How profitable a bank is affects its long-term survivability. A bank can retain its earnings, expanding its capital cushion, or use them to address problematic loans, likely making the bank better prepared to withstand economic trouble. Banks that are losing money, however, are less able to do those things.
Texas Hill Country Bank scored 18 out of a possible 30 on Bankrate's earnings test, beating the national average of 15.12.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one key measure of a bank's earnings. Texas Hill Country Bank's most recent annualized quarterly return on equity was 9.14 percent, above the national average of 8.10 percent.
The bank reported net income of $1.1 million on total equity of $12.9 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 1.06 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.