of 0.86 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.