Arkansas banks top regional ROA rankings in third quarter

by Paul Gatling (pgatling@nwabj.com) 461 views 

In the third quarter of 2019, the average return on assets (ROA) for Arkansas banks was 1.49%, ranking the state’s lenders as the top performers among the seven states that make up the U.S. Federal Reserve Bank’s Eighth District. The state’s collective ROA was down, however, 0.12% from the third quarter of 2018.

A bank’s ROA is a popular metric used to determine a bank’s profitability. As defined by the Federal Deposit Insurance Corp. (FDIC), it shows the percentage of how profitable a company’s assets are in generating revenue. The higher the ROA, the more money the company is earning on its assets.

Arkansas banks are ahead of the Eighth District average of 1.36% and the national average of 1.33%.

For the same quarter, which ended Sept. 30, the best year-to-date ROA among Arkansas banks belonged to Conway-chartered Centennial Bank at 2.73%. First National Bank of Paragould had an ROA of 1.58% and Anstaff Bank in Green Forest had an ROA of 1.44%.

In the category of return on average equity, or ROE, Arkansas banks ranked third at 10.22% in the third quarter of 2019. That represents a decrease of 1.41% from the third quarter of 2018.

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

Missouri is the top-performing state in the Eighth District in the category, with an ROE in the third quarter of 13.22%. That represents a decrease of 0.03% from the third quarter of 2018.

Among Arkansas banks, Bank of Gravette had an ROE of 2.36%, Danville-based Chambers Bank had an ROE of 13.25% and Booneville-based First Western Bank had an ROE of 9.40%

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