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: | rtissue@summitfgi.com |
