A bank's profitability affects its safety and soundness. A bank can retain its earnings, expanding its capital cushion, or use them to address problematic loans, likely making the bank better prepared to withstand economic shocks. Obviously, banks that are losing money are less able to do those things.
Security State Bank received above-average marks on Bankrate's earnings test, achieving a score of 26 out of a possible 30.
Return on equity, calculated by dividing net income (profit, basically) by the total amount of equity, is one widely used measure of a bank's earnings. The most recent annualized quarterly return on equity for Security State Bank was 17.12 percent, above the national average of 8.10 percent.
The bank earned net income of $4.3 million on total equity of $24.3 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 2.44 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.