Summit Financial Group, Inc. (“Company” or “Summit”) (NASDAQ:SMMF)
today reported first quarter 2016 net income of $4.06 million, or
$0.38 per diluted share, representing a decrease of 5.2 percent, or
7.3 percent per diluted share, compared to the $4.29 million, or
$0.41 per diluted share, reported for the first quarter of 2015,
and a decrease of 2.0 percent, or 2.6 percent per diluted share,
compared to the $4.15 million, or $0.39 per diluted share, reported
for the fourth quarter of 2015. Q1 2016 earnings compared to Q1
2015 and Q4 2015 were negatively impacted by increased personnel
costs and other noninterest expenses as well as reductions in
insurance commission revenue, which were partially offset by
increased net interest earnings and reductions in write-downs of
foreclosed properties.
Excluding from first quarter 2016 one-time items of income,
gain, expense and loss, Q1 2016 core earnings approximated $3.96
million, or $0.37 per diluted share compared to Q1 2015 core
earnings of $4.33 million, or $0.40 per diluted share, and to Q4
2015 core earnings of $4.08 million, or $0.38 per diluted
share.
Highlights for Q1 2016 include:
- Net interest margin remained stable compared to the linked
quarter, but has declined 9 basis points since Q1 2015.
- Achieved loan growth of $17.3 million or 6.3 percent (on an
annualized basis). Loans have grown $57.6 million or 5.5 percent
since Q1 2015.
- Core revenue for the quarter is unchanged compared to Q4 2015,
and is up $189,000 or 1.3 percent compared to Q1 2015.
- Nonperforming assets as a percentage of total assets declined
to 2.66 percent compared to 2.77 percent for the linked quarter,
and 3.18 percent at Q1 2015; foreclosed properties are at the
lowest level since Q2 2009.
- Recorded charges of $109,000 to write-down foreclosed
properties compared to $636,000 in Q4 2015 and $572,000 in Q1
2015.
- Announced our entering into a definitive merger agreement to
acquire Highland County Bankshares, Inc. headquartered in Monterey,
Virginia.
H. Charles Maddy III, President and Chief Executive Officer of
Summit, commented, “I am pleased to report Summit achieved another
quarter of solid performance, despite the challenges of higher
overhead costs resulting from important investments we are making
in both our people and in our infrastructure to assist to maintain
our growth momentum. Our solid core earnings, growing loan
portfolio and continued reductions in our portfolio of problem
assets are all very gratifying to note; but I am particularly
gratified by the opportunity represented by our pending acquisition
of Highland County Bankshares. This deal will combine two
financially strong banks with similar cultures, core values and
guiding principles, as well as a shared commitment to build
long-term client relationships by providing service beyond
expectations.”
Results from Operations
Total revenue for first quarter 2016, consisting of net interest
income and noninterest income, declined 0.5 percent to $14.6
million compared to $14.7 million for the first quarter 2015, and
was unchanged compared to the linked quarter.
Total core revenue (excluding nonrecurring items, enumerated
above) was $14.2 million for first quarter 2015, $14.0 million for
the same prior-year quarter and $14.2 million for the linked
quarter.
For the first quarter of 2016, net interest income was $11.8
million, an increase of 2.2 percent from the $11.5 million reported
in the prior-year first quarter and increased $46,000 compared to
the linked quarter. The net interest margin for first quarter 2016
was 3.50 percent compared to 3.59 percent for the year-ago quarter,
and 3.51 percent for the linked quarter.
Noninterest income, consisting primarily of insurance
commissions from Summit's insurance agency subsidiary and service
fee income from community banking activities, for first quarter
2016 was $2.81 million compared to $3.14 million for the comparable
period of 2015 and $2.87 million for Q4 2015. Excluding realized
securities gains, noninterest income was $2.41 million for first
quarter 2016 compared to $2.66 million reported for first quarter
2015 and $2.45 million for linked quarter. The quarter over
year-ago quarter decline principally resulted from decreased
insurance commission revenues, while the decline compared to the
linked quarter was due to lower service fees on deposit
accounts.
Summit recognized $250,000 provision for loan losses in first
quarter 2016, as well as for the linked quarter and for the
year-ago quarter.
Total noninterest expense increased 4.3% to $8.55 million
compared to $8.20 million for the prior-year first quarter and
increased 0.7 percent compared to $8.49 million for the linked
quarter. Excluding from noninterest expense merger expenses,
gains and losses on sales of foreclosed properties and write-downs
of foreclosed properties, noninterest expense would have
approximated $8.34 million for Q1 2016, $7.48 million for the
comparable period of 2015 and $8.17 million for linked quarter. The
Q1 2016 compared to Q1 2015 increase is primarily due to net
additions of staff, general merit raises and higher incentive
compensation.
Balance Sheet
At March 31, 2016, total assets were $1.51 billion, an increase
of $16.1 million, or 1.1 percent since December 31, 2015. Total
loans, net of unearned fees and allowance for loan losses, were
$1.10 billion at March 31, 2016, up $17.5 million, or 1.6 percent,
from the $1.08 billion reported at year-end 2015.
At March 31, 2016, deposits were $1.09 billion, an increase of
$27.8 million, or 2.6 percent, since year end 2015. During Q1 2016,
checking deposits declined by $1.5 million or 0.4 percent, while
savings deposits increased $19.9 million, or 7.4 percent.
Asset Quality
As of March 31, 2016, nonperforming assets (“NPAs”), consisting
of nonperforming loans, foreclosed properties, and repossessed
assets, were $40.1 million, or 2.66 percent of assets. This
compares to $41.3 million, or 2.77 percent of assets at the linked
quarter, and $46.4 million, or 3.18 percent of assets, at first
quarter 2015.
First quarter 2016 net loan charge-offs were $407,000, or 0.15
percent of average loans on an annualized basis. The allowance for
loan losses stood at $11.3 million, or 1.02 percent of total loans
at March 31, 2016, compared to 1.05 percent at year-end 2015.
Capital Adequacy
Shareholders’ equity was $146.1 million as of March 31, 2016
compared to $143.7 million December 31, 2015. Tangible book value
per common share increased to $12.98 at March 31, 2016 compared to
$12.78 at December 31, 2015. Summit had 10,681,880 outstanding
common shares at Q1 2016 quarter end compared to 10,671,744 at year
end 2015.
Summit's depository institution, Summit Community Bank, Inc.
(the “Bank”), is well in excess of regulatory requirements for a
"well capitalized" institution at March 31, 2016. The Bank’s total
risk-based capital ratio was 14.5 percent at both March 31, 2016
and December 31, 2015, while its Tier 1 leverage capital ratio was
10.7 percent at March 31, 2016 compared to the 10.8 percent
reported at December 31, 2015.
About the Company
Summit Financial Group, Inc. is a $1.51 billion financial
holding company headquartered in Moorefield, West Virginia. Summit
provides community banking services primarily in the Eastern
Panhandle and South Central regions of West Virginia and the
Northern and Shenandoah Valley regions of Virginia, through its
bank subsidiary, Summit Community Bank, Inc., which operates
fifteen banking locations. Summit also operates Summit Insurance
Services, LLC in Moorefield, West Virginia and Leesburg,
Virginia.
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 economies. We undertake no
obligation to revise these statements following the date of this
press release.
NON-GAAP FINANCIAL MEASURES
This press release contains financial information determined by
methods other than in accordance with generally accepted accounting
principles in the United States of America ("GAAP").
Specifically, Summit adjusted GAAP performance measures to exclude
the effects of realized and unrealized securities gains and losses,
gains/losses on sales of assets, and write-downs of foreclosed
properties to estimated fair value included in its Statements of
Income. Management believes presentations of financial
measures excluding the impact of these items provide useful
supplemental information that is important for a proper
understanding of the operating results of Summit's core business.
These disclosures should not be viewed as a substitute for
operating results determined in accordance with GAAP, nor are they
necessarily comparable to non-GAAP performance measures that may be
presented by other companies.
|
|
|
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF) |
|
|
Quarterly Performance Summary -- Q1 2016 vs Q1
2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Quarter
Ended |
Percent |
Dollars in thousands |
3/31/2016 |
3/31/2015 |
Change |
Condensed Statements of
Income |
|
|
|
|
Interest income |
|
|
|
|
Loans, including fees |
$ |
13,436 |
|
$ |
12,848 |
|
|
4.6 |
% |
|
Securities |
|
1,726 |
|
|
1,894 |
|
|
-8.9 |
% |
|
Other |
|
3 |
|
|
1 |
|
|
200.0 |
% |
|
Total
interest income |
|
15,165 |
|
|
14,743 |
|
|
2.9 |
% |
|
Interest expense |
|
|
|
|
Deposits |
|
2,170 |
|
|
2,071 |
|
|
4.8 |
% |
|
Borrowings |
|
1,216 |
|
|
1,152 |
|
|
5.6 |
% |
|
Total
interest expense |
|
3,386 |
|
|
3,223 |
|
|
5.1 |
% |
|
Net interest income |
|
11,779 |
|
|
11,520 |
|
|
2.2 |
% |
|
|
|
|
|
|
Provision for loan losses |
|
250 |
|
|
250 |
|
|
0.0 |
% |
|
Net interest income after
provision |
|
|
|
|
for loan losses |
|
11,529 |
|
|
11,270 |
|
|
2.3 |
% |
|
|
|
|
|
|
Noninterest income |
|
|
|
|
Insurance commissions |
|
924 |
|
|
1,128 |
|
|
-18.1 |
% |
|
Service fees related to deposit
accounts |
|
978 |
|
|
976 |
|
|
0.2 |
% |
|
Realized securities gains
(losses) |
|
393 |
|
|
480 |
|
|
-18.1 |
% |
|
Other income |
|
511 |
|
|
555 |
|
|
-7.9 |
% |
|
Total
noninterest income |
|
2,806 |
|
|
3,139 |
|
|
-10.6 |
% |
|
Noninterest expense |
|
|
|
|
Salaries and employee benefits |
|
4,682 |
|
|
4,187 |
|
|
11.8 |
% |
|
Net occupancy expense |
|
540 |
|
|
498 |
|
|
8.4 |
% |
|
Equipment expense |
|
656 |
|
|
535 |
|
|
22.6 |
% |
|
Professional fees |
|
472 |
|
|
335 |
|
|
40.9 |
% |
|
FDIC premiums |
|
300 |
|
|
330 |
|
|
-9.1 |
% |
|
Merger expense |
|
112 |
|
|
- |
|
n/a |
|
Foreclosed properties expense |
|
124 |
|
|
208 |
|
|
-40.4 |
% |
|
Loss (gain) on sales of foreclosed
properties |
|
(6 |
) |
|
150 |
|
n/a |
|
Write-downs of foreclosed
properties |
|
109 |
|
|
572 |
|
|
-80.9 |
% |
|
Other expenses |
|
1,565 |
|
|
1,389 |
|
|
12.7 |
% |
|
Total
noninterest expense |
|
8,554 |
|
|
8,204 |
|
|
4.3 |
% |
|
Income before income
taxes |
|
5,781 |
|
|
6,205 |
|
|
-6.8 |
% |
|
Income taxes |
|
1,719 |
|
|
1,920 |
|
|
-10.5 |
% |
|
Net
income |
$ |
4,062 |
|
$ |
4,285 |
|
|
-5.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF) |
|
|
Quarterly Performance Summary -- Q1 2016 vs Q1
2015 |
|
|
|
|
|
|
|
|
For the Quarter
Ended |
Percent |
|
|
3/31/2016 |
3/31/2015 |
Change |
Per
Share Data |
|
|
|
|
Earnings per common
share |
|
|
|
|
Basic |
$ |
0.38 |
|
$ |
0.49 |
|
|
-22.4 |
% |
|
Diluted |
$ |
0.38 |
|
$ |
0.41 |
|
|
-7.3 |
% |
|
|
|
|
|
|
Cash dividends |
$ |
0.10 |
|
$ |
0.08 |
|
|
25.0 |
% |
|
|
|
|
|
|
Average common shares
outstanding |
|
|
|
|
Basic |
|
10,671,856 |
|
|
8,815,961 |
|
|
21.1 |
% |
|
Diluted |
|
10,679,301 |
|
|
10,493,323 |
|
|
1.8 |
% |
|
|
|
|
|
|
Common shares
outstanding at period end |
|
10,681,880 |
|
|
10,586,242 |
|
|
0.9 |
% |
|
|
|
|
|
Performance Ratios |
|
|
|
|
Return on average equity |
|
11.10 |
% |
|
12.79 |
% |
|
-13.2 |
% |
|
Return on average tangible
equity |
|
11.70 |
% |
|
13.56 |
% |
|
-13.7 |
% |
|
Return on average assets |
|
1.08 |
% |
|
1.18 |
% |
|
-8.5 |
% |
|
Net interest margin |
|
3.50 |
% |
|
3.59 |
% |
|
-2.5 |
% |
|
Efficiency ratio (A) |
|
55.93 |
% |
|
49.27 |
% |
|
13.5 |
% |
|
|
|
|
|
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 thousands |
3/31/2016 |
12/31/2015 |
9/30/2015 |
6/30/2015 |
3/31/2015 |
Condensed Statements of
Income |
|
|
|
|
|
|
Interest income |
|
|
|
|
|
|
Loans, including fees |
$ |
13,436 |
|
$ |
13,265 |
|
$ |
12,983 |
|
$ |
12,972 |
|
$ |
12,848 |
|
|
Securities |
|
1,726 |
|
|
1,685 |
|
|
1,543 |
|
|
1,685 |
|
|
1,894 |
|
|
Other |
|
3 |
|
|
1 |
|
|
5 |
|
|
1 |
|
|
1 |
|
|
Total
interest income |
|
15,165 |
|
|
14,951 |
|
|
14,531 |
|
|
14,658 |
|
|
14,743 |
|
|
Interest expense |
|
|
|
|
|
|
Deposits |
|
2,170 |
|
|
2,085 |
|
|
2,106 |
|
|
2,074 |
|
|
2,071 |
|
|
Borrowings |
|
1,216 |
|
|
1,133 |
|
|
1,120 |
|
|
1,126 |
|
|
1,152 |
|
|
Total
interest expense |
|
3,386 |
|
|
3,218 |
|
|
3,226 |
|
|
3,200 |
|
|
3,223 |
|
|
Net
interest income |
|
11,779 |
|
|
11,733 |
|
|
11,305 |
|
|
11,458 |
|
|
11,520 |
|
|
|
|
|
|
|
|
|
Provision for loan
losses |
|
250 |
|
|
250 |
|
|
250 |
|
|
500 |
|
|
250 |
|
|
Net interest income
after provision |
|
|
|
|
|
|
for loan losses |
|
11,529 |
|
|
11,483 |
|
|
11,055 |
|
|
10,958 |
|
|
11,270 |
|
|
|
|
|
|
|
|
|
Noninterest income |
|
|
|
|
|
|
Insurance commissions |
|
924 |
|
|
851 |
|
|
983 |
|
|
1,080 |
|
|
1,128 |
|
|
Service fees related to deposit
accounts |
|
978 |
|
|
1,126 |
|
|
1,111 |
|
|
1,072 |
|
|
976 |
|
|
Realized securities gains
(losses) |
|
393 |
|
|
421 |
|
|
372 |
|
|
170 |
|
|
480 |
|
|
Other income |
|
511 |
|
|
471 |
|
|
527 |
|
|
538 |
|
|
555 |
|
|
Total
noninterest income |
|
2,806 |
|
|
2,869 |
|
|
2,993 |
|
|
2,860 |
|
|
3,139 |
|
|
Noninterest
expense |
|
|
|
|
|
|
Salaries and employee benefits |
|
4,682 |
|
|
4,530 |
|
|
4,479 |
|
|
4,442 |
|
|
4,187 |
|
|
Net occupancy expense |
|
540 |
|
|
481 |
|
|
496 |
|
|
489 |
|
|
498 |
|
|
Equipment expense |
|
656 |
|
|
617 |
|
|
582 |
|
|
560 |
|
|
535 |
|
|
Professional fees |
|
472 |
|
|
507 |
|
|
402 |
|
|
372 |
|
|
335 |
|
|
FDIC premiums |
|
300 |
|
|
270 |
|
|
300 |
|
|
320 |
|
|
330 |
|
|
Merger expense |
|
112 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
Foreclosed properties expense |
|
124 |
|
|
150 |
|
|
168 |
|
|
158 |
|
|
208 |
|
|
Loss (gain) on sale of foreclosed
properties |
|
(6 |
) |
|
(314 |
) |
|
35 |
|
|
103 |
|
|
150 |
|
|
Write-downs of foreclosed
properties |
|
109 |
|
|
636 |
|
|
1,046 |
|
|
160 |
|
|
572 |
|
|
Other expenses |
|
1,565 |
|
|
1,617 |
|
|
1,364 |
|
|
1,457 |
|
|
1,389 |
|
|
Total
noninterest expense |
|
8,554 |
|
|
8,494 |
|
|
8,872 |
|
|
8,061 |
|
|
8,204 |
|
|
Income before income
taxes |
|
5,781 |
|
|
5,858 |
|
|
5,176 |
|
|
5,757 |
|
|
6,205 |
|
|
Income taxes |
|
1,719 |
|
|
1,712 |
|
|
1,515 |
|
|
1,747 |
|
|
1,920 |
|
|
Net
income |
$ |
4,062 |
|
$ |
4,146 |
|
$ |
3,661 |
|
$ |
4,010 |
|
$ |
4,285 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF) |
|
|
|
|
|
Five Quarter Performance Summary |
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Quarter
Ended |
|
|
3/31/16 |
12/31/2015 |
9/30/2015 |
6/30/2015 |
3/31/2015 |
Per
Share Data |
|
|
|
|
|
|
Earnings per common
share |
|
|
|
|
|
|
Basic |
$ |
0.38 |
|
$ |
0.39 |
|
$ |
0.34 |
|
$ |
0.38 |
|
$ |
0.49 |
|
|
Diluted |
$ |
0.38 |
|
$ |
0.39 |
|
$ |
0.34 |
|
$ |
0.38 |
|
$ |
0.41 |
|
|
|
|
|
|
|
|
|
Cash dividends |
$ |
0.10 |
|
$ |
0.08 |
|
$ |
0.08 |
|
$ |
0.08 |
|
$ |
0.08 |
|
|
|
|
|
|
|
|
|
Average common shares
outstanding |
|
|
|
|
|
|
Basic |
|
10,671,856 |
|
|
10,661,700 |
|
|
10,703,526 |
|
|
10,667,892 |
|
|
8,815,961 |
|
|
Diluted |
|
10,679,301 |
|
|
10,669,192 |
|
|
10,712,203 |
|
|
10,676,474 |
|
|
10,493,323 |
|
|
|
|
|
|
|
|
|
Common shares
outstanding at period end |
|
10,681,880 |
|
|
10,671,744 |
|
|
10,658,199 |
|
|
10,843,676 |
|
|
10,586,242 |
|
|
|
|
|
|
|
|
Performance Ratios |
|
|
|
|
|
|
Return on average equity |
|
11.10 |
% |
|
11.66 |
% |
|
10.42 |
% |
|
11.67 |
% |
|
12.79 |
% |
|
Return on average tangible
equity |
|
11.70 |
% |
|
12.31 |
% |
|
11.01 |
% |
|
12.36 |
% |
|
13.56 |
% |
|
Return on average assets |
|
1.08 |
% |
|
1.12 |
% |
|
1.00 |
% |
|
1.09 |
% |
|
1.18 |
% |
|
Net interest margin |
|
3.50 |
% |
|
3.51 |
% |
|
3.41 |
% |
|
3.49 |
% |
|
3.59 |
% |
|
Efficiency ratio (A) |
|
55.93 |
% |
|
54.46 |
% |
|
52.93 |
% |
|
52.05 |
% |
|
49.27 |
% |
|
|
|
|
|
|
|
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
amounts |
3/31/2016 |
12/31/2015 |
9/30/2015 |
6/30/2015 |
3/31/2015 |
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
Cash and due from
banks |
$ |
4,005 |
|
$ |
3,625 |
|
$ |
4,232 |
|
$ |
3,988 |
|
$ |
3,850 |
|
|
Interest bearing
deposits other banks |
|
12,655 |
|
|
5,862 |
|
|
8,057 |
|
|
9,274 |
|
|
8,437 |
|
|
Securities |
|
271,515 |
|
|
280,792 |
|
|
272,127 |
|
|
276,661 |
|
|
282,135 |
|
|
Loans, net |
|
1,096,790 |
|
|
1,079,331 |
|
|
1,062,348 |
|
|
1,064,472 |
|
|
1,039,669 |
|
|
Property held for
sale |
|
24,684 |
|
|
25,567 |
|
|
29,713 |
|
|
31,500 |
|
|
34,368 |
|
|
Premises and equipment,
net |
|
21,589 |
|
|
21,572 |
|
|
20,457 |
|
|
20,490 |
|
|
20,208 |
|
|
Intangible assets |
|
7,448 |
|
|
7,498 |
|
|
7,548 |
|
|
7,598 |
|
|
7,648 |
|
|
Cash surrender value of
life insurance policies |
|
37,989 |
|
|
37,732 |
|
|
37,482 |
|
|
37,222 |
|
|
36,961 |
|
|
Other assets |
|
31,893 |
|
|
30,450 |
|
|
27,340 |
|
|
28,764 |
|
|
27,216 |
|
|
Total
assets |
$ |
1,508,568 |
|
$ |
1,492,429 |
|
$ |
1,469,304 |
|
$ |
1,479,969 |
|
$ |
1,460,492 |
|
|
|
|
|
|
|
|
Liabilities and Shareholders'
Equity |
|
|
|
|
|
|
Deposits |
$ |
1,094,544 |
|
$ |
1,066,709 |
|
$ |
1,072,091 |
|
$ |
1,053,310 |
|
$ |
1,058,308 |
|
|
Short-term
borrowings |
|
153,448 |
|
|
171,394 |
|
|
145,291 |
|
|
174,599 |
|
|
148,985 |
|
|
Long-term borrowings
and |
|
|
|
|
|
|
subordinated debentures |
|
94,692 |
|
|
95,170 |
|
|
95,648 |
|
|
98,625 |
|
|
101,602 |
|
|
Other liabilities |
|
19,755 |
|
|
15,412 |
|
|
15,985 |
|
|
13,363 |
|
|
15,708 |
|
|
Shareholders'
equity |
|
146,129 |
|
|
143,744 |
|
|
140,289 |
|
|
140,072 |
|
|
135,889 |
|
|
Total
liabilities and shareholders' equity |
$ |
1,508,568 |
|
$ |
1,492,429 |
|
$ |
1,469,304 |
|
$ |
1,479,969 |
|
$ |
1,460,492 |
|
|
|
|
|
|
|
|
|
Book value per common
share (A) |
$ |
13.68 |
|
$ |
13.48 |
|
$ |
13.16 |
|
$ |
12.92 |
|
$ |
12.84 |
|
|
Tangible book value per
common share (A) |
$ |
12.98 |
|
$ |
12.78 |
|
$ |
12.45 |
|
$ |
12.22 |
|
$ |
12.11 |
|
|
Tangible equity to
tangible assets |
|
9.2 |
% |
|
9.2 |
% |
|
9.1 |
% |
|
9.0 |
% |
|
8.8 |
% |
|
Tangible common equity
to tangible assets |
|
9.2 |
% |
|
9.2 |
% |
|
9.1 |
% |
|
9.0 |
% |
|
8.8 |
% |
|
|
|
|
|
|
|
NOTE (A) – Computed on a fully-diluted basis assuming
conversion of convertible preferred stock |
|
|
|
|
|
|
|
SUMMIT FINANCIAL GROUP INC. (NASDAQ:SMMF) |
|
|
|
|
|
Regulatory Capital Ratios (A) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3/31/2016 |
12/31/2015 |
9/30/2015 |
6/30/2015 |
3/31/2015 |
|
Summit Financial Group, Inc. |
|
|
|
|
|
|
|
CET1 Risk-based
Capital |
|
11.9 |
% |
|
11.8 |
% |
|
11.7 |
% |
|
11.6 |
% |
|
11.3 |
% |
|
|
Tier 1 Risk-based
Capital |
|
13.5 |
% |
|
13.4 |
% |
|
13.4 |
% |
|
13.2 |
% |
|
13.0 |
% |
|
|
Total Risk-based
Capital |
|
14.5 |
% |
|
14.4 |
% |
|
14.4 |
% |
|
14.2 |
% |
|
14.0 |
% |
|
|
Tier 1 Leverage
Ratio |
|
10.7 |
% |
|
10.7 |
% |
|
10.5 |
% |
|
10.4 |
% |
|
10.1 |
% |
|
|
|
|
|
|
|
|
|
Summit Community Bank, Inc. |
|
|
|
|
|
|
|
CET1 Risk-based
Capital |
|
13.6 |
% |
|
13.6 |
% |
|
13.6 |
% |
|
13.4 |
% |
|
13.5 |
% |
|
|
Tier 1 Risk-based
Capital |
|
13.6 |
% |
|
13.6 |
% |
|
13.6 |
% |
|
13.4 |
% |
|
13.5 |
% |
|
|
Total Risk-based
Capital |
|
14.5 |
% |
|
14.5 |
% |
|
14.6 |
% |
|
14.4 |
% |
|
14.5 |
% |
|
|
Tier 1 Leverage
Ratio |
|
10.7 |
% |
|
10.8 |
% |
|
10.7 |
% |
|
10.6 |
% |
|
10.5 |
% |
|
|
|
|
|
|
|
|
|
NOTE (A) – Computed in accordance with Basel III regulatory
capital guidelines beginning January 1, 2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUMMIT
FINANCIAL GROUP INC. (NASDAQ:SMMF) |
|
|
|
|
Loan
Composition |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars in thousands |
3/31/2016 |
12/31/2015 |
9/30/2015 |
6/30/2015 |
3/31/2015 |
|
|
|
|
|
|
|
|
|
Commercial |
|
$ |
101,743 |
|
$ |
97,201 |
|
$ |
89,250 |
|
$ |
97,284 |
|
$ |
89,928 |
|
|
Commercial
real estate |
|
|
|
|
|
|
Owner occupied |
|
202,680 |
|
|
203,555 |
|
|
199,068 |
|
|
191,743 |
|
|
180,269 |
|
|
Non-owner occupied |
|
353,350 |
|
|
337,295 |
|
|
336,550 |
|
|
331,056 |
|
|
325,764 |
|
|
Construction
and development |
|
|
|
|
|
|
Land and
development |
|
66,483 |
|
|
65,500 |
|
|
66,164 |
|
|
64,435 |
|
|
66,558 |
|
|
Construction |
|
|
7,997 |
|
|
9,970 |
|
|
8,419 |
|
|
18,214 |
|
|
19,094 |
|
|
Residential
real estate |
|
|
|
|
|
|
Non-jumbo |
|
|
221,368 |
|
|
221,749 |
|
|
222,739 |
|
|
220,199 |
|
|
219,938 |
|
|
Jumbo |
|
|
50,057 |
|
|
50,313 |
|
|
46,092 |
|
|
49,203 |
|
|
50,492 |
|
|
Home equity |
|
|
74,097 |
|
|
74,300 |
|
|
73,652 |
|
|
72,504 |
|
|
68,894 |
|
|
Consumer |
|
|
19,095 |
|
|
19,251 |
|
|
19,124 |
|
|
18,683 |
|
|
18,485 |
|
|
Other |
|
|
11,235 |
|
|
11,669 |
|
|
12,518 |
|
|
12,423 |
|
|
11,074 |
|
|
Total loans, net of
unearned fees |
|
1,108,105 |
|
|
1,090,803 |
|
|
1,073,576 |
|
|
1,075,744 |
|
|
1,050,496 |
|
|
Less allowance
for loan losses |
|
11,315 |
|
|
11,472 |
|
|
11,228 |
|
|
11,272 |
|
|
10,827 |
|
|
Loans, net |
$ |
1,096,790 |
|
$ |
1,079,331 |
|
$ |
1,062,348 |
|
$ |
1,064,472 |
|
$ |
1,039,669 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUMMIT FINANCIAL GROUP INC. (NASDAQ:SMMF) |
|
|
|
|
Deposit Composition |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollars
in thousands |
|
3/31/2016 |
12/31/2015 |
9/30/2015 |
6/30/2015 |
3/31/2015 |
|
Non
interest bearing checking |
$ |
122,378 |
|
$ |
119,010 |
|
$ |
118,887 |
|
$ |
113,256 |
|
$ |
117,049 |
|
|
Interest
bearing checking |
|
210,878 |
|
|
215,721 |
|
|
217,242 |
|
|
202,957 |
|
|
196,606 |
|
|
Savings |
|
|
286,695 |
|
|
266,825 |
|
|
259,185 |
|
|
246,949 |
|
|
257,687 |
|
|
Time deposits |
|
|
474,593 |
|
|
465,153 |
|
|
476,777 |
|
|
490,148 |
|
|
486,966 |
|
|
Total deposits |
$ |
1,094,544 |
|
$ |
1,066,709 |
|
$ |
1,072,091 |
|
$ |
1,053,310 |
|
$ |
1,058,308 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF) |
|
|
|
|
Asset Quality Information |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Quarter
Ended |
Dollars in thousands |
3/31/2016 |
12/31/2015 |
9/30/2015 |
6/30/2015 |
3/31/2015 |
|
|
|
|
|
|
|
|
Gross loan
charge-offs |
$ |
561 |
|
$ |
132 |
|
$ |
774 |
|
$ |
463 |
|
$ |
782 |
|
|
Gross loan
recoveries |
|
(154 |
) |
|
(126 |
) |
|
(481 |
) |
|
(407 |
) |
|
(192 |
) |
|
Net loan charge-offs |
$ |
407 |
|
$ |
6 |
|
$ |
293 |
|
$ |
56 |
|
$ |
590 |
|
|
|
|
|
|
|
|
|
Net loan charge-offs to
average loans (annualized) |
|
0.15 |
% |
|
0.00 |
% |
|
0.11 |
% |
|
0.02 |
% |
|
0.23 |
% |
|
Allowance for loan
losses |
$ |
11,315 |
|
$ |
11,472 |
|
$ |
11,228 |
|
$ |
11,272 |
|
$ |
10,827 |
|
|
Allowance for loan
losses as a percentage |
|
|
|
|
|
|
of period end loans |
|
1.02 |
% |
|
1.05 |
% |
|
1.05 |
% |
|
1.05 |
% |
|
1.03 |
% |
|
Nonperforming
assets: |
|
|
|
|
|
|
Nonperforming loans |
|
|
|
|
|
|
Commercial |
$ |
430 |
|
$ |
853 |
|
$ |
884 |
|
$ |
1,065 |
|
$ |
788 |
|
|
Commercial real estate |
|
6,140 |
|
|
5,955 |
|
|
5,294 |
|
|
2,421 |
|
|
1,340 |
|
|
Commercial construction and
development |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
Residential construction and
development |
|
5,467 |
|
|
5,623 |
|
|
5,345 |
|
|
5,627 |
|
|
5,333 |
|
|
Residential real estate |
|
3,248 |
|
|
3,245 |
|
|
3,881 |
|
|
4,433 |
|
|
4,491 |
|
|
Consumer |
|
121 |
|
|
92 |
|
|
53 |
|
|
45 |
|
|
65 |
|
|
Total
nonperforming loans |
|
15,406 |
|
|
15,768 |
|
|
15,457 |
|
|
13,591 |
|
|
12,017 |
|
|
Foreclosed
properties |
|
|
|
|
|
|
Commercial |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
110 |
|
|
Commercial real estate |
|
976 |
|
|
1,300 |
|
|
3,209 |
|
|
3,279 |
|
|
3,657 |
|
|
Commercial construction and
development |
|
8,717 |
|
|
8,717 |
|
|
9,328 |
|
|
10,178 |
|
|
10,191 |
|
|
Residential construction and
development |
|
13,808 |
|
|
14,068 |
|
|
14,965 |
|
|
15,839 |
|
|
17,590 |
|
|
Residential real estate |
|
1,183 |
|
|
1,482 |
|
|
2,211 |
|
|
2,204 |
|
|
2,819 |
|
|
Total
foreclosed properties |
|
24,684 |
|
|
25,567 |
|
|
29,713 |
|
|
31,500 |
|
|
34,367 |
|
|
Other repossessed
assets |
|
- |
|
|
5 |
|
|
- |
|
|
55 |
|
|
55 |
|
|
Total
nonperforming assets |
$ |
40,090 |
|
$ |
41,340 |
|
$ |
45,170 |
|
$ |
45,146 |
|
$ |
46,439 |
|
|
|
|
|
|
|
|
|
Nonperforming loans to
period end loans |
|
1.39 |
% |
|
1.45 |
% |
|
1.44 |
% |
|
1.26 |
% |
|
1.14 |
% |
|
Nonperforming assets to
period end assets |
|
2.66 |
% |
|
2.77 |
% |
|
3.07 |
% |
|
3.05 |
% |
|
3.18 |
% |
|
|
|
|
|
|
|
Loans Past Due 30-89 Days |
|
|
|
|
|
|
|
For the Quarter
Ended |
In thousands |
3/31/2016 |
12/31/2015 |
9/30/2015 |
6/30/2015 |
3/31/2015 |
|
|
|
|
|
|
|
|
Commercial |
$ |
465 |
|
$ |
339 |
|
$ |
42 |
|
$ |
344 |
|
$ |
387 |
|
|
Commercial real
estate |
|
920 |
|
|
543 |
|
|
1,926 |
|
|
4,945 |
|
|
783 |
|
|
Construction and
development |
|
218 |
|
|
1,182 |
|
|
39 |
|
|
21 |
|
|
2,735 |
|
|
Residential real
estate |
|
3,055 |
|
|
4,442 |
|
|
3,888 |
|
|
3,932 |
|
|
3,614 |
|
|
Consumer |
|
73 |
|
|
186 |
|
|
216 |
|
|
211 |
|
|
148 |
|
|
Other |
|
14 |
|
|
9 |
|
|
9 |
|
|
7 |
|
|
18 |
|
|
Total |
$ |
4,745 |
|
$ |
6,701 |
|
$ |
6,120 |
|
$ |
9,460 |
|
$ |
7,685 |
|
|
|
|
|
|
|
|
SUMMIT FINANCIAL GROUP, INC. (NASDAQ:SMMF) |
|
|
|
|
|
|
Average Balance Sheet, Interest Earnings & Expenses and
Average Rates |
|
|
|
|
|
Q1 2016 vs Q1
2015 |
|
|
|
|
|
|
|
|
|
Q1 2016 |
|
Q1 2015 |
|
|
Average |
Earnings / |
Yield / |
|
Average |
Earnings / |
Yield / |
|
Dollars
in thousands |
Balances |
Expense |
Rate |
|
Balances |
Expense |
Rate |
|
|
|
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
Interest earning
assets |
|
|
|
|
|
|
|
|
Loans, net of unearned
interest |
|
|
|
|
|
|
|
|
Taxable |
$ |
1,089,083 |
|
$ |
13,291 |
|
|
4.91 |
% |
|
$ |
1,035,610 |
|
$ |
12,734 |
|
|
4.99 |
% |
|
Tax-exempt |
|
15,824 |
|
|
220 |
|
|
5.59 |
% |
|
|
12,567 |
|
|
174 |
|
|
5.62 |
% |
|
Securities |
|
|
|
|
|
|
|
|
Taxable |
|
209,365 |
|
|
1,083 |
|
|
2.08 |
% |
|
|
211,471 |
|
|
1,281 |
|
|
2.46 |
% |
|
Tax-exempt |
|
79,314 |
|
|
974 |
|
|
4.94 |
% |
|
|
76,012 |
|
|
927 |
|
|
4.95 |
% |
|
Interest bearing deposits other
banks |
|
|
|
|
|
|
|
|
and Federal funds sold |
|
8,092 |
|
|
3 |
|
|
0.15 |
% |
|
|
7,081 |
|
|
1 |
|
|
0.06 |
% |
|
Total interest earning
assets |
|
1,401,678 |
|
|
15,571 |
|
|
4.47 |
% |
|
|
1,342,741 |
|
|
15,117 |
|
|
4.57 |
% |
|
|
|
|
|
|
|
|
|
|
Noninterest earning
assets |
|
|
|
|
|
|
|
|
Cash & due from banks |
|
3,762 |
|
|
|
|
|
3,679 |
|
|
|
|
Premises & equipment |
|
21,594 |
|
|
|
|
|
20,203 |
|
|
|
|
Other assets |
|
89,642 |
|
|
|
|
|
98,685 |
|
|
|
|
Allowance for loan losses |
|
(11,562 |
) |
|
|
|
|
(11,237 |
) |
|
|
|
Total assets |
$ |
1,505,114 |
|
|
|
|
$ |
1,454,071 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
Interest bearing
liabilities |
|
|
|
|
|
|
|
|
Interest bearing |
|
|
|
|
|
|
|
|
demand deposits |
$ |
209,733 |
|
$ |
83 |
|
|
0.16 |
% |
|
$ |
199,840 |
|
$ |
58 |
|
|
0.12 |
% |
|
Savings deposits |
|
277,396 |
|
|
506 |
|
|
0.73 |
% |
|
|
254,398 |
|
|
428 |
|
|
0.68 |
% |
|
Time deposits |
|
471,597 |
|
|
1,581 |
|
|
1.35 |
% |
|
|
485,975 |
|
|
1,585 |
|
|
1.32 |
% |
|
Short-term borrowings |
|
168,548 |
|
|
240 |
|
|
0.57 |
% |
|
|
144,779 |
|
|
112 |
|
|
0.31 |
% |
|
Long-term borrowings and |
|
|
|
|
|
|
|
|
subordinated debentures |
|
95,052 |
|
|
976 |
|
|
4.13 |
% |
|
|
105,741 |
|
|
1,040 |
|
|
3.99 |
% |
|
Total interest bearing
liabilities |
|
1,222,326 |
|
|
3,386 |
|
|
1.11 |
% |
|
|
1,190,733 |
|
|
3,223 |
|
|
1.10 |
% |
|
|
|
|
|
|
|
|
|
|
Noninterest bearing
liabilities |
|
|
|
|
|
|
|
|
Demand deposits |
|
120,464 |
|
|
|
|
|
115,198 |
|
|
|
|
Other liabilities |
|
15,928 |
|
|
|
|
|
14,096 |
|
|
|
|
Total liabilities |
|
1,358,718 |
|
|
|
|
|
1,320,027 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' equity -
preferred |
|
- |
|
|
|
|
|
7,244 |
|
|
|
|
Shareholders' equity -
common |
|
146,396 |
|
|
|
|
|
126,800 |
|
|
|
|
Total liabilities and |
|
|
|
|
|
|
|
|
shareholders' equity |
$ |
1,505,114 |
|
|
|
|
$ |
1,454,071 |
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INTEREST
EARNINGS |
|
$ |
12,185 |
|
|
|
|
$ |
11,894 |
|
|
|
|
|
|
|
|
|
|
|
|
NET INTEREST
MARGIN |
|
|
|
3.50 |
% |
|
|
|
|
3.59 |
% |
|
|
|
|
|
|
|
|
|
|
SUMMIT
FINANCIAL GROUP, INC. (NASDAQ:SMMF) |
|
|
|
|
|
Reconciliation of Non-GAAP Financial Measures to GAAP
Financial Measures |
|
|
|
|
|
|
|
|
|
For the Quarter
Ended |
|
|
Dollars
in thousands |
3/31/2016 |
12/31/2015 |
3/31/2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core
earnings applicable to common shares |
$ |
3,950 |
|
$ |
4,084 |
|
$ |
4,326 |
|
|
|
|
|
|
|
|
|
FHLB special dividend |
|
- |
|
|
- |
|
|
176 |
|
|
|
Applicable income tax effect |
|
- |
|
|
- |
|
|
(65 |
) |
|
|
Realized securities gains
(losses) |
|
393 |
|
|
421 |
|
|
480 |
|
|
|
Applicable income tax effect |
|
(145 |
) |
|
(156 |
) |
|
(178 |
) |
|
|
Merger expense |
|
(112 |
) |
|
- |
|
|
- |
|
|
|
Applicable income tax effect |
|
41 |
|
|
- |
|
|
- |
|
|
|
Gain (loss) on sale of foreclosed
properties |
|
6 |
|
|
314 |
|
|
(150 |
) |
|
|
Applicable income tax effect |
|
(2 |
) |
|
(116 |
) |
|
56 |
|
|
|
Write-downs foreclosed
properties |
|
(109 |
) |
|
(636 |
) |
|
(572 |
) |
|
|
Applicable income tax effect |
|
40 |
|
|
235 |
|
|
212 |
|
|
|
|
|
112 |
|
|
62 |
|
|
(41 |
) |
|
|
GAAP net
income applicable to common shares |
$ |
4,062 |
|
$ |
4,146 |
|
$ |
4,285 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core
diluted earnings per common share |
$ |
0.37 |
|
$ |
0.38 |
|
$ |
0.40 |
|
|
|
|
|
|
|
|
|
FHLB special dividend |
|
- |
|
|
- |
|
|
0.02 |
|
|
|
Applicable income tax effect |
|
- |
|
|
- |
|
|
- |
|
|
|
Realized securities gains
(losses) |
|
0.04 |
|
|
0.04 |
|
|
0.05 |
|
|
|
Applicable income tax effect |
|
(0.01 |
) |
|
(0.01 |
) |
|
(0.02 |
) |
|
|
Merger expense |
|
(0.01 |
) |
|
- |
|
|
- |
|
|
|
Applicable income tax effect |
|
- |
|
|
- |
|
|
- |
|
|
|
Gain (loss) on sale of foreclosed
properties |
|
- |
|
|
0.03 |
|
|
(0.01 |
) |
|
|
Applicable income tax effect |
|
- |
|
|
(0.01 |
) |
|
- |
|
|
|
Write-downs of foreclosed
properties |
|
(0.01 |
) |
|
(0.06 |
) |
|
(0.05 |
) |
|
|
Applicable income tax effect |
|
- |
|
|
0.02 |
|
|
0.02 |
|
|
|
|
|
0.01 |
|
|
0.01 |
|
|
0.01 |
|
|
|
GAAP
diluted earnings per common share |
$ |
0.38 |
|
$ |
0.39 |
|
$ |
0.41 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUMMIT
FINANCIAL GROUP, INC. (NASDAQ:SMMF) |
|
|
|
|
Reconciliation of Non-GAAP Financial Measures to GAAP
Financial Measures |
|
|
|
|
|
|
|
|
For the Quarter
Ended |
|
Dollars
in thousands |
3/31/2016 |
12/31/2015 |
3/31/2015 |
|
|
|
|
|
|
Total
core revenue |
$ |
14,192 |
|
$ |
14,181 |
|
$ |
14,003 |
|
|
|
|
|
|
|
FHLB special dividend |
|
- |
|
|
- |
|
|
176 |
|
|
Realized securities gains
(losses) |
|
393 |
|
|
421 |
|
|
480 |
|
|
GAAP
total revenue |
$ |
14,585 |
|
$ |
14,602 |
|
$ |
14,659 |
|
|
|
|
|
|
|
|
|
|
|
|
Total
core noninterest income |
$ |
2,413 |
|
$ |
2,448 |
|
$ |
2,659 |
|
|
|
|
|
|
|
Realized securities gains
(losses) |
|
393 |
|
|
421 |
|
|
480 |
|
|
GAAP
total noninterest income |
$ |
2,806 |
|
$ |
2,869 |
|
$ |
3,139 |
|
|
|
|
|
|
|
|
|
|
|
|
Total
core noninterest expense |
$ |
8,339 |
|
$ |
8,172 |
|
$ |
7,482 |
|
|
|
|
|
|
|
Merger expense |
|
112 |
|
|
- |
|
|
- |
|
|
(Gains) losses on sales of
foreclosed properties |
|
(6 |
) |
|
(314 |
) |
|
150 |
|
|
Write-downs of foreclosed
properties |
|
109 |
|
|
636 |
|
|
572 |
|
|
|
|
215 |
|
|
322 |
|
|
722 |
|
|
GAAP
total noninterest expense |
$ |
8,554 |
|
$ |
8,494 |
|
$ |
8,204 |
|
|
Contact: Robert S. Tissue, Sr. Vice President & CFO
Telephone: (304) 530-0552
Email: rtissue@summitfgi.com
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