How profitable a bank is has an effect on its safety and soundness. Earnings may be retained by the bank, boosting its capital buffer, or be used to address problematic loans, likely making the bank better prepared to withstand economic trouble. Losses, on the other hand, reduce a bank's ability to do those things.
Sabine State Bank and Trust Company outperformed the average on Bankrate's earnings test, achieving a score of 24 out of a possible 30.
One widely used way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. The most recent annualized quarterly return on equity for Sabine State Bank and Trust Company was 15.65 percent, above the national average of 8.10 percent.
The bank reported net income of $13.3 million on total equity of $86.2 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 1.54 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.