How profitable a bank is has an effect on its safety and soundness. A bank can retain its earnings, expanding its capital buffer, or use them to address problematic loans, potentially making the bank more resilient in times of trouble. Conversely, losses take away from a bank's ability to do those things.
State Bank of Reeseville scored 14 out of a possible 30 on Bankrate's test of earnings, lower than the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one widely used measure of a bank's earnings. State Bank of Reeseville's most recent annualized quarterly return on equity was 7.25 percent, below the national average of 8.10 percent.
The bank reported net income of $624,000 on total equity of $9.0 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.83 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.