How profitable a bank is affects its safety and soundness. A bank can retain its earnings, giving a boost to its capital cushion, or put them to work addressing problematic loans, likely making the bank more resilient in times of trouble. Conversely, losses lessen a bank's ability to do those things.
The Iuka State Bank received below-average marks on Bankrate's test of earnings, achieving a score of 14 out of a possible 30.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. The Iuka State Bank's most recent annualized quarterly return on equity was 7.05 percent, below the national average of 8.10 percent.
The bank reported net income of $561,000 on total equity of $8.4 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.63 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.