How profitable a bank is has an effect on its safety and soundness. 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 better able to withstand economic trouble. Losses, on the other hand, diminish a bank's ability to do those things.
State Bank of Burrton scored 2 out of a possible 30 on Bankrate's earnings test, falling short of 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 (essentially profit) by total equity. The most recent annualized quarterly return on equity for State Bank of Burrton was 0.51 percent, below the national average of 8.10 percent.
The bank reported net income of $6,000 on total equity of $1.1 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.06 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.