A bank's ability to earn money has an effect on its safety and soundness. A bank can retain its earnings, giving a boost to its capital buffer, or put them to work addressing problematic loans, potentially making the bank more resilient in tough times. Losses, on the other hand, reduce a bank's ability to do those things.
On Bankrate's earnings test, WEX Bank scored 30 out of a possible 30, exceeding the national average of 15.12.
One important way to measure a bank's earnings is return on equity, or net income (profit, basically) divided by total equity. WEX Bank's most recent annualized quarterly return on equity was 75.32 percent, above the national average of 8.10 percent.
The bank reported net income of $212.7 million on total equity of $304.5 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 9.04 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 percent.