Arkansas banks top regional ROA rankings

by Paul Gatling (pgatling@nwabj.com) 67 views 

In the second quarter of 2016, the average return on assets (ROA) for Arkansas banks was 1.28%, making it the top performer among the seven states that make up the U.S. Federal Reserve Bank’s Eighth District.

The percentage represents an increase of 0.8% in the state’s collective ROA from the second quarter of 2015.

ROA, as defined by the Federal Deposit Insurance Corp., is “net income after taxes and extraordinary items [annualized] as a percent of average assets.”

Banks generally consider their annual ROA percentage a top indicator of their health and profitability.

Arkansas banks are well ahead of the Eighth District average of 1.10% and the national average of 0.99%.

For the same quarter, Fayetteville-chartered Arvest Bank had an ROA of 0.48%, Bear State Bank N.A. of Little Rock had an ROA of 0.91% and Huntsville-based Today’s Bank had an ROA of 1.88%.

In the category of return on average equity, or ROE, Arkansas banks rank second at 10.22% in the second quarter of 2016. That represents an increase of 0.33% from the second quarter of 2015.

Arkansas is one of the three states in the Eighth District with an ROE of at least 10%, along with Kentucky (10.47%) and Missouri (10.12%).

ROE, as defined by the FDIC, is “annualized net income as a percent of average equity on a consolidated basis.”

The Eighth District ROE average in the second quarter of 2016 was 9.65%.

Among Arkansas banks, Booneville-based First Western Bank had an ROE of 7.52%, Priority Bank of Fayetteville had an ROE of 20.03% and Legacy National Bank of Springdale had an ROE of 7.59%.

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