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 buffer, or be used to deal with 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.
StonehamBank, A Co-operative Bank did below-average on Bankrate's earnings test, achieving a score of 14 out of a possible 30.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by the total amount of equity. StonehamBank, A Co-operative Bank's most recent annualized quarterly return on equity was 6.57 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $3.5 million on total equity of $55.5 million. The bank had an annualized return on average assets, or ROA, of 0.59 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.