A bank's earnings performance affects its safety and soundness. Earnings can be retained by the bank, expanding its capital buffer, or be used to address problematic loans, potentially making the bank more resilient in times of trouble. Obviously, banks that are losing money have less ability to do those things.
On Bankrate's test of earnings, The Citizens National Bank of Park Rapids scored 22 out of a possible 30, beating the national average of 15.12.
Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one important way to measure a bank's earnings. The Citizens National Bank of Park Rapids's most recent annualized quarterly return on equity was 13.95 percent, above the national average of 8.10 percent.
The bank recorded net income of $3.6 million on total equity of $27.0 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 1.45 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.