How profitable a bank is has an effect on its long-term survivability. A bank can retain its earnings, expanding its capital buffer, or put them to work addressing problematic loans, potentially making the bank more resilient in tough times. Banks that are losing money, however, are less able to do those things.
On Bankrate's earnings test, United Bank of Michigan scored 18 out of a possible 30, better 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 important way to measure a bank's earnings. United Bank of Michigan's most recent annualized quarterly return on equity was 8.28 percent, above the national average of 8.10 percent.
The bank recorded net income of $4.8 million on total equity of $60.1 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.77 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.