How profitable a bank is has an effect on its safety and soundness. Earnings can be retained by the bank, giving a boost to its capital buffer, or be used to deal with problematic loans, likely making the bank more resilient in times of trouble. Banks that are losing money, however, have less ability to do those things.
The First National Bank of Fort Smith beat the national average on Bankrate's test of earnings, achieving a score of 22 out of a possible 30.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one important way to measure a bank's earnings. The First National Bank of Fort Smith's most recent annualized quarterly return on equity was 13.54 percent, above the national average of 8.10 percent.
The bank reported net income of $21.9 million on total equity of $161.7 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 1.71 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.