A bank's ability to earn money has an effect on its long-term survivability. Earnings can be retained by the bank, giving a boost to its capital buffer, or be used to deal with problematic loans, potentially making the bank better able to withstand financial trouble. Losses, on the other hand, take away from a bank's ability to do those things.
On Bankrate's test of earnings, State Bank of Arcadia scored 14 out of a possible 30, less than the national average of 15.12.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (essentially profit) by the total amount of equity. The most recent annualized quarterly return on equity for State Bank of Arcadia was 6.37 percent, below the national average of 8.10 percent.
The bank reported net income of $1.3 million on total equity of $20.6 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 0.76 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.