How profitable a bank is has an effect on its long-term survivability. Earnings may be retained by the bank, increasing its capital cushion, or be used to deal with problematic loans, potentially making the bank better prepared to withstand economic shocks. However, banks that are losing money have less ability to do those things.
On Bankrate's test of earnings, Territorial Savings Bank scored 16 out of a possible 30, above the national average of 15.12.
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. Territorial Savings Bank's most recent annualized quarterly return on equity was 7.31 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $15.6 million on total equity of $213.1 million. The bank reported an annualized return on average assets, or ROA, of 0.80 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.