How profitable a bank is affects its long-term survivability. A bank can retain its earnings, increasing its capital cushion, or use them to address problematic loans, potentially making the bank more resilient in tough times. Losses, on the other hand, reduce a bank's ability to do those things.
The Citizens Bank of Valley Head scored 6 out of a possible 30 on Bankrate's test of earnings, less than the national average of 15.12.
One key way to measure a bank's earnings is return on equity, or net income (profit, essentially) divided by the total amount of equity. The most recent annualized quarterly return on equity for The Citizens Bank of Valley Head was 2.98 percent, below the national average of 8.10 percent.
The bank earned net income of $94,000 on total equity of $3.2 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.35 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.