How profitable a bank is affects its long-term survivability. Earnings may be retained by the bank, increasing its capital cushion, or be used to address problematic loans, potentially making the bank better prepared to withstand economic shocks. Obviously, banks that are losing money are less able to do those things.
On Bankrate's earnings test, Umpqua Bank scored 12 out of a possible 30, less than the national average of 15.12.
Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one widely used measure of a bank's earnings. Umpqua Bank's most recent annualized quarterly return on equity was 6.02 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $255.6 million on total equity of $4.30 billion. The bank had an annualized return on average assets, or ROA, of 1.01 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.