A bank's profitability has an effect on its long-term survivability. Earnings can be retained by the bank, expanding its capital buffer, or be used to address problematic loans, potentially making the bank more resilient in times of trouble. Obviously, banks that are losing money are less able to do those things.
Teutopolis State Bank beat the national average on Bankrate's earnings test, achieving a score of 18 out of a possible 30.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. Teutopolis State Bank's most recent annualized quarterly return on equity was 8.70 percent, above the national average of 8.10 percent.
The bank recorded net income of $2.5 million on total equity of $29.1 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 1.14 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.