A bank's profitability affects its safety and soundness. Earnings can be retained by the bank, boosting its capital cushion, or be used to deal with problematic loans, potentially making the bank better able to withstand financial shocks. However, banks that are losing money have less ability to do those things.
The City State Bank did above-average on Bankrate's earnings test, achieving a score of 22 out of a possible 30.
One widely used measure of a bank's earnings is return on equity, or net income (essentially profit) divided by total equity. The most recent annualized quarterly return on equity for The City State Bank was 13.65 percent, above the national average of 8.10 percent.
The bank reported net income of $485,000 on total equity of $3.6 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 1.17 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.