How profitable a bank is affects its safety and soundness. A bank can retain its earnings, boosting its capital cushion, or use them to deal with problematic loans, likely making the bank more resilient in times of trouble. Losses, on the other hand, diminish a bank's ability to do those things.
On Bankrate's earnings test, The Port Austin State Bank scored 16 out of a possible 30, beating out the national average of 15.12.
Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one important way to measure a bank's earnings. The Port Austin State Bank's most recent annualized quarterly return on equity was 7.37 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $657,000 on total equity of $9.0 million. The bank experienced an annualized return on average assets, or ROA, of 1.28 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.