How profitable a bank is affects its safety and soundness. Earnings may be retained by the bank, expanding its capital buffer, or be used to deal with problematic loans, likely making the bank better prepared to withstand economic trouble. However, banks that are losing money are less able to do those things.
On Bankrate's earnings test, WaterStone Bank, SSB scored 14 out of a possible 30, coming in below the national average of 15.12.
One key measure of a bank's earnings is return on equity, or net income (profit, essentially) divided by the total amount of equity. The most recent annualized quarterly return on equity for WaterStone Bank, SSB was 6.79 percent, below the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank reported net income of $25.9 million on total equity of $386.8 million. The bank had an annualized return on average assets, or ROA, of 1.43 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.