How profitable a bank is has an effect on its safety and soundness. A bank can retain its earnings, expanding its capital buffer, or use them to deal with problematic loans, likely making the bank more resilient in tough times. Banks that are losing money, however, have less ability to do those things.
The Village Bank received above-average marks on Bankrate's test of earnings, achieving a score of 20 out of a possible 30.
One important measure of a bank's earnings is return on equity, or net income (essentially profit) divided by total equity. The Village Bank's most recent annualized quarterly return on equity was 11.53 percent, above the national average of 8.10 percent.
The bank earned net income of $931,000 on total equity of $7.9 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 1.11 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.