A bank's profitability affects its long-term survivability. A bank can retain its earnings, giving a boost to its capital buffer, or use them to address problematic loans, likely making the bank better able to withstand financial trouble. Losses, on the other hand, reduce a bank's ability to do those things.
Texico State Bank fell short of the national average on Bankrate's test of earnings, achieving a score of 2 out of a possible 30.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one widely used measure of a bank's earnings. The most recent annualized quarterly return on equity for Texico State Bank was 0.58 percent, below the national average of 8.10 percent.
The bank reported net income of $4,000 on total equity of $687,000 for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.05 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.