A bank's earnings performance has an effect on its long-term survivability. Earnings can be retained by the bank, boosting its capital cushion, or be used to deal with problematic loans, likely making the bank better able to withstand financial shocks. However, banks that are losing money are less able to do those things.
State Bank of Texas outperformed the average on Bankrate's test of earnings, achieving a score of 30 out of a possible 30.
One important measure of a bank's earnings is return on equity, or net income (essentially profit) divided by the total amount of equity. State Bank of Texas's most recent annualized quarterly return on equity was 45.65 percent, above the national average of 8.10 percent.
The bank reported net income of $70.3 million on total equity of $150.3 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 8.33 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.