How profitable a bank is has an effect on its safety and soundness. A bank can retain its earnings, expanding its capital cushion, or put them to work addressing problematic loans, likely making the bank better prepared to withstand economic shocks. Conversely, losses diminish a bank's ability to do those things.
On Bankrate's test of earnings, The First National Bank of Brownstown scored 12 out of a possible 30, less than the national average of 15.12.
One widely used measure of a bank's earnings is return on equity, calculated by dividing net income (essentially profit) by total equity. The First National Bank of Brownstown's most recent annualized quarterly return on equity was 5.49 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $218,000 on total equity of $4.0 million. The bank reported an annualized return on average assets, or ROA, of 0.59 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.