How profitable a bank is has an effect on its long-term survivability. Earnings can be retained by the bank, boosting its capital buffer, or be used to deal with problematic loans, potentially making the bank more resilient in tough times. However, banks that are losing money have less ability to do those things.
The First National Bank of Hutchinson beat the national average on Bankrate's test of earnings, achieving a score of 16 out of a possible 30.
One widely used way to measure a bank's earnings is return on equity, or net income (profit, basically) divided by total equity. The First National Bank of Hutchinson's most recent annualized quarterly return on equity was 7.05 percent, below the national average of 8.10 percent.
The bank reported net income of $5.8 million on total equity of $83.0 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.82 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.