How profitable a bank is has an effect on its long-term survivability. Earnings can be retained by the bank, boosting its capital buffer, or be used to address problematic loans, likely making the bank better able to withstand financial shocks. However, banks that are losing money have less ability to do those things.
The Home National Bank of Thorntown beat the national average on Bankrate's earnings test, achieving a score of 16 out of a possible 30.
One widely used measure of a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. The most recent annualized quarterly return on equity for The Home National Bank of Thorntown was 7.32 percent, below the national average of 8.10 percent.
The bank reported net income of $680,000 on total equity of $9.5 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.65 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.