A bank's profitability has an effect on its safety and soundness. A bank can retain its earnings, expanding its capital buffer, or put them to work addressing problematic loans, likely making the bank more resilient in times of trouble. Banks that are losing money, however, are less able to do those things.
The Bank of South Carolina scored 20 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 total equity, is one widely used measure of a bank's earnings. The Bank of South Carolina's most recent annualized quarterly return on equity was 12.11 percent, above the national average of 8.10 percent.
The bank recorded net income of $5.1 million on total equity of $42.4 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 1.18 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.