How profitable a bank is affects its long-term survivability. Earnings can be retained by the bank, increasing its capital buffer, or be used to address problematic loans, likely making the bank better able to withstand economic trouble. Conversely, losses diminish a bank's ability to do those things.
On Bankrate's earnings test, Wells Federal Bank scored 20 out of a possible 30, above the national average of 16.52.
One widely used measure of a bank's earnings is return on equity, calculated by dividing net income (essentially profit) by the total amount of equity. The most recent annualized quarterly return on equity for Wells Federal Bank was 10.86 percent, above the national average of 9.28 percent.
For the twelve months ended June 30, 2017, the bank recorded net income of $1.4 million on total equity of $25.6 million. The bank reported an annualized return on average assets, or ROA, of 1.06 percent, above the 1 percent deemed satisfactory in accordance with industry standards, but below the average for U.S. banks of 1.14 percent.