How profitable a bank is affects its long-term survivability. Earnings may be retained by the bank, increasing its capital buffer, or be used to deal with problematic loans, likely making the bank more resilient in tough times. Losses, on the other hand, reduce a bank's ability to do those things.
The Karnes County National Bank of Karnes City underperformed the average on Bankrate's earnings test, achieving a score of 6 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 the total amount of equity. The Karnes County National Bank of Karnes City's most recent annualized quarterly return on equity was 2.51 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $845,000 on total equity of $33.2 million. The bank reported an annualized return on average assets, or ROA, of 0.24 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.