A bank's profitability has an effect on its safety and soundness. Earnings can be retained by the bank, boosting its capital buffer, or be used to deal with problematic loans, likely making the bank better prepared to withstand economic trouble. Banks that are losing money, however, are less able to do those things.
The First National Bank of Okawville scored 14 out of a possible 30 on Bankrate's earnings test, coming in below the national average of 15.12.
One widely used measure of a bank's earnings is return on equity, or net income (profit, basically) divided by total equity. The First National Bank of Okawville's most recent annualized quarterly return on equity was 6.67 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $471,000 on total equity of $7.2 million. The bank experienced an annualized return on average assets, or ROA, of 0.74 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.