A bank's profitability affects its safety and soundness. Earnings may be retained by the bank, increasing its capital cushion, or be used to address problematic loans, likely making the bank more resilient in times of trouble. Losses, on the other hand, diminish a bank's ability to do those things.
Waumandee State Bank scored 18 out of a possible 30 on Bankrate's test of earnings, better than the national average of 15.12.
One widely used way to measure a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. Waumandee State Bank's most recent annualized quarterly return on equity was 8.64 percent, above the national average of 8.10 percent.
For the twelve months ended December 31, 2017, the bank recorded net income of $1.5 million on total equity of $18.2 million. The bank had an annualized return on average assets, or ROA, of 0.87 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.00 percent.