A bank's profitability affects its safety and soundness. A bank can retain its earnings, increasing its capital buffer, or use them to deal with problematic loans, likely making the bank more resilient in times of trouble. Obviously, banks that are losing money have less ability to do those things.
On Bankrate's test of earnings, The Milford Bank scored 0 out of a possible 30, lower than the national average of 15.12.
One widely used way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by the total amount of equity. The most recent annualized quarterly return on equity for The Milford Bank was -1.13 percent, below the national average of 8.10 percent.
The bank recorded net income of $-500,000 on total equity of $43.7 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of -0.12 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.