A bank's ability to earn money affects its safety and soundness. A bank can retain its earnings, expanding its capital cushion, or use them to deal with problematic loans, likely making the bank better able to withstand economic trouble. However, banks that are losing money are less able to do those things.
The Farmers Bank of Osborne scored 20 out of a possible 30 on Bankrate's test of earnings, above the national average of 15.12.
Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one key measure of a bank's earnings. The most recent annualized quarterly return on equity for The Farmers Bank of Osborne was 11.40 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $797,000 on total equity of $7.2 million. The bank had an annualized return on average assets, or ROA, of 1.28 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.