A bank's profitability has an effect on its safety and soundness. Earnings may be retained by the bank, boosting its capital buffer, or be used to address problematic loans, likely making the bank more resilient in tough times. Conversely, losses diminish a bank's ability to do those things.
On Bankrate's earnings test, Vantage Bank of Alabama scored 18 out of a possible 30, beating out the national average of 15.12.
Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important way to measure a bank's earnings. Vantage Bank of Alabama's most recent annualized quarterly return on equity was 8.47 percent, above the national average of 8.10 percent.
The bank earned net income of $1.3 million on total equity of $16.0 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 1.13 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.