Arkansas Banks Lead Way in Regional ROA, ROE Rankings

In the third quarter of 2014, the average return on assets (ROA) for Arkansas banks was 1.27 percent, the top performer among the seven states in the U.S. Federal Reserve Bank’s Eighth District.

The percentage represents an increase of 0.02 percent in the state’s collective ROA from the third quarter of 2013.

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 also ahead of the Eighth District average of 1.1 percent and the national average of 1.02 percent.

For the same quarter, Grand Savings Bank of Grove, Oklahoma, had a 0.86 percent ROA, Simmons First National Bank of Pine Bluff had a 0.79 percent ROA and Huntsville-chartered Today’s Bank had an ROA of 2.35 percent.

In the category of return of average equity, or ROE, Arkansas banks also rank first at 10.71 percent in the third quarter of 2014. That represents a decrease of 0.04 percent from the third quarter of 2014.

Arkansas is one of three states in the Eighth District with an ROE of at least 10 percent.

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 third quarter of 2014 was 9.82 percent.

Among Arkansas banks, Chambers Bank of Danville had an ROE of 4.99 percent in the third quarter of 2014, Hampton-chartered First Bank showed an ROE of 9.89 percent, and Arvest Bank of Fayetteville had an ROE of 7.16 percent.