Summit Financial Group Reports First Quarter 2024 Earnings of $1.14 Per Share

MOOREFIELD, W.Va., April 25, 2024 (GLOBE NEWSWIRE) — Summit Financial Group, Inc. (“Company” or “Summit”) (NASDAQ: SMMF) today reported financial results for the first quarter of 2024, revealing a strong earnings performance marked by growth in loans. The Company’s continued success underscores its position as an exceptional community bank, reflecting a sound strategy and solid operational execution.

The Company, which serves commercial and individual clients across West Virginia, the Washington D.C. metropolitan area, Virginia, Kentucky, the Eastern Shore of Maryland and Delaware through Summit Community Bank, Inc., reported net income applicable to common shares of $16.8 million, or $1.14 per diluted share, for the first quarter of 2024, as compared to $16.4 million, or $1.11 per diluted share, for the fourth quarter of 2023 and $13.9 million, or $1.08 per diluted share, for the first quarter of 2023.

“We had a strong start to the year highlighted by solid earnings, a stable top quartile peer net interest margin, an enviable efficiency ratio and best-in-class return on tangible common equity” noted H. Charles Maddy, III, President and Chief Executive Officer. “Now as we look forward to the consummation of our strategic partnership with Burke & Herbert, which brings together two organizations dedicated to a community banking model that places an emphasis on service and dedication to the people who live and work among us, I could not be more excited by the combined organization’s prospects for robust growth and for enhancing shareholder value.”

Key Highlights for the First Quarter of 2024

  • Our pending merger of equals with Burke & Herbert Financial Services Corp. (“Burke & Herbert”) has received all required regulatory approvals or waivers and is expected to close May 3, 2024.
  • Tangible Book Value Per Common Share (“TBVPCS”) increased by $1.02 to $24.91 during the first quarter of 2024, representing a 4.3 percent increase. This increase was primarily due to net retained earnings.
  • Our net interest margin (“NIM”) decreased 1 basis point to 3.75 percent from the linked quarter.
  • The first quarter saw a modest increase in total loans, excluding mortgage warehouse lines of credit and acquired loans, registering an increase of 0.48 percent (1.93 percent annualized). This performance was further underscored by year-over-year growth of 6.7 percent.
  • Summit’s core deposits likewise experienced a modest increase in the first quarter of 2024, up 0.91 percent (3.63 percent annualized) from the linked quarter.
  • The Company recorded no provision for credit losses in the first quarter of 2024 compared to $1.50 million in the linked quarter.
  • Summit’s efficiency ratio was 48.29 percent compared to 47.33 percent in the linked quarter, indicating optimized use of resources.

Results from Operations

Net interest income totaled $39.9 million in the first quarter of 2024, an increase of 16.8 percent from the prior-year first quarter, and a decrease of 2.1 percent from the linked quarter. NIM for the first quarter 2024 was 3.75 percent compared to 3.76 percent for the linked quarter and 3.83 percent for the prior-year quarter.

Summit recorded no provision for credit losses in the first quarter of 2024 compared to $1.50 million in both the linked quarter and the year ago quarter.

Noninterest income, consisting primarily of service fee income from community banking activities and trust and wealth management fees, for first quarter 2024 was $5.08 million compared to $5.80 million for the linked quarter and $4.39 million for the comparable period of 2023. The Company recorded realized securities losses on available for sale debt securities of $94,000 in the first quarter of 2024 and gains of $15,000 in the linked quarter. In addition, the Company recognized net gains on equity investments of $40,000 in the first quarter 2024 compared to $365,000 in the linked quarter.

Total noninterest expense decreased to $23.0 million in the first quarter of 2024, down 4.0 percent from $23.9 million in the linked quarter and up 18.3 percent from $19.4 million for the prior-year first quarter.

Salary and benefit expenses of $12.1 million in the first quarter of 2024 increased from $11.4 million for the linked quarter and $10.8 million from the prior-year first quarter. The year over year increase was primarily due to the PSB acquisition and higher group health insurance premiums.

Acquisition-related expenses were $53,000 for Q1 2024 compared to $839,000 for the linked quarter and $331,000 for Q1 2023.

Other expenses were very controlled at $3.44 million for Q1 2024 compared to $4.35 million for the linked quarter and $2.97 million in the year-ago period.

Summit’s efficiency ratio was 48.29 percent in the first quarter of 2024, up from 48.00 percent for the first quarter of 2023 and marginally higher compared to 47.33 percent in the linked quarter. Non-interest expense to average assets was 1.99 percent in first quarter of 2024 compared to 2.05 percent in the linked quarter and 1.97 percent in the year-ago quarter.

Balance Sheet

As of March 31, 2024, total assets were $4.6 billion, an increase of $8.56 million, or 0.2 percent since December 31, 2023.

Total loans net of unearned fees increased 0.4 percent (1.7 percent annualized) to $3.70 billion as of March 31, 2024, from $3.68 billion at December 31, 2023. Total loans, excluding those related to mortgage warehouse lending and acquired loans, reached $3.2 billion as of March 31, 2024. This represents an increase of 0.48 percent (or 1.93 percent when annualized) during the quarter just ended.

Deposits totaled $3.7 billion on March 31, 2024, a 0.9 percent (or 3.6 percent annualized) increase during the first quarter. Core deposits increased 0.9 percent (3.6 percent annualized) during the first quarter 2024 to $3.7 billion. Adjusted uninsured deposits (excluding uninsured public deposits otherwise secured or collateralized as required by law) were 34.4 percent of total deposits at March 31, 2024 compared to 34.8 percent at year-end 2023 and 29.3 percent at the year-ago period end.

Total shareholders’ equity was $454.3 million as of March 31, 2024, compared to $440.2 million at December 31, 2023. Summit paid a quarterly common dividend of $0.22 per share in the first quarter of 2024.

During the first quarter 2024, TBVPCS increased $1.02 to $24.91. In addition to the positive impact of retained earnings, TBVPCS was positively impacted by unrealized net gains on interest rate caps and swaps held as hedges against higher interest rates totaling $0.20 per common share (net of deferred income taxes) recorded in accumulated other comprehensive loss. However, these gains were nearly offset by unrealized net losses on AFS debt securities of $0.18 per common share (net of deferred income taxes), also recorded in accumulated other comprehensive loss, in the same period.

Summit had 14,686,738 outstanding common shares at March 31, 2024, compared to 14,683,457 at year-end 2023.

Asset Quality

The Company recorded net loan recoveries of $93,000 during first quarter 2024 compared to net loan recoveries of $188,000 in the fourth quarter of 2023 and $63,000 in the year-ago period.

Summit recorded no provision for credit losses in the first quarter of 2024. The provision for credit losses was $1.50 million for both the linked quarter and the first quarter of 2023.

Summit’s allowance for loan credit losses was $49.2 million on March 31, 2024, $48.1 million at the end of the linked quarter, and $40.8 million on March 31, 2023.

The allowance for loan credit losses stood at 1.33 percent of total loans at March 31, 2024 compared to 1.31 percent at December 31, 2023. The allowance was 227.6 percent of nonperforming loans at March 31, 2024, compared to 388.2 percent at year-end 2023.

Summit’s allowance for credit losses on unfunded loan commitments was $6.69 million as of March 31, 2024, compared to $7.74 million at the end of the linked quarter. The allowance for credit losses on unfunded loan commitments decreased $1.05 million during the most recent quarter, principally as a result of a change in the mix of unfunded commitments. Construction loan commitments, which on average have a higher historical loss ratio than do other loans, decreased, while commercial unfunded lines of credit, which carry a lower loss factor and lower utilization rates, increased.

As of March 31, 2024, nonperforming assets (“NPAs”), consisting of nonperforming loans, foreclosed properties, and repossessed assets, totaled $25.1 million, or 0.54 percent of assets, compared to NPAs of $16.2 million, or 0.35 percent of assets at year-end 2023.

About the Company

Summit Financial Group, Inc. is the $4.6 billion financial holding company for Summit Community Bank, Inc. Its talented bankers serve commercial and individual clients throughout West Virginia, the Washington, D.C. metropolitan area, Virginia, Kentucky, Eastern Shore of Maryland and Delaware. Summit’s focus on in-market commercial lending and providing other business banking services in dynamic markets is designed to leverage its highly efficient operations and core deposits in strong legacy locations. Residential and consumer lending, trust and wealth management, and other retail financial services are offered through convenient digital and mobile banking platforms, including MySummitBank.com and 54 full-service branch locations. More information on Summit Financial Group, Inc. (NASDAQ: SMMF), headquartered in West Virginia’s Eastern Panhandle in Moorefield, is available at SummitFGI.com.

Non-GAAP Financial Measures

In addition to the results of operations presented in accordance with Generally Accepted Accounting Principles (GAAP), Summit’s management uses, and this press release contains or references, certain non-GAAP financial measures, such as tangible common equity/tangible assets; efficiency ratio; return on average tangible equity and return on average tangible common equity. Summit believes these financial measures provide information useful to investors in understanding our operational performance and business and performance trends which facilitate comparisons with the performance of others in the financial services industry. Although Summit believes that these non-GAAP financial measures enhance investors’ understanding of Summit’s business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP.

Forward-Looking Statements

This press release contains comments or information that constitute forward-looking statements (within the meaning of the Private Securities Litigation Act of 1995) that are based on current expectations that involve a number of risks and uncertainties. Words such as “expects”, “anticipates”, “believes”, “estimates” and other similar expressions or future or conditional verbs such as “will”, “should”, “would” and “could” are intended to identify such forward-looking statements.

Although we believe the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially. Factors that might cause such a difference include: the effect of the COVID-19 pandemic, including the negative impacts and disruptions on the communities we serve, and the domestic and global economy, which may have an adverse effect on our business; current and future economic and market conditions, including the effects of declines in housing prices, high unemployment rates, U.S. fiscal debt, budget and tax matters, geopolitical matters, and any slowdown in global economic growth; fiscal and monetary policies of the Federal Reserve; future provisions for credit losses on loans and debt securities; changes in nonperforming assets; changes in interest rates and interest rate relationships; demand for products and services; the degree of competition by traditional and non-traditional competitors; the successful integration of operations of our acquisitions; changes in banking laws and regulations; changes in tax laws; the impact of technological advances; the outcomes of contingencies; trends in customer behavior as well as their ability to repay loans; and changes in the national and local economies. We undertake no obligation to revise these statements following the date of this press release.

 
SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)    
Quarterly Performance Summary (unaudited)      
Q1 2024 vs Q1 2023      
       
    For the Quarter Ended Percent
Dollars in thousands 3/31/2024 3/31/2023 Change
Statements of Income      
  Interest income      
  Loans, including fees $ 59,249   $ 45,485   30.3 %
  Securities   6,141     4,819   27.4 %
  Other   132     171   -22.8 %
  Total interest income   65,522     50,475   29.8 %
  Interest expense      
  Deposits   21,430     14,000   53.1 %
  Borrowings   4,169     2,286   82.4 %
  Total interest expense   25,599     16,286   57.2 %
  Net interest income   39,923     34,189   16.8 %
  Provision for credit losses       1,500   -100.0 %
  Net interest income after provision      
  for credit losses   39,923     32,689   22.1 %
         
  Noninterest income      
  Trust and wealth management fees   847     811   4.4 %
  Mortgage origination revenue   154     171   -9.9 %
  Service charges on deposit accounts   1,723     1,392   23.8 %
  Bank card revenue   1,833     1,568   16.9 %
  Net gains on equity investments   40     45   -11.1 %
  Net realized losses on debt securities   (94 )   (59 ) 59.3 %
  Bank owned life insurance and annuity income   463     336   37.8 %
  Other income   112     122   -8.2 %
  Total noninterest income   5,078     4,386   15.8 %
  Noninterest expense      
  Salaries and employee benefits   12,058     10,807   11.6 %
  Net occupancy expense   1,695     1,333   27.2 %
  Equipment expense   2,508     2,030   23.5 %
  Professional fees   385     376   2.4 %
  Advertising and public relations   272     170   60.0 %
  Amortization of intangibles   987     343   187.8 %
  FDIC premiums   717     330   117.3 %
  Bank card expense   832     696   19.5 %
  Foreclosed properties expense, net of (gains)/losses   12     15   -20.0 %
  Acquisition-related expense   53     331   -84.0 %
  Other expenses   3,439     2,968   15.9 %
  Total noninterest expense   22,958     19,399   18.3 %
  Income before income taxes   22,043     17,676   24.7 %
  Income taxes   4,996     3,575   39.7 %
  Net income   17,047     14,101   20.9 %
  Preferred stock dividends   225     225   n/a
         
  Net income applicable to common shares $ 16,822   $ 13,876   21.2 %
 
SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)    
Quarterly Performance Summary (unaudited)      
Q1 2024 vs Q1 2023    
         
    For the Quarter Ended Percent
    3/31/2024 3/31/2023 Change
Per Share Data      
  Earnings per common share      
  Basic $ 1.15   $ 1.09   5.5 %
  Diluted $ 1.14   $ 1.08   5.6 %
         
  Cash dividends per common share $ 0.22   $ 0.20   10.0 %
  Common stock dividend payout ratio   19.0 %   18.1 % 5.0 %
         
  Average common shares outstanding      
  Basic   14,683,596     12,783,851   14.9 %
  Diluted   14,750,052     12,830,102   15.0 %
         
  Common shares outstanding at period end   14,686,738     12,786,404   14.9 %
         
Performance Ratios      
  Return on average equity   15.37 %   15.55 % -1.2 %
  Return on average tangible equity (C)   19.27 %   19.10 % 0.9 %
  Return on average tangible common equity (D)   20.08 %   20.10 % -0.1 %
  Return on average assets   1.47 %   1.43 % 2.8 %
  Net interest margin (A)   3.75 %   3.83 % -2.1 %
  Efficiency ratio (B)   48.29 %   48.00 % 0.6 %
         
NOTES

(A) – Presented on a tax-equivalent basis assuming a federal tax rate of 21%.

(B) – Non-GAAP financial measure computed on a tax equivalent basis excluding acquisition-related expenses, gains/losses on sales of assets, write-downs of OREO properties to fair value and amortization of intangibles.

(C) – Non-GAAP financial measure that equals: (Net income + Amortization of intangibles [after-tax]) / (Average shareholders’ equity – Average intangible assets).

(D) – Non-GAAP financial measure that equals: (Net income + Amortization of intangibles [after-tax]) / (Average common shareholders’ equity – Average intangible assets).

 

    

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)        
Five Quarter Performance Summary (unaudited)          
           
    For the Quarter Ended
Dollars in thousands 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
Statements of Income          
  Interest income          
  Loans, including fees $ 59,249   $ 59,856   $ 58,102   $ 54,413   $ 45,485  
  Securities   6,141     6,538     6,357     6,247     4,819  
  Other   132     122     235     203     171  
  Total interest income   65,522     66,516     64,694     60,863     50,475  
  Interest expense          
  Deposits   21,430     21,417     19,924     17,851     14,000  
  Borrowings   4,169     4,306     3,497     2,699     2,286  
  Total interest expense   25,599     25,723     23,421     20,550     16,286  
  Net interest income   39,923     40,793     41,273     40,313     34,189  
  Provision for credit losses       1,500     1,250     8,000     1,500  
  Net interest income after provision          
  for credit losses   39,923     39,293     40,023     32,313     32,689  
  Noninterest income          
  Trust and wealth management fees   847     952     819     854     811  
  Mortgage origination revenue   154     65     172     169     171  
  Service charges on deposit accounts   1,723     1,866     1,775     1,943     1,392  
  Bank card revenue   1,833     1,837     1,907     1,987     1,568  
  Net gains on equity investments   40     365     180     150     45  
  Net realized gains/(losses) on debt securities   (94 )   15     (12 )   (211 )   (59 )
  Bank owned life insurance and annuity income   463     499     311     431     336  
  Other income   112     202     113     100     122  
  Total noninterest income   5,078     5,801     5,265     5,423     4,386  
  Noninterest expense          
  Salaries and employee benefits   12,058     11,374     11,959     12,156     10,807  
  Net occupancy expense   1,695     1,554     1,436     1,528     1,333  
  Equipment expense   2,508     2,342     2,361     2,361     2,030  
  Professional fees   385     529     400     471     376  
  Advertising and public relations   272     432     247     264     170  
  Amortization of intangibles   987     995     998     999     343  
  FDIC premiums   717     670     716     742     330  
  Bank card expense   832     809     972     951     696  
  Foreclosed properties expense, net of (gains)/losses   12     16     10     48     15  
  Acquisition-related expenses   53     839     1,110     4,163     331  
  Other expenses   3,439     4,347     3,953     3,641     2,968  
  Total noninterest expense   22,958     23,907     24,162     27,324     19,399  
  Income before income taxes   22,043     21,187     21,126     10,412     17,676  
  Income tax expense   4,996     4,590     4,794     2,203     3,575  
  Net income   17,047     16,597     16,332     8,209     14,101  
  Preferred stock dividends   225     225     225     225     225  
             
  Net income applicable to common shares $ 16,822   $ 16,372   $ 16,107   $ 7,984   $ 13,876  
 
SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)          
Five Quarter Performance Summary (unaudited)            
             
    For the Quarter Ended  
    3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023  
Per Share Data            
  Earnings per common share            
  Basic $ 1.15   $ 1.12   $ 1.10   $ 0.54   $ 1.09    
  Diluted $ 1.14   $ 1.11   $ 1.09   $ 0.54   $ 1.08    
               
  Cash dividends per common share $ 0.22   $ 0.22   $ 0.22   $ 0.20   $ 0.20    
  Common stock dividend payout ratio   19.0 %   19.5 %   19.8 %   36.7 %   18.1 %  
               
  Average common shares outstanding            
  Basic   14,683,596     14,676,383     14,672,176     14,668,923     12,783,851    
  Diluted   14,750,052     14,718,790     14,714,211     14,703,636     12,830,102    
               
  Common shares outstanding at period end   14,686,738     14,683,457     14,674,852     14,672,147     12,786,404    
               
Performance Ratios            
  Return on average equity   15.37 %   15.74 %   15.66 %   7.99 %   15.55 %  
  Return on average tangible equity (C)   19.27 %   20.01 %   20.03 %   10.86 %   19.10 %  
  Return on average tangible common equity (D)   20.08 %   20.91 %   20.95 %   11.37 %   20.10 %  
  Return on average assets   1.47 %   1.42 %   1.42 %   0.73 %   1.43 %  
  Net interest margin (A)   3.75 %   3.76 %   3.88 %   3.89 %   3.83 %  
  Efficiency ratio (B)   48.29 %   47.33 %   47.15 %   47.90 %   48.00 %  
 
NOTES

(A) – Presented on a tax-equivalent basis assuming a federal tax rate of 21%.

(B) – Non-GAAP financial measure computed on a tax equivalent basis excluding acquisition-related expenses, gains/losses on sales of assets, write-downs of OREO properties to fair value and amortization of intangibles.

(C) – Non-GAAP financial measure that equals: (Net income + Amortization of intangibles [after-tax]) / (Average shareholders’ equity – Average intangible assets).

(D) – Non-GAAP financial measure that equals: (Net income applicable to common shares + Amortization of intangibles [after-tax]) / (Average common shareholders’ equity – Average intangible assets).

 
SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)          
Selected Balance Sheet Data (unaudited)          
Dollars in thousands, except per share amounts 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
Assets          
  Cash and due from banks $ 23,706   $ 21,834   $ 23,159   $ 23,341   $ 16,488  
  Interest bearing deposits other banks   31,950     30,398     36,398     39,902     54,328  
  Debt securities, available for sale   490,271     502,762     511,403     512,038     431,933  
  Debt securities, held to maturity   93,737     94,227     94,715     95,200     95,682  
  Equity investments   11,571     10,958     31,241     30,818     29,867  
  Other investments   21,842     21,130     19,579     16,014     12,696  
  Loans, net   3,647,810     3,633,522     3,551,686     3,506,880     3,059,099  
  Property held for sale   3,432     3,729     4,505     4,742     5,128  
  Premises and equipment, net   62,293     63,038     62,721     60,967     54,491  
  Goodwill and other intangible assets, net   73,443     74,430     75,425     76,423     61,807  
  Cash surrender value of life insurance policies and annuities   86,230     85,679     85,076     84,790     72,019  
  Derivative financial instruments   36,803     33,145     44,527     39,951     34,758  
  Other assets   59,796     59,470     63,773     61,204     49,111  
  Total assets $ 4,642,884   $ 4,634,322   $ 4,604,208   $ 4,552,270   $ 3,977,407  
Liabilities and Shareholders’ Equity          
  Deposits $ 3,748,415   $ 3,715,148   $ 3,754,495   $ 3,735,034   $ 3,299,846  
  Short-term borrowings   262,359     302,957     258,054     232,150     140,150  
  Long-term borrowings and          
  subordinated debentures, net   124,123     124,008     123,892     123,776     123,660  
  Other liabilities   53,706     52,001     51,315     48,136     44,205  
  Total liabilities   4,188,603     4,194,114     4,187,756     4,139,096     3,607,861  
  Preferred stock and related surplus   14,920     14,920     14,920     14,920     14,920  
  Common stock and related surplus   130,235     129,990     130,508     130,227     90,939  
  Retained earnings   316,375     302,783     289,641     276,762     271,712  
  Accumulated other comprehensive loss   (7,249 )   (7,485 )   (18,617 )   (8,735 )   (8,025 )
  Total shareholders’ equity   454,281     440,208     416,452     413,174     369,546  
  Total liabilities and shareholders’ equity $ 4,642,884   $ 4,634,322   $ 4,604,208   $ 4,552,270   $ 3,977,407  
             
  Book value per common share $ 29.92   $ 28.96   $ 27.36   $ 27.14   $ 27.73  
  Tangible book value per common share (A) $ 24.91   $ 23.89   $ 22.22   $ 21.93   $ 22.90  
  Tangible common equity to tangible assets (B)   8.0 %   7.7   7.2 %   7.2 %   7.5 %
             
NOTES

(A)   – Tangible book value per share = (Common stock and related surplus plus Retained earnings plus Accumulated other comprehensive income/loss – Intangible assets) / Common shares outstanding.

(B)   – Tangible common equity to tangible assets = (Common stock and related surplus plus Retained earnings plus Accumulated other comprehensive income/loss – Intangible assets) / (Total assets – Intangible assets).

 
SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)        
Loan Composition (unaudited)            
               
Dollars in thousands 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023  
               
Commercial   $ 533,214   $ 503,842   $ 511,951   $ 511,457   $ 498,268  
Mortgage warehouse lines   108,858     108,848     114,734     118,785     86,240  
Commercial real estate            
Owner occupied   569,407     545,108     547,886     566,447     469,560  
Non-owner occupied   1,280,948     1,254,337     1,217,029     1,193,927     1,036,358  
Construction and development            
Land and development   105,425     145,258     114,354     117,371     102,351  
Construction     341,727     374,026     349,049     309,709     290,556  
Residential real estate            
Conventional     507,599     505,398     497,076     483,998     395,312  
Jumbo     123,132     116,614     113,837     117,219     111,475  
Home equity     80,027     81,126     81,967     86,050     70,167  
Consumer     43,107     43,756     44,288     44,429     36,531  
Other     3,598     3,299     6,748     3,169     3,117  
Total loans, net of unearned fees   3,697,042     3,681,612     3,598,919     3,552,561     3,099,935  
Less allowance for loan credit losses     49,232     48,090     47,233     45,681     40,836  
Loans, net $ 3,647,810   $ 3,633,522   $ 3,551,686   $ 3,506,880   $ 3,059,099  
               
Unfunded loan commitments $ 911,132   $ 950,001   $ 943,508   $ 957,278   $ 907,757  
        
 
SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)        
Deposit Composition (unaudited)          
               
Dollars in thousands   3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023  
Core deposits              
Non-interest bearing checking $ 605,509   $ 593,576   $ 630,055   $ 679,139   $ 552,716  
Interest bearing checking   2,145,824     2,164,522     2,144,737     2,024,341     1,886,011  
Savings     438,451     450,526     477,348     512,129     462,631  
Time deposits     525,932     473,687     469,530     465,026     327,037  
Total core deposits   3,715,716     3,682,311     3,721,670     3,680,635     3,228,395  
               
Brokered time deposits   32,699     32,837     32,825     54,399     71,451  
Total deposits $ 3,748,415   $ 3,715,148   $ 3,754,495   $ 3,735,034   $ 3,299,846  
               
Estimated uninsured deposits (A) $ 1,288,845   $ 1,291,467   $ 1,283,610   $ 1,189,908   $ 933,703  
               
(A) – Excludes uninsured public funds otherwise secured or collateralized as required by law.
 
SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)        
Regulatory Capital Ratios (unaudited)            
    3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023  
Summit Financial Group, Inc.            
  CET1 Risk-based Capital 9.4 % 9.1 % 8.9 % 8.7 % 8.9 %  
  Tier 1 Risk-based Capital 10.2 % 9.9 % 9.7 % 9.5 % 9.8 %  
  Total Risk-based Capital 14.0 % 13.7 % 13.5 % 13.3 % 14.0 %  
  Tier 1 Leverage 9.0 % 8.7 % 8.5 % 8.4 % 8.7 %  
               
Summit Community Bank, Inc.            
  CET1 Risk-based Capital 12.0 % 11.7 % 11.6 % 11.3 % 11.9 %  
  Tier 1 Risk-based Capital 12.0 % 11.7 % 11.6 % 11.3 % 11.9 %  
  Total Risk-based Capital 13.3 % 12.9 % 12.7 % 12.5 % 13.1 %  
  Tier 1 Leverage 10.6 % 10.2 % 10.1 % 9.9 % 10.6 %  
        
 
SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)        
Asset Quality Information (unaudited)          
    For the Quarter Ended
Dollars in thousands 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
  Gross loan charge-offs $ 776   $ 444   $ 227   $ 4,009   $ 164  
  Gross loan recoveries   (869 )   (632 )   (108 )   (118 )   (227 )
  Net loan charge-offs (recoveries) $ (93 ) $ (188 ) $ 119   $ 3,891   $ (63 )
             
  Net loan charge-offs (recoveries) to average loans (annualized)   -0.01 %   -0.02 %   0.01 %   0.44 %   -0.01 %
             
  Allowance for loan credit losses $ 49,232   $ 48,090   $ 47,233   $ 45,681   $ 40,836  
  Allowance for loan credit losses as a percentage          
  of period end loans   1.33 %   1.31 %   1.31 %   1.29 %   1.32 %
             
  Allowance for credit losses on          
  unfunded loan commitments (“ULC”) $ 6,692   $ 7,742   $ 6,912   $ 7,332   $ 6,572  
  Allowance for credit losses on ULC          
  as a percentage of period end ULC   0.73 %   0.81 %   0.73 %   0.81 %   0.72 %
             
  Nonperforming assets:          
  Nonperforming loans          
  Commercial $ 7,827   $ 1,088   $ 783   $ 254   $ 402  
  Commercial real estate   8,378     5,675     6,402     5,970     1,700  
  Residential construction and development   891     708     750     772     813  
  Residential real estate   4,436     4,831     4,787     4,298     4,322  
  Consumer   95     137     124     46     65  
  Total nonperforming loans   21,627     12,439     12,846     11,340     7,302  
  Foreclosed properties          
  Commercial real estate       297     297     297     297  
  Commercial construction and development   1,253     1,253     2,187     2,187     2,187  
  Residential construction and development   1,924     1,924     1,924     2,161     2,293  
  Residential real estate   255     255     97     97     351  
  Total foreclosed properties   3,432     3,729     4,505     4,742     5,128  
  Total nonperforming assets $ 25,059   $ 16,168   $ 17,351   $ 16,082   $ 12,430  
             
  Nonperforming loans to period end loans   0.58 %   0.34 %   0.36 %   0.32 %   0.24 %
  Nonperforming assets to period end assets   0.54 %   0.35 %   0.38 %   0.35 %   0.31 %
       
 
SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)        
Loans Past Due 30-89 Days (unaudited)          
             
Dollars in thousands 3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
             
  Commercial $ 183   $ 1,152   $ 3,300   $ 1,006   $ 463  
  Commercial real estate   281     1,711     781     513     1,000  
  Construction and development       570     793     161     3,459  
  Residential real estate   4,570     6,114     4,620     4,933     2,311  
  Consumer   379     401     440     389     252  
  Other   10     43     37     17     13  
  Total $ 5,423   $ 9,991   $ 9,971   $ 7,019   $ 7,498  
             
 
SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)                    
Average Balance Sheet, Interest Earnings & Expenses and Average Rates              
Q1 2024 vs Q4 2023 vs Q1 2023 (unaudited)                    
                         
  Q1 2024   Q4 2023   Q1 2023  
  Average Earnings / Yield /   Average Earnings / Yield /   Average Earnings / Yield /  
Dollars in thousands Balances Expense Rate   Balances Expense Rate   Balances Expense Rate  
                         
ASSETS                        
Interest earning assets                        
Loans, net of unearned interest (1)                      
Taxable $ 3,686,788   $ 59,204   6.46 %   $ 3,688,505   $ 59,802   6.43 %   $ 3,087,068   $ 45,421   5.97 %  
Tax-exempt (2)   4,427     57   5.18 %     4,357     68   6.19 %     6,086     81   5.40 %  
Securities                        
Taxable   413,656     5,025   4.89 %     410,211     5,129   4.96 %     314,004     3,412   4.41 %  
Tax-exempt (2)   184,810     1,413   3.08 %     206,375     1,784   3.43 %     216,430     1,781   3.34 %  
Interest bearing deposits other banks                      
and Federal funds sold   29,287     132   1.81 %     31,053     122   1.56 %     34,330     171   2.02 %  
Total interest earning assets   4,318,968     65,831   6.13 %     4,340,501     66,905   6.12 %     3,657,918     50,866   5.64 %  
                         
Noninterest earning assets                        
Cash & due from banks   24,037           22,485           17,387        
Premises & equipment   62,773           63,298           54,112        
Intangible assets   74,057           75,043           62,024        
Other assets   194,694           215,821           190,533        
Allowance for loan credit losses   (48,897 )         (47,834 )         (39,507 )      
Total assets $ 4,625,632         $ 4,669,314         $ 3,942,467        
                         
 LIABILITIES AND SHAREHOLDERS’ EQUITY                    
                         
Liabilities                        
Interest bearing liabilities                        
Interest bearing                        
demand deposits   2,126,722     15,480   2.93 %     2,170,953     16,196   2.96 %     1,819,505     10,796   2.41 %  
Savings deposits   442,122     1,822   1.66 %     459,277     1,986   1.72 %     480,207     1,917   1.62 %  
Time deposits   531,125     4,128   3.13 %     508,383     3,235   2.52 %     389,252     1,287   1.34 %  
Short-term borrowings   298,325     2,661   3.59 %     309,657     2,791   3.58 %     166,365     824   2.01 %  
Long-term borrowings and                        
subordinated debentures   124,060     1,508   4.89 %     123,954     1,515   4.85 %     123,599     1,462   4.80 %  
Total interest bearing liabilities   3,522,354     25,599   2.92 %     3,572,224     25,723   2.86 %     2,978,928     16,286   2.22 %  
                         
Noninterest bearing liabilities                        
Demand deposits   605,190           621,082           557,209        
Other liabilities   54,513           54,160           43,508        
Total liabilities   4,182,057           4,247,466           3,579,645        
                         
Shareholders’ equity – preferred   14,920           14,920           14,920        
Shareholders’ equity – common   428,655           406,928           347,902        
Total liabilities and                        
shareholders’ equity $ 4,625,632         $ 4,669,314         $ 3,942,467        
                         
NET INTEREST EARNINGS   $ 40,232         $ 41,182         $ 34,580      
                         
NET INTEREST MARGIN     3.75 %       3.76 %       3.83 %  
                         
(1) – For purposes of this table, nonaccrual loans are included in average loan balances.          
(2) – Interest income on tax-exempt securities and loans has been adjusted assuming a Federal tax rate of 21% for all periods presented.
The tax equivalent adjustment resulted in an increase in interest income of $309,000, $389,000, and $391,000 for Q1 2024,
Q4 2023 and Q1 2023, respectively.                    
                         
 
Contact:   Robert S. Tissue, Executive Vice President & CFO
Telephone:   (304) 530-0552
Email:   [email protected]

 


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