A bank's profitability affects its safety and soundness. Earnings may be retained by the bank, expanding its capital cushion, or be used to address problematic loans, potentially making the bank more resilient in tough times. However, banks that are losing money have less ability to do those things.
Texas Exchange Bank, ssb beat the national average on Bankrate's test of earnings, achieving a score of 24 out of a possible 30.
Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one key measure of a bank's earnings. Texas Exchange Bank, ssb's most recent annualized quarterly return on equity was 18.86 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $12.6 million on total equity of $80.4 million. The bank reported an annualized return on average assets, or ROA, of 1.55 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.