How profitable a bank is affects its safety and soundness. A bank can retain its earnings, boosting its capital buffer, or use them to address problematic loans, potentially making the bank better able to withstand financial shocks. Conversely, losses reduce a bank's ability to do those things.
The National Grand Bank of Marblehead exceeded the national average on Bankrate's earnings test, achieving a score of 20 out of a possible 30.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one widely used measure of a bank's earnings. The National Grand Bank of Marblehead's most recent annualized quarterly return on equity was 10.44 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $3.7 million on total equity of $36.6 million. The bank had an annualized return on average assets, or ROA, of 1.17 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.