A bank's profitability has an effect on its long-term survivability. A bank can retain its earnings, expanding its capital cushion, or put them to work addressing problematic loans, likely making the bank more resilient in tough times. Banks that are losing money, however, are less able to do those things.
The Bank of Steinauer fell behind the national average on Bankrate's test of earnings, achieving a score of 8 out of a possible 30.
Return on equity, calculated by dividing net income (profit, basically) by the total amount of equity, is one widely used measure of a bank's earnings. The Bank of Steinauer's most recent annualized quarterly return on equity was 3.80 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $43,000 on total equity of $1.1 million. The bank experienced an annualized return on average assets, or ROA, of 0.36 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.