How profitable a bank is has an effect on its safety and soundness. A bank can retain its earnings, increasing its capital cushion, or use them to deal with problematic loans, likely making the bank better able to withstand financial trouble. However, banks that are losing money have less ability to do those things.
The Farmers Bank of Liberty scored 18 out of a possible 30 on Bankrate's earnings test, exceeding the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for The Farmers Bank of Liberty was 8.97 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $929,000 on total equity of $10.8 million. The bank experienced an annualized return on average assets, or ROA, of 1.03 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.