How profitable a bank is has an effect on its long-term survivability. A bank can retain its earnings, increasing its capital cushion, or use them to deal with problematic loans, likely making the bank more resilient in tough times. Obviously, banks that are losing money are less able to do those things.
On Bankrate's test of earnings, State Bank of Davis scored 20 out of a possible 30, better than the national average of 15.12.
One key way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. State Bank of Davis's most recent annualized quarterly return on equity was 12.19 percent, above the national average of 8.10 percent.
The bank reported net income of $1.9 million on total equity of $16.2 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 1.21 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.