How profitable a bank is has an effect on its safety and soundness. Earnings may be retained by the bank, boosting its capital cushion, or be used to deal with problematic loans, likely making the bank better able to withstand economic trouble. However, banks that are losing money are less able to do those things.
Walcott Trust and Savings Bank fell short of the national average on Bankrate's test of earnings, achieving a score of 10 out of a possible 30.
One key way to measure a bank's earnings is return on equity, or net income (essentially profit) divided by total equity. Walcott Trust and Savings Bank's most recent annualized quarterly return on equity was 4.61 percent, below the national average of 8.10 percent.
The bank recorded net income of $943,000 on total equity of $20.8 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.75 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.