A bank's ability to earn money affects its safety and soundness. A bank can retain its earnings, giving a boost to its capital cushion, or use them to deal with problematic loans, potentially making the bank better able to withstand economic trouble. Obviously, banks that are losing money have less ability to do those things.
The Farmers Bank and Savings Company beat the national average on Bankrate's earnings test, achieving a score of 16 out of a possible 30.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one important measure of a bank's earnings. The Farmers Bank and Savings Company's most recent annualized quarterly return on equity was 7.54 percent, below the national average of 8.10 percent.
The bank reported net income of $2.3 million on total equity of $31.2 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 0.80 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.