A bank's ability to earn money affects its long-term survivability. Earnings can be retained by the bank, increasing its capital cushion, or be used to deal with problematic loans, potentially making the bank better able to withstand financial trouble. Conversely, losses reduce a bank's ability to do those things.
The First National Bank of Bagley did above-average on Bankrate's earnings test, achieving a score of 18 out of a possible 30.
One important measure of a bank's earnings is return on equity, or net income (profit, essentially) divided by the total amount of equity. The First National Bank of Bagley's most recent annualized quarterly return on equity was 9.82 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $659,000 on total equity of $6.7 million. The bank reported an annualized return on average assets, or ROA, of 0.78 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.