How profitable a bank is affects its long-term survivability. Earnings may be retained by the bank, boosting its capital cushion, or be used to address problematic loans, potentially making the bank more resilient in times of trouble. Banks that are losing money, however, have less ability to do those things.
The First State Bank scored 24 out of a possible 30 on Bankrate's earnings test, beating out the national average of 15.12.
Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one important measure of a bank's earnings. The most recent annualized quarterly return on equity for The First State Bank was 14.67 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $961,000 on total equity of $6.6 million. The bank experienced an annualized return on average assets, or ROA, of 1.30 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.