How profitable a bank is affects its safety and soundness. A bank can retain its earnings, giving a boost to its capital buffer, or use them to address problematic loans, potentially making the bank more resilient in times of trouble. Banks that are losing money, however, are less able to do those things.
Touchstone Bank fell short of the national average on Bankrate's earnings test, achieving a score of 8 out of a possible 30.
One key measure of a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. Touchstone Bank's most recent annualized quarterly return on equity was 4.46 percent, below the national average of 8.10 percent.
The bank recorded net income of $1.3 million on total equity of $44.1 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.49 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.