How profitable a bank is affects its safety and soundness. Earnings can be retained by the bank, giving a boost to its capital cushion, or be used to deal with problematic loans, likely making the bank better able to withstand economic trouble. However, banks that are losing money are less able to do those things.
The First National Bank fell behind the national average on Bankrate's earnings test, achieving a score of 12 out of a possible 30.
Return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity, is one important way to measure a bank's earnings. The First National Bank's most recent annualized quarterly return on equity was 5.45 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $406,000 on total equity of $7.5 million. The bank reported an annualized return on average assets, or ROA, of 0.46 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.