How profitable a bank is has an effect on its long-term survivability. A bank can retain its earnings, increasing its capital buffer, or put them to work addressing problematic loans, likely making the bank better prepared to withstand financial shocks. Obviously, banks that are losing money are less able to do those things.
Terre Haute Savings Bank received below-average marks on Bankrate's test of earnings, achieving a score of 6 out of a possible 30.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important way to measure a bank's earnings. Terre Haute Savings Bank's most recent annualized quarterly return on equity was 2.98 percent, below the national average of 8.10 percent.
The bank earned net income of $880,000 on total equity of $30.1 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.27 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.