A bank's ability to earn money has an effect on its safety and soundness. A bank can retain its earnings, expanding its capital buffer, or put them to work addressing problematic loans, potentially making the bank better prepared to withstand financial shocks. Losses, on the other hand, reduce a bank's ability to do those things.
On Bankrate's earnings test, The Peoples Savings Bank scored 14 out of a possible 30, below the national average of 15.12.
One widely used measure of a bank's earnings is return on equity, or net income (essentially profit) divided by the total amount of equity. The most recent annualized quarterly return on equity for The Peoples Savings Bank was 6.83 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank earned net income of $499,000 on total equity of $7.4 million. The bank had an annualized return on average assets, or ROA, of 0.83 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.