MOOREFIELD, W.Va., Jan. 25, 2007 (PRIME NEWSWIRE) -- Summit Financial Group, Inc. (Nasdaq:SMMF) today reported the results of its consolidated operations and its continuing operations which excludes from income substantially all business activities of Summit Mortgage, its residential mortgage loan origination unit, following the Company's announcement on November 17, 2006 of its intent either to sell or terminate that business:
* Consolidated net income for 2006 was $8.3 million, or $1.15 per diluted share, compared with $11.2 million, or $1.56 per diluted share, reported for 2005. * Income from continuing operations was $11.1 million, or $1.54 per diluted share, an increase of 27.0 percent and 27.3 percent, respectively, compared with $8.7 million, or $1.21 per diluted share, reported for 2005. * A one-time after-tax charge of $1.6 million ($0.23 per diluted share) related to the termination of Summit Mortgage's business was recognized in fourth quarter 2006 and is included as a component of discontinued operations to record the write down of furniture, equipment and leasehold improvements to fair value and to record certain exit costs primarily related to severance benefits and the termination of operating lease obligations.
Fiscal year 2005 results include a $1.5 million pre-tax other-than-temporary non-cash impairment charge, equivalent to $940,000 on an after-tax basis, or $0.13 per diluted share. This impairment charge related to $5.7 million of certain preferred stock issuances of the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation which Summit continues to own.
The returns on average shareholders' equity and average assets from continuing operations were 14.00 percent and 0.94 percent, respectively, compared with prior year ratios of 12.31 percent and 0.90 percent. Results reflect strong loan growth from community banking year over year, but has recently begun to moderate, offset by net interest margin pressures and a higher loan loss provision.
* For the fourth quarter of 2006, Summit reported net income of $181,000, or $0.03 per diluted share, compared with $2.4 million, or $.34 per diluted share for the fourth quarter of 2005. * Income from continuing operations was $2.7 million, or $0.39 per diluted share, up 42.3 percent and 44.4 percent, respectively, compared with $1.9 million, or $0.27 per diluted share for the prior-year quarter.
Fourth quarter 2005 results include the above-mentioned non-cash impairment charge of $940,000, or $0.13 per diluted share. Returns on average shareholders' equity and average assets from continuing operations for the fourth quarter of 2006 were 13.24 percent and 0.89 percent, respectively, compared with 2005 fourth quarter ratios of 10.30 percent and 0.72 percent.
H. Charles Maddy, III, President and Chief Executive Officer, commented, "2006 was a difficult year for Summit as we came to terms with a difficult business model in an unforgiving economy. Although we had recognized that Summit Mortgage was not performing up to expectations, we were hopeful that conditions would permit more time to realign these activities. Ultimately, however the continuing uncertainty for performance improvement dictated that it was in the best interest of our shareholders to exit the mortgage business, which we have done.
"Our community banking markets, by comparison, have demonstrated exceptional resilience to economic conditions. Loan growth over the past twelve months has been a very satisfactory 15.5 percent - more moderate than in the past, but sufficiently strong to support top-line growth -- as we have done successfully every quarter this past year, despite margin compression. We continue to see excellent opportunities within our markets. Our recent decision to exit mortgage banking will allow us to focus our resources and capital on these community banking opportunities."
SUMMARY OF RESULTS FROM CONTINUING OPERATIONS
Total revenue for 2006, consisting of net interest income plus non-interest income, was $39.5 million, an increase of 21.1 percent compared to the $32.7 million reported for 2005. Excluding the $1.5 million impairment charge included in 2005 results, total revenue increased 15.8 percent. Net interest income grew 17.1 percent above the prior year, to $35.3 million, reflecting 22.6 percent growth in average earning assets, partially offset by a 19 basis point decline in the net interest margin to 3.32 percent. Non-interest income for 2006, was $4.3 million compared with $2.5 million for the prior year; excluding the non-cash impairment charge incurred in 2005, non-interest income increased 6.2 percent, from $4.0 million in the prior year to $4.3 million. The increase reflected solid growth in insurance commissions and service fees.
For the fourth quarter of 2006, total revenue was $10.3 million compared with $7.5 million for the year-earlier quarter; excluding the $1.5 million impairment charge included in fourth quarter 2005 results, total revenue increased 14.3 percent. Net interest income was $9.2 million compared with $8.1 million in the prior-year quarter, an increase of 13.9 percent. The increase reflected 17.3 percent growth in average earning assets, partially offset by a 14 basis point decline in the net interest margin to 3.25 percent. Non-interest income, excluding the fourth quarter 2005 impairment charge, increased 17.7 percent, from $928,000 in the prior-year quarter to $1.1 million for the current period.
Non-interest expense for 2006 was $21.6 million compared with $19.3 million for the prior year, an increase of 12.2 percent. The efficiency ratio (of continuing operations) was 51.51 percent compared with 52.85 percent for 2005. Non-interest expense has remained relatively flat over the past four quarters. For the fourth quarter of 2006, non-interest expense was $5.3 compared with $4.9 million for the fourth quarter of 2005, an increase of 7.9 percent. The efficiency ratio was 48.85 percent for the fourth quarter of 2006 compared with 50.73 percent for the prior-year quarter, and 49.38 percent for the linked quarter.
Asset quality remains sound overall; however, nonperforming loans showed a $3.9 million increase this quarter, which resulted primarily from the loans of a single customer relationship. Summit is well-collateralized with regard to this credit, and adequate reserves have already been taken. At present, we do not anticipate any significant further deterioration in asset quality in the near term. Nonperforming assets were $5.4 million or 0.43 percent of assets at December 31, 2006, compared with $1.7 million, or 0.15 percent, 12 months ago. Net charge-offs for 2006 were $445,000, equivalent to 0.05 percent of average loans, compared with $257,000 and 0.04 percent of loans for the preceding year. At period-end, loan loss reserves were 0.81 percent of loans.
Assets at December 31, 2006 were $1.23 billion, an increase of $125.3 million, or 11.3 percent over the last twelve months. Loans, net of unearned income, were $923.6 million at December 31, 2006, up $124.0 million or 15.5 percent year-over-year. Commercial real estate and construction/development were the largest contributors to growth, up $48.0 million (18.0 percent) and $74.6 million (52.8 percent), respectively, since December 31, 2005. Together, these two categories comprised 57.3 percent of the loan portfolio, with residential mortgages accounting for an additional 30.5 percent.
Deposits at December 31, 2006 were $888.7 million, an increase of $214.8 million, or 31.9 percent above prior year-end levels. Nearly $609 million of these deposits are derived from retail accounts, particularly interest bearing checking accounts, which grew $19.5 million or 9.7 percent from year-ago levels. Brokered deposits increased $150.8 million, or 117.1 percent, compared to the prior year.
Shareholders' equity at December 31, 2006 was $79.9 million, an increase of 8.2 percent over the last twelve months. Common shares outstanding totaled 7,089,680 at year-end. In August 2006, we announced a plan to repurchase up to 225,000 share of our common stock, and accordingly, during the fourth quarter we repurchased 21,500 shares under this plan.
ABOUT THE COMPANY
Summit Financial Group, Inc., a financial holding company with total assets of $1.2 billion, operates fifteen banking locations through its two wholly-owned community banks: Summit Community Bank, headquartered in Moorefield, West Virginia; and Shenandoah Valley National Bank in Winchester, Virginia. Summit also operates Summit Insurance Services, LLC in Moorefield, West Virginia.
The Summit Financial Group, Inc. logo is available at http://www.primezone.com/newsroom/prs/?pkgid=2990
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 changes in interest rates and interest rate relationships; demand for products and services; the degree of competition by traditional and non-traditional competitors; 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 economy. We undertake no obligation to revise these statements following the date of this press release.
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF)
Quarterly Performance Summary -- Q4 2006 vs Q4 2005
For the Quarter Ended
------------------------- Percent
Dollars in thousands 12/31/2006 12/31/2005 Change
---------------------------------------------------------------------
Condensed Statements of
Income
Interest income
Loans, including fees $ 19,434 $ 14,088 37.9%
Securities 3,131 2,368 32.2%
Other 7 30 -76.7%
-------- --------
Total interest income 22,572 16,486 36.9%
-------- --------
Interest expense
Deposits 8,990 4,450 102.0%
Borrowings 4,393 3,971 10.6%
-------- --------
Total interest expense 13,383 8,421 58.9%
-------- --------
Net interest income 9,189 8,065 13.9%
Provision for loan losses 930 260 257.7%
-------- --------
Net interest income after
provision for loan losses 8,259 7,805 5.8%
-------- --------
Noninterest income
Insurance commissions 228 247 -7.7%
Service fee income 702 680 3.2%
Securities gains (losses) -- (1,434) -100.0%
Other income 162 (65) -349.2%
-------- --------
Total noninterest income 1,092 (572) -290.9%
-------- --------
Noninterest expense
Salaries and employee
benefits 2,899 2,770 4.7%
Net occupancy expense 378 357 5.9%
Equipment expense 480 408 17.6%
Professional fees 252 207 21.7%
Other expenses 1,291 1,170 10.3%
-------- --------
Total noninterest expense 5,300 4,912 7.9%
-------- --------
Income from continuing
operations before income
taxes 4,051 2,321 74.5%
Income taxes 1,328 408 225.5%
-------- --------
Income from continuing
operations 2,723 1,913 42.3%
-------- --------
Discontinued operations
Exit costs and impairment
of long-lived assets (2,480) -- n/a
Operating income (loss) (1,373) 703 -295.3%
-------- --------
Income from discontinued
operations before income
taxes (3,853) 703 -648.1%
Income taxes (1,311) 174 -853.4%
-------- --------
Income (loss) from
discontinued operations (2,542) 529 -580.5%
-------- --------
Net Income $ 181 $ 2,442 -92.6%
======== ========
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF)
Quarterly Performance Summary -- Q4 2006 vs Q4 2005
For the Quarter Ended
--------------------------- Percent
12/31/2006 12/31/2005 Change
---------------------------------------------------------------------
Per Share Data
Earnings per share from
continuing operations
Basic $ 0.39 $ 0.27 44.4%
Diluted $ 0.39 $ 0.27 44.4%
Earnings per share from
discontinued operations
Basic $ (0.36) $ 0.07 -614.3%
Diluted $ (0.36) $ 0.07 -614.3%
Earnings per share
Basic $ 0.03 $ 0.34 -91.2%
Diluted $ 0.03 $ 0.34 -91.2%
Average shares outstanding
Basic 7,092,531 7,125,994 -0.5%
Diluted 7,151,378 7,198,068 -0.6%
Performance Ratios
Return on average equity 0.88% 13.15% -93.3%
Return on average equity
- continuing operations 13.24% 10.30% 28.5%
Return on average assets 0.06% 0.92% -93.5%
Return on average assets
- continuing operations 0.89% 0.72% 23.6%
Net interest margin 3.25% 3.39% -4.1%
Efficiency ratio (A) 69.20% 65.50% 5.6%
Efficiency ratio -
continuing operations (A) 48.85% 50.73% -3.7%
NOTE: (A) - Computed on a tax equivalent basis excluding nonrecurring
income and expense items and amortization of intangibles.
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF)
Annual Performance Summary -- 2006 vs 2005
For the Year Ended
------------------------- Percent
Dollars in thousands 12/31/2006 12/31/2005 Change
---------------------------------------------------------------------
Condensed Statements
of Income
Interest income
Loans, including fees $ 68,656 $ 47,344 45.0%
Securities 11,562 9,201 25.7%
Other 60 108 -44.4%
-------- ---------
Total interest income 80,278 56,653 41.7%
-------- ---------
Interest expense
Deposits 28,312 13,402 111.3%
Borrowings 16,670 13,104 27.2%
-------- ---------
Total interest expense 44,982 26,506 69.7%
-------- ---------
Net interest income 35,296 30,147 17.1%
Provision for loan losses 1,845 1,295 42.5%
-------- ---------
Net interest income after
provision for loan losses 33,451 28,852 15.9%
-------- ---------
Noninterest income
Insurance commissions 924 853 8.3%
Service fee income 2,758 2,589 6.5%
Securities gains (losses) -- (1,390) -100.0%
Other income 571 451 26.6%
-------- ---------
Total noninterest income 4,253 2,503 69.9%
-------- ---------
Noninterest expense
Salaries and employee
benefits 11,821 10,810 9.4%
Net occupancy expense 1,557 1,371 13.6%
Equipment expense 1,901 1,713 11.0%
Professional fees 893 748 19.4%
Other expenses 5,438 4,621 17.7%
-------- ---------
Total noninterest expense 21,610 19,263 12.2%
-------- ---------
Income from continuing
operations before income
taxes 16,094 12,092 33.1%
Income taxes 5,024 3,373 48.9%
-------- ---------
Income from continuing
operations 11,070 8,719 27.0%
-------- ---------
Discontinued operations
Exit costs and impairment
of long-lived assets (2,480) -- n/a
Operating income (loss) (1,750) 3,862 -145.3%
-------- ---------
Income (loss) from
discontinued operations
before income taxes (4,230) 3,862 -209.5%
Income taxes (1,427) 1,339 -206.6%
-------- ---------
Income (loss) from
discontinued operations (2,803) 2,523 -211.1%
-------- ---------
Net Income $ 8,267 $ 11,242 -26.5%
======== ========
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF)
Annual Performance Summary -- 2006 vs 2005
For the Year Ended
----------------------------- Percent
12/31/2006 12/31/2005 Change
---------------------------------------------------------------------
Per Share Data
Earnings per share
from continuing
operations
Basic $ 1.55 $ 1.23 26.1%
Diluted $ 1.54 $ 1.21 27.3%
Earnings per share
from discontinued
operations
Basic $ (0.39) $ 0.35 -211.4%
Diluted $ (0.39) $ 0.35 -211.4%
Earnings per share
Basic $ 1.16 $ 1.58 -26.5%
Diluted $ 1.15 $ 1.56 -26.3%
Average shares
outstanding
Basic 7,120,762 7,093,402 0.4%
Diluted 7,183,526 7,206,838 -0.3%
Performance Ratios
Return on average equity 10.46% 15.87% -34.1%
Return on average equity
- continuing operations 14.00% 12.31% 13.7%
Return on average assets 0.70% 1.16% -39.7%
Return on average assets
- continuing operations 0.94% 0.90% 4.4%
Net interest margin 3.32% 3.51% -5.4%
Efficiency ratio (A) 69.91% 66.93% 4.5%
Efficiency ratio -
continuing operations (A) 51.51% 52.85% -2.5%
NOTE: (A) - Computed on a tax equivalent basis excluding nonrecurring
income and expense items and amortization of intangibles.
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF)
Five Quarter Performance Summary
For the Quarter Ended
----------------------------------------------
Dollars in 12/31/ 9/30/ 6/30/ 3/31/ 12/31/
thousands 2006 2006 2006 2006 2005
---------------------------------------------------------------------
Condensed Statements
of Income
Interest income
Loans, including
fees $19,434 $18,060 $16,609 $15,240 $14,088
Securities 3,131 2,998 2,787 2,647 2,368
Other 7 16 13 24 30
------- ------- ------- ------- -------
Total interest
income 22,572 21,074 19,409 17,911 16,486
------- ------- ------- ------- -------
Interest expense
Deposits 8,990 7,761 6,408 5,153 4,450
Borrowings 4,393 4,239 4,348 4,379 3,971
------- ------- ------- ------- -------
Total interest
expense 13,383 12,000 10,756 9,532 8,421
------- ------- ------- ------- -------
Net interest income 9,189 9,074 8,653 8,379 8,065
Provision for loan
losses 930 260 330 325 260
------- ------- ------- ------- -------
Net interest income
after provision
for loan losses 8,259 8,814 8,323 8,054 7,805
------- ------- ------- ------- -------
Noninterest income
Insurance
commissions 228 219 247 230 247
Service fee income 702 700 726 631 680
Securities gains
(losses) -- -- -- -- (1,434)
Other income 162 131 136 142 (65)
------- ------- ------- ------- -------
Total noninterest
income 1,092 1,050 1,109 1,003 (572)
------- ------- ------- ------- -------
Noninterest expense
Salaries and
employee benefits 2,899 2,817 3,049 3,055 2,770
Net occupancy
expense 378 387 390 401 357
Equipment expense 480 476 496 450 408
Professional fees 252 188 245 207 207
Other expenses 1,291 1,409 1,492 1,248 1,170
------- ------- ------- ------- -------
Total noninterest
expense 5,300 5,277 5,672 5,361 4,912
------- ------- ------- ------- -------
Income before income
taxes 4,051 4,587 3,760 3,696 2,321
Income taxes 1,328 1,421 1,167 1,108 408
------- ------- ------- ------- -------
Income from
continuing
operations 2,723 3,166 2,593 2,588 1,913
------- ------- ------- ------- -------
Discontinued
operations
Exit costs and
impairment of
long-lived assets (2,480) -- -- -- --
Operating income
(loss) (1,373) (1,059) 74 609 703
------- ------- ------- ------- -------
Income from
discontinued
operations
before income taxes (3,853) (1,059) 74 609 703
Income taxes (1,311) (374) 33 226 174
------- ------- ------- ------- -------
Income (loss) from
discontinued
operations (2,542) (685) 41 383 529
------- ------- ------- ------- -------
Net Income $ 181 $ 2,481 $ 2,634 $ 2,971 $ 2,442
======= ======= ======= ======= =======
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF)
Five Quarter Performance Summary
For the Quarter Ended
---------------------------------------------------
12/31/ 9/30/ 6/30/ 3/31/ 12/31/
2006 2006 2006 2006 2005
---------------------------------------------------------------------
Per Share Data
Earnings per
share from
continuing
operations
Basic $ 0.39 $ 0.45 $ 0.36 $ 0.36 $ 0.27
Diluted $ 0.39 $ 0.45 $ 0.36 $ 0.36 $ 0.27
Earnings per
share from
discontinued
operations
Basic $(0.36) $(0.10) $ 0.01 $ 0.06 $ 0.07
Diluted $(0.36) $(0.10) $ 0.01 $ 0.05 $ 0.07
Earnings per
share
Basic $ 0.03 $ 0.35 $ 0.37 $ 0.42 $ 0.34
Diluted $ 0.03 $ 0.35 $ 0.37 $ 0.41 $ 0.34
Average shares
outstanding
Basic 7,092,531 7,127,650 7,135,107 7,128,076 7,125,994
Diluted 7,151,378 7,187,274 7,193,407 7,192,924 7,198,068
Performance Ratios
Return on
average equity 0.88% 12.46% 13.53% 15.60% 13.15%
Return on
average equity
- continuing
operations 13.24% 15.90% 13.32% 13.59% 10.30%
Return on
average assets 0.06% 0.83% 0.91% 1.05% 0.92%
Return on
average assets
- continuing
operations 0.89% 1.06% 0.89% 0.92% 0.72%
Net interest
margin 3.25% 3.33% 3.32% 3.39% 3.39%
Efficiency
ratio (A) 69.20% 70.57% 70.69% 69.16% 65.50%
Efficiency
ratio -
continuing
operations (A) 48.85% 49.38% 54.33% 53.76% 50.73%
NOTE: (A) - Computed on a tax equivalent basis excluding nonrecurring
income and expense items and amortization of intangibles.
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF)
Selected Balance Sheet Data
For the Quarter Ended
--------------------------------------------------------
Dollars in
thousands,
except per
share 12/31/ 9/30/ 6/30/ 3/31/ 12/31/
amounts 2006 2006 2006 2006 2005
----------------------------------------------------------------------
Assets $1,234,831 $1,210,491 $1,179,648 $1,137,692 $1,109,532
Securities 247,874 246,332 238,382 233,805 223,772
Loans, net 916,045 894,836 866,170 824,359 793,452
Intangible
assets 3,197 3,234 3,272 3,310 3,348
Assets
related
to
discontinued
operations 9,715 8,369 11,633 14,577 18,411
Retail
deposits 609,064 598,293 570,731 560,551 545,104
Brokered
time
deposits 279,623 266,769 190,832 170,185 128,797
Short-term
borrowings 60,428 90,422 164,185 136,483 182,028
Long-term
borrowings
and
subordinated
debentures 193,881 163,864 167,168 183,136 170,501
Shareholders'
equity 79,875 80,630 76,559 75,816 73,803
Book value
per
share $ 11.27 $ 11.35 $ 10.73 $ 10.63 $ 10.36
SUMMIT FINANCIAL GROUP INC. (NASDAQ:SMMF)
Loan Composition
Dollars
in 12/31/ 9/30/ 6/30/ 3/31/ 12/31/
thousands 2006 2006 2006 2006 2005
---------------------------------------------------------------------
Commercial $ 69,470 $ 67,352 $ 64,342 $ 66,564 $ 63,206
Commercial
real estate 314,199 300,676 296,680 275,896 266,228
Construction
and
development 215,820 207,545 182,000 165,026 141,207
Residential
real estate 282,512 283,943 288,316 281,301 285,242
Consumer 36,455 36,885 37,040 37,356 36,863
Other 6,968 7,086 6,188 6,382 8,598
-------- -------- -------- -------- --------
Total loans 925,424 903,487 874,566 832,525 801,344
Less unearned
fees and
interest 1,868 1,806 1,767 1,731 1,780
-------- -------- -------- -------- --------
Total loans
net of
unearned
fees and
interest 923,556 901,681 872,799 830,794 799,564
Less allowance
for loan losses 7,511 6,845 6,629 6,435 6,112
-------- -------- -------- -------- --------
Loans, net $916,045 $894,836 $866,170 $824,359 $793,452
======== ======== ======== ======== ========
SUMMIT FINANCIAL GROUP INC. (NASDAQ:SMMF)
Retail Deposit Composition
Dollars in
thousands 12/31/ 9/30/ 6/30/ 3/31/ 12/31/
2006 2006 2006 2006 2005
----------------------------------------------------------------------
Non interest
bearing
checking $ 62,591 $ 64,751 $ 66,071 $ 62,860 $ 62,631
Interest
bearing
checking 220,167 223,992 214,279 214,572 200,638
Savings 47,984 44,980 38,737 39,474 44,681
Time deposits 278,322 264,570 251,644 243,645 237,154
-------- -------- -------- -------- --------
Total
retail
deposits $609,064 $598,293 $570,731 $560,551 $545,104
======== ======== ======== ======== ========
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF)
Asset Quality Information - Continuing Operations
For the Quarter Ended
------------------------------------------
12/31/ 9/30/ 6/30/ 3/31/ 12/31/
Dollars in thousands 2006 2006 2006 2006 2005
----------------------------------------------------------------------
Net loan charge-off's $ 263 $ 45 $ 135 $ 2 $ 70
Net loan charge-off's to
average loans
(annualized) 0.11% 0.02% 0.06% 0.00% 0.04%
Allowance for loan losses $7,511 $6,845 $6,629 $6,435 $6,112
Allowance for loan losses
as a percentage of
period end loans 0.81% 0.76% 0.76% 0.77% 0.76%
Nonperforming assets:
Nonperforming loans $5,276 $1,273 $ 987 $1,447 $1,382
Foreclosed properties
and other repossessed
assets 77 180 298 271 285
------ ------ ------ ------ ------
Total $5,353 $1,453 $1,285 $1,718 $1,667
====== ====== ====== ====== ======
Nonperforming loans to
period end loans 0.57% 0.14% 0.11% 0.17% 0.17%
==== ==== ==== ==== ====
Nonperforming assets to
period end assets 0.43% 0.12% 0.11% 0.15% 0.15%
==== ==== ==== ==== ====
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF)
Average Balance Sheet, Interest Earnings & Expenses and Average Rates
Q4 2006 vs Q4 2005
Q4 2006 Q4 2005
------------------------- -------------------------
Dollars in Average Earnings/ Yield/ Average Earnings/ Yield/
thousands Balances Expense Rate Balances Expense Rate
----------------------------------------- -------------------------
ASSETS
Interest
earning
assets
Loans, net
of unearned
interest
Taxable $ 914,050 $18,735 8.13% $ 773,394 $14,160 7.26%
Tax-exempt 8,591 166 7.67% 8,106 150 7.34%
Securities
Taxable 202,758 2,566 5.02% 169,871 1,847 4.31%
Tax-exempt 47,666 842 7.01% 46,315 778 6.66%
Interest
bearing
deposits
other banks
and Federal
funds sold 517 11 8.44% 2,899 32 4.38%
---------- ------- ---- ---------- ------- ----
Total interest
earning assets 1,173,582 22,320 7.55% 1,000,585 16,967 6.73%
Noninterest
earning assets
Cash & due
from banks 12,393 20,525
Premises &
equipment 23,309 22,732
Other assets 26,786 24,389
Allowance for
loan losses (7,339) (6,075)
---------- ----------
Total
assets $1,228,731 $1,062,156
========== ==========
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Liabilities
Interest
bearing
liabilities
Interest
bearing
demand
deposits $ 221,943 $ 2,066 3.69% $ 181,251 $ 1,252 2.74%
Savings
deposits 46,804 243 2.06% 44,917 77 0.68%
Time deposits 549,785 6,679 4.82% 352,146 3,122 3.52%
Short-term
borrowings 35,033 1,040 11.78% 160,159 1,700 4.21%
Long-term
borrowings
and
subordinated
debentures 218,943 2,666 4.83% 175,116 2,270 5.14%
---------- ------- ---- ---------- ------- ----
1,072,508 12,694 4.70% 913,589 8,421 3.66%
Noninterest
bearing
liabilities
Demand
deposits 63,671 65,378
Other
liabilities 10,307 8,882
---------- ----------
Total
liabil-
ities 1,146,486 987,849
Shareholders'
equity 82,245 74,307
---------- ----------
Total
liabilities
and
shareholders'
equity $1,228,731 $1,062,156
========== ==========
NET INTEREST
EARNINGS $ 9,626 $ 8,546
======= =======
NET INTEREST
MARGIN 3.25% 3.39%
==== ====
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF)
Average Balance Sheet, Interest Earnings & Expenses and Average Rates
YTD 2006 vs YTD 2005
For the Year Ended December 31,
------------------------------------------------------
2006 2005
------------------------- -------------------------
Dollars in Average Earnings/ Yield/ Average Earnings/ Yield/
thousands Balances Expense Rate Balances Expense Rate
----------------------------------------- -------------------------
ASSETS
Interest
earning
assets
Loans, net
of unearned
interest
Taxable $ 872,017 $68,915 7.90% $ 691,041 $47,582 6.89%
Tax-exempt 8,428 642 7.62% 8,688 635 7.31%
Securities
Taxable 193,046 9,403 4.87% 164,611 7,076 4.30%
Tax-exempt 46,382 3,227 6.96% 47,563 3,180 6.69%
Interest
bearing
deposits
other banks
and Federal
funds sold 1,216 62 5.10% 2,779 109 3.92%
---------- ------- ---- ---------- ------- ----
Total
interest
earning
assets 1,121,089 82,249 7.34% 914,682 58,582 6.40%
Noninterest
earning assets
Cash & due
from banks 13,417 17,583
Premises &
equipment 23,496 21,234
Other assets 26,422 21,121
Allowance for
loan losses (6,849) (5,652)
---------- ----------
Total
assets $1,177,575 $ 968,968
========== ==========
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Liabilities
Interest
bearing
liabilities
Interest
bearing
demand
deposits $ 215,642 $ 7,476 3.47% $ 151,271 $ 3,120 2.06%
Savings
deposits 42,332 554 1.31% 47,745 312 0.65%
Time deposits 458,864 20,282 4.42% 319,377 9,970 3.12%
Short-term
borrowings 130,771 6,612 5.06% 138,694 4,824 3.48%
Long-term
borrowings
and
subordinated
debentures 176,422 10,058 5.70% 172,260 8,280 4.81%
---------- ------- ---- ---------- ------- ----
1,024,031 44,982 4.39% 829,347 26,506 3.20%
Noninterest
bearing
liabilities
Demand
deposits 64,380 61,543
Other
liabilities 10,106 7,258
---------- ----------
Total
liabil-
ities 1,098,517 898,148
Shareholders'
equity 79,058 70,820
---------- ----------
Total
liabilities
and
shareholders'
equity $1,177,575 $ 968,968
========== ==========
NET INTEREST
EARNINGS $37,267 $32,076
======= =======
NET INTEREST
MARGIN 3.32% 3.51%
==== ====