How profitable a bank is affects its safety and soundness. A bank can retain its earnings, boosting its capital buffer, or put them to work addressing problematic loans, potentially making the bank better able to withstand economic shocks. Banks that are losing money, however, are less able to do those things.
State Bank of Lismore scored 24 out of a possible 30 on Bankrate's earnings test, beating out the national average of 15.12.
One key measure of a bank's earnings is return on equity, or net income (profit, essentially) divided by total equity. State Bank of Lismore's most recent annualized quarterly return on equity was 14.69 percent, above the national average of 8.10 percent.
The bank reported net income of $859,000 on total equity of $6.0 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 1.49 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.