How profitable a bank is has an effect on its safety and soundness. A bank can retain its earnings, giving a boost to its capital buffer, or use them to address problematic loans, likely making the bank more resilient in tough times. Conversely, losses lessen a bank's ability to do those things.
The Freedom Bank of Virginia received below-average marks on Bankrate's earnings test, achieving a score of 12 out of a possible 30.
One widely used way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity. The Freedom Bank of Virginia's most recent annualized quarterly return on equity was 5.31 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $2.9 million on total equity of $56.2 million. The bank reported an annualized return on average assets, or ROA, of 0.55 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.