A bank's ability to earn money has an effect on its safety and soundness. Earnings can be retained by the bank, expanding its capital cushion, or be used to address problematic loans, likely making the bank more resilient in tough times. However, banks that are losing money have less ability to do those things.
The Peoples Bank outperformed the average on Bankrate's test of earnings, achieving a score of 18 out of a possible 30.
One key measure of a bank's earnings is return on equity, or net income (profit, essentially) divided by the total amount of equity. The most recent annualized quarterly return on equity for The Peoples Bank was 9.78 percent, above the national average of 8.10 percent.
The bank reported net income of $3.2 million on total equity of $33.4 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 1.05 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.