A bank's ability to earn money affects its long-term survivability. A bank can retain its earnings, boosting its capital cushion, or put them to work addressing problematic loans, potentially making the bank more resilient in tough times. Obviously, banks that are losing money have less ability to do those things.
On Bankrate's earnings test, The First National Bank of Lawrence County at Walnut Ridge scored 20 out of a possible 30, beating the national average of 15.12.
Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for The First National Bank of Lawrence County at Walnut Ridge was 11.34 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $2.3 million on total equity of $21.3 million. The bank reported an annualized return on average assets, or ROA, of 1.15 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.