How profitable a bank is affects its long-term survivability. A bank can retain its earnings, expanding its capital cushion, or put them to work addressing problematic loans, likely making the bank better prepared to withstand financial shocks. Obviously, banks that are losing money are less able to do those things.
On Bankrate's earnings test, The Lowell Five Cent Savings Bank scored 18 out of a possible 30, beating the national average of 15.12.
One key way to measure a bank's earnings is return on equity, calculated by dividing net income (essentially profit) by the total amount of equity. The most recent annualized quarterly return on equity for The Lowell Five Cent Savings Bank was 8.36 percent, above the national average of 8.10 percent.
The bank earned net income of $10.8 million on total equity of $131.9 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.98 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.