A bank's ability to earn money has an effect on its safety and soundness. A bank can retain its earnings, giving a boost to its capital cushion, or put them to work addressing problematic loans, likely making the bank better prepared to withstand economic trouble. Losses, on the other hand, diminish a bank's ability to do those things.
The Blue Grass Valley Bank scored 6 out of a possible 30 on Bankrate's test of earnings, below the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one widely used measure of a bank's earnings. The Blue Grass Valley Bank's most recent annualized quarterly return on equity was 2.71 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $127,000 on total equity of $4.6 million. The bank experienced an annualized return on average assets, or ROA, of 0.29 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.