SMMF Summit Financial Group Inc

Summit Financial Group, Inc. (“Company” or “Summit”) (NASDAQ: SMMF) today reported quarterly net income of $7.09 million for first quarter 2019, or $0.56 per diluted share.  In comparison, earnings for fourth quarter 2018 were $7.45 million, or $0.60 per diluted share, and for first quarter 2018, $7.44 million, or $0.60 per diluted share.

Summit completed its acquisition of Peoples Bankshares, Inc. (“PBI”) and its subsidiary, First Peoples Bank, headquartered in Mullens, West Virginia on January 1, 2019 and will convert substantially all of its data processing systems to that of Summit’s effective April 27, 2019; accordingly, PBI’s results of operations are included in Summit’s consolidated results of operations from the date of acquisition, and therefore Summit’s first quarter 2019 results reflect increased levels of average balances, income and expenses compared to its first quarter 2018 and fourth quarter 2018 results.  At consummation, PBI had total assets of $133.1 million, loans of $42.4 million, and deposits of $112.9 million. In addition, our merger-related expenses totaled $63,000 in Q1 2019 versus $59,000 in the prior quarter.

Highlights for Q1 2019

• Net interest margin for the quarter increased 5 basis points to 3.66 percent compared to Q4 2018 and is 8 basis points higher compared to Q1 2018;  
• Provision for loan losses totaled $250,000 compared to $500,000 for the prior quarter and for the year-ago quarter;
• Efficiency ratio was 56.50 percent compared to 51.02 percent for the linked quarter as result of higher noninterest expenses due to the PBI acquisition and outsized deferred director compensation plan expense as result of exceptionally robust stock market performance during Q1 2019;
• Realized securities losses of $3,000 in Q1 2019 compared to $205,000 in Q4 2018; the Company realized securities gains of $732,000 in Q1 2018;
• Write-downs of foreclosed properties were $249,000 in Q1 2019 compared to $318,000 in Q4 2018, while the net loss on sales of foreclosed properties decreased to $1,000 in Q1 2019 from $70,000 in Q4 2018; and
• Nonperforming assets as a percentage of total assets declined to 1.53 percent compared to 1.66 percent for the linked quarter and to 1.73 percent a year-ago.

H. Charles Maddy, III, President and Chief Executive Officer of Summit, commented, “I am very pleased to report Summit achieved another quarter of solid core operating results highlighted by the improvement in our net interest margin. Further, despite the quarter’s challenges of integrating PBI’s banking operations with that of Summit’s, we nonetheless maintained a core efficiency ratio well below that of most of our peers. We have again demonstrated our ability to successfully execute on a disciplined M&A strategy, which we believe will continue to present us with significant opportunities going forward as we seek to be a consistently growing, high-performing community banking institution.”

Results from Operations

Total revenue for first quarter 2019, consisting of net interest income and noninterest income, increased 3.0 percent to $22.8 million compared to $22.1 million for the first quarter 2018.

For the first quarter of 2019, net interest income increased 7.6 percent to $18.6 million compared to $17.3 million for the prior-year first quarter and grew 2.9 percent compared to the linked quarter principally as a result of $51.6 million in growth in average loans and 7 basis point improvement in average loan yields during the quarter. The net interest margin for first quarter 2019 was 3.66 percent compared to 3.58 percent for the same year-ago quarter, and 3.61 percent for the linked quarter. Excluding the impact of accretion and amortization of fair value acquisition accounting adjustments related to acquired interest earning assets and interest bearing liabilities, Summit’s net interest margin was 3.64 percent for Q1 2019. 

Noninterest income, consisting primarily of insurance commissions from Summit's insurance agency subsidiary, trust and wealth management fees and service fee income from community banking activities, for first quarter 2019 was $4.23 million compared to $4.88 million for the comparable period of 2018. Excluding realized securities gains and losses, noninterest income was $4.23 million for first quarter 2019, compared to $4.14 million reported for first quarter 2018 and $4.39 million for the linked quarter.

We recorded a $250,000 provision for loan losses during first quarter 2019 and $500,000 during Q1 2018.  The decreased need for loan loss provisioning in Q1 2019 is directionally consistent with changes in the credit quality in our loan portfolio (fewer charge-offs) and our modest loan growth.

Q1 2019 total noninterest expense increased 12.6 percent to $13.86 million compared to $12.31 million for the prior-year first quarter and increased 11.2 percent compared to $12.47 million for the linked quarter.  Our increased noninterest expense is principally due to expenses associated with the acquired PBI operations and to an outsized deferred director compensation plan expense of $484,000 recognized in Q1 2019 compared to deferred director compensation plan benefits of ($25,000) and ($354,000) recorded in Q1 2018 and Q4 2018, respectively.  Under our director deferred compensation plans, directors optionally elect to defer their director fees into a "phantom" investment plan whereby the Company recognizes expense or benefit relative to the phantom returns or losses of such investments. As result of the stock market’s exceptionally robust performance during Q1 2019, we recognized significantly greater quarterly deferred director compensation expense this quarter than we have ever recognized previously.

Balance Sheet

At March 31, 2019, total assets were $2.25 billion, an increase of $49.1 million, or 8.9 percent (on an annualized basis) since December 31, 2018. Total loans, net of unearned fees and allowance for loan losses, were $1.73 billion at March 31, 2019, up $43.1 million, or 10.2 percent (on an annualized basis), from the $1.68 billion reported at year-end 2018.  Loans, excluding mortgage warehouse lines of credit and acquired PBI loans, decreased $9.5 million during the quarter, or 2.3 percent (on an annualized basis).

At March 31, 2019, deposits were $1.79 billion, an increase of $154.2 million, or 9.4 percent, since year end 2018. During Q1 2019, checking deposits increased $77.3 million or 10.4 percent, time deposits increased by $53.6 million or 8.9 percent and savings deposits grew $26.5 million or 9.3 percent.

Shareholders’ equity was $233.6 million as of March 31, 2019 compared to $219.8 million at December 31, 2018. In conjunction with the acquisition of PBI on January 1, 2019, Summit issued 465,931 shares of common stock valued at $9.0 million to the former PBI shareholders.

Tangible book value per common share increased to $16.13 at March 31, 2019 compared to $14.36 at the end of first quarter 2018 and $15.75 at year end 2018. Summit had 12,661,528 outstanding common shares at March 31, 2019 compared to 12,312,933 at year end 2018.

As announced in Q3 2018, the Board of Directors authorized the open market repurchase of up to 500,000 shares of the issued and outstanding shares of Summit's common stock.  The timing and quantity of stock purchases under this repurchase plan are at the discretion of management.  The plan will expire December 31, 2019, but may be discontinued, suspended, or restarted at any time at the Company's discretion.  During Q1 2019, 125,200 shares of our common stock were repurchased under the Plan at an average price of $22.95 per share. Through March 31, 2019, the Company has repurchased 207,623 shares under the Plan since its inception at an average price of $21.96 per share.

Asset Quality

As of March 31, 2019, nonperforming assets (“NPAs”), consisting of nonperforming loans, foreclosed properties, and repossessed assets, were $34.4 million, or 1.53 percent of assets. This compares to $36.5 million, or 1.66 percent of assets at the linked quarter-end, and $36.9 million, or 1.73 percent of assets, at first quarter-end 2018 as result of our continuing emphasis on improving our overall asset quality.

First quarter 2019 net loan charge-offs were $165,000, or 0.04 percent of average loans annualized; while adding $250,000 to the allowance for loan losses through the provision for loan losses. The allowance for loan losses stood at 0.76 percent of total loans at March 31, 2019, compared to 0.77 percent at year-end 2018.

About the Company

Summit Financial Group, Inc. is a $2.25 billion financial holding company headquartered in Moorefield, West Virginia. Summit provides community banking services primarily in the Eastern Panhandle and Southern regions of West Virginia and the Northern, Shenandoah Valley and Southwestern regions of Virginia, through its bank subsidiary, Summit Community Bank, Inc., which operates thirty-three 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.

 

SUMMIT FINANCIAL GROUP, INC. (NASDAQ:  SMMF)
Quarterly Performance Summary (unaudited)
Q1 2019 vs Q1 2018
		For the Quarter Ended						Percent
Dollars in thousands		3/31/2019			3/31/2018			Change
Statements of Income
	Interest income
	Loans, including fees	$	23,051			$	20,366		13.2	%
	Securities		2,586				2,391		8.2	%
	Other		231				140		65.0	%
	Total interest income		25,868				22,897		13.0	%
	Interest expense
	Deposits		5,564				3,549		56.8	%
	Borrowings		1,731				2,091		-17.2	%
	Total interest expense		7,295				5,640		29.3	%
	Net interest income		18,573				17,257		7.6	%
	Provision for loan losses		250				500		-50.0	%
	Net interest income after provision
	for loan losses		18,323				16,757		9.3	%
	Noninterest income
	Insurance commissions		1,174				1,113		5.5	%
	Trust and wealth management fees		586				667		-12.1	%
	Service charges on deposit accounts		1,180				1,091		8.2	%
	Bank card revenue		814				749		8.7	%
	Realized securities (losses) gains		(3	)			732		n/a
	Bank owned life insurance income		238				275		-13.5	%
	Other income		241				249		-3.2	%
	Total noninterest income		4,230				4,876		-13.2	%
	Noninterest expense
	Salaries and employee benefits		7,347				6,821		7.7	%
	Net occupancy expense		924				832		11.1	%
	Equipment expense		1,179				1,083		8.9	%
	Professional fees		403				333		21.0	%
	Advertising and public relations		153				103		48.5	%
	Amortization of intangibles		476				436		9.2	%
	FDIC premiums		-				240		n/a
	Bank card expense		439				335		31.0	%
	Foreclosed properties expense, net of losses		384				325		18.2	%
	Merger-related expense		63				-		n/a
	Other expenses		2,492				1,806		38.0	%
	Total noninterest expense		13,860				12,314		12.6	%
	Income before income taxes		8,693				9,319		-6.7	%
	Income taxes		1,601				1,876		-14.7	%
	Net income	$	7,092			$	7,443		-4.7	%

SUMMIT FINANCIAL GROUP, INC. (NASDAQ:  SMMF)
Quarterly Performance Summary (unaudited)
Q1 2019 vs Q1 2018
		For the Quarter Ended						Percent
		3/31/2019			3/31/2018			Change
Per Share Data
	Earnings per common share
	Basic	$	0.56		$	0.60		-6.7	%
	Diluted	$	0.56		$	0.60		-7.5	%
	Cash dividends	$	0.14		$	0.13		7.7	%
	Average common shares outstanding
	Basic		12,717,501			12,358,849		2.9	%
	Diluted		12,778,644			12,383,757		3.2	%
	Common shares outstanding at period end		12,661,528			12,366,360		2.4	%
Performance Ratios
	Return on average equity		12.28	%		14.73	%	-16.6	%
	Return on average tangible equity		14.80	%		17.04	%	-13.1	%
	Return on average assets		1.27	%		1.40	%	-9.3	%
	Net interest margin (A)		3.66	%		3.58	%	2.2	%
	Efficiency ratio (B)		56.50	%		53.84	%	4.9	%

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

NOTE (B) – Computed on a tax equivalent basis excluding gains/losses on sales of assets, write-downs of OREO properties to fair value and amortization of intangibles. 

SUMMIT FINANCIAL GROUP, INC. (NASDAQ:  SMMF)
Five Quarter Performance Summary (unaudited)
		For the Quarter Ended
Dollars in thousands		3/31/2019			12/31/2018				9/30/2018			6/30/2018			3/31/2018
Statements of Income
	Interest income
	Loans, including fees	$	23,051			$	22,659			$	21,295		$	20,962		$	20,366
	Securities		2,586				2,527				2,367			2,303			2,391
	Other		231				127				138			134			140
	Total interest income		25,868				25,313				23,800			23,399			22,897
	Interest expense
	Deposits		5,564				5,103				4,714			4,309			3,549
	Borrowings		1,731				2,158				1,873			1,815			2,091
	Total interest expense		7,295				7,261				6,587			6,124			5,640
	Net interest income		18,573				18,052				17,213			17,275			17,257
	Provision for loan losses		250				500				500			750			500
	Net interest income after provision
	for loan losses		18,323				17,552				16,713			16,525			16,757
	Noninterest income
	Insurance commissions		1,174				1,132				1,062			1,013			1,113
	Trust and wealth management fees		586				627				687			672			667
	Service charges on deposit accounts		1,180				1,209				1,215			1,116			1,091
	Bank card revenue		814				809				793			801			749
	Realized securities (losses) gains		(3	)			(205	)			8			87			732
	Bank owned life insurance income		238				248				250			249			275
	Other income		241				367				196			210			249
	Total noninterest income		4,230				4,187				4,211			4,148			4,876
	Noninterest expense
	Salaries and employee benefits		7,347				6,928				6,806			6,922			6,821
	Net occupancy expense		924				836				856			840			832
	Equipment expense		1,179				1,139				1,118			1,071			1,083
	Professional fees		403				385				503			385			333
	Advertising and public relations		153				193				170			188			103
	Amortization of intangibles		476				410				413			413			436
	FDIC premiums		-				140				210			240			240
	Bank card expense		439				395				384			361			335
	Foreclosed properties expense, net of losses		384				507				169			350			325
	Merger-related expense		63				59				86			-			-
	Other expenses		2,492				1,474				1,643			1,965			1,806
	Total noninterest expense		13,860				12,466				12,358			12,735			12,314
	Income before income taxes		8,693				9,273				8,566			7,938			9,319
	Income tax expense		1,601				1,823				1,667			1,658			1,876
	Net income	$	7,092			$	7,450			$	6,899		$	6,280		$	7,443

 

SUMMIT FINANCIAL GROUP, INC. (NASDAQ:  SMMF)
Five Quarter Performance Summary (unaudited)
		For the Quarter Ended
		3/31/2019			12/31/2018			9/30/2018			6/30/2018			3/31/2018
Per Share Data
	Earnings per common share
	Basic	$	0.56		$	0.60		$	0.56		$	0.51		$	0.60
	Diluted	$	0.56		$	0.60		$	0.55		$	0.51		$	0.60
	Cash dividends	$	0.14		$	0.14		$	0.13		$	0.13		$	0.13
	Average common shares outstanding
	Basic		12,717,501			12,358,104			12,374,350			12,366,522			12,358,849
	Diluted		12,778,644			12,407,678			12,439,051			12,431,984			12,383,757
	Common shares outstanding at period end		12,661,528			12,312,933			12,382,450			12,373,747			12,366,360
Performance Ratios
	Return on average equity		12.28	%		13.85	%		13.00	%		12.16	%		14.73	%
	Return on average tangible equity		14.80	%		16.41	%		15.53	%		14.68	%		17.80	%
	Return on average assets		1.27	%		1.38	%		1.31	%		1.19	%		1.40	%
	Net interest margin (A)		3.66	%		3.61	%		3.53	%		3.58	%		3.58	%
	Efficiency ratio (B)		56.50	%		51.02	%		54.25	%		55.88	%		53.84	%

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

NOTE (B) – Computed on a tax equivalent basis excluding gains/losses on sales of assets, write-downs of OREO properties to fair value and amortization of intangibles. 

SUMMIT FINANCIAL GROUP, INC. (NASDAQ:  SMMF)
Selected Balance Sheet Data (unaudited)
Dollars in thousands, except per share amounts		3/31/2019			12/31/2018				9/30/2018				6/30/2018				3/31/2018
Assets
	Cash and due from banks	$	14,265			$	23,061			$	9,382			$	8,314			$	9,042
	Interest bearing deposits other banks		43,689				36,479				44,452				38,097				38,365
	Securities		297,126				293,284				288,040				283,221				296,890
	Loans, net		1,725,064				1,682,005				1,632,747				1,617,373				1,631,150
	Property held for sale		24,393				21,432				22,017				21,606				21,442
	Premises and equipment, net		39,345				37,553				36,888				36,017				35,554
	Goodwill and other intangible assets		29,349				25,842				26,252				26,665				27,077
	Cash surrender value of life insurance policies		42,714				42,420				42,208				41,932				41,668
	Other assets		33,696				38,510				36,741				34,427				33,707
	Total assets	$	2,249,641			$	2,200,586			$	2,138,727			$	2,107,652			$	2,134,895
Liabilities and Shareholders' Equity
	Deposits	$	1,789,032			$	1,634,826			$	1,651,064			$	1,639,996			$	1,654,523
	Short-term borrowings		186,292				309,084				238,403				202,429				193,513
	Long-term borrowings and
	subordinated debentures		20,319				20,324				20,328				40,332				65,336
	Other liabilities		20,368				16,522				15,376				15,016				16,514
	Shareholders' equity		233,630				219,830				213,556				209,879				205,009
	Total liabilities and shareholders' equity	$	2,249,641			$	2,200,586			$	2,138,727			$	2,107,652			$	2,134,895
	Book value per common share	$	18.45			$	17.85			$	17.25			$	16.96			$	16.55
	Tangible book value per common share	$	16.13			$	15.75			$	15.13			$	14.81			$	14.36
	Tangible common equity to tangible assets		9.2	%			8.9	%			8.9	%			8.8	%			8.4	%

 

 

SUMMIT FINANCIAL GROUP INC. (NASDAQ:  SMMF)
Regulatory Capital Ratios (unaudited)
		3/31/2019		12/31/2018		9/30/2018		6/30/2018		3/31/2018
Summit Financial Group, Inc.
	CET1 Risk-based Capital	11.4	%	11.1	%	11.1	%	11.0	%	10.7	%
	Tier 1 Risk-based Capital	12.5	%	12.2	%	12.2	%	12.1	%	11.8	%
	Total Risk-based Capital	13.2	%	12.9	%	12.9	%	12.8	%	12.5	%
	Tier 1 Leverage	10.2	%	10.1	%	10.1	%	9.9	%	9.5	%
Summit Community Bank, Inc.
	CET1 Risk-based Capital	12.3	%	12.0	%	12.0	%	12.0	%	11.7	%
	Tier 1 Risk-based Capital	12.3	%	12.0	%	12.0	%	12.0	%	11.7	%
	Total Risk-based Capital	13.0	%	12.8	%	12.7	%	12.8	%	12.5	%
	Tier 1 Leverage	10.0	%	10.0	%	9.9	%	9.8	%	9.5	%

 

SUMMIT FINANCIAL GROUP INC. (NASDAQ:  SMMF)
Loan Composition (unaudited)
Dollars in thousands		3/31/2019		12/31/2018			9/30/2018			6/30/2018			3/31/2018
Commercial		$	189,248		$	194,315		$	167,972		$	171,410		$	189,586
Mortgage warehouse lines			49,355			39,140			35,910			54,332			45,702
Commercial real estate
Owner occupied			272,088			266,362			272,475			262,174			265,075
Non-owner occupied			570,392			564,826			530,568			503,047			498,445
Construction and development
Land and development			64,192			68,833			71,819			74,018			66,841
Construction			36,040			24,731			25,703			25,711			33,327
Residential real estate
Non-jumbo			359,107			336,977			340,783			343,044			346,477
Jumbo			69,313			73,599			72,327			66,831			67,169
Home equity			80,370			80,910			82,018			82,409			83,382
Consumer			36,046			32,460			33,664			34,249			34,825
Other			12,045			12,899			12,452			12,728			12,578
Total loans, net of unearned fees			1,738,196			1,695,052			1,645,691			1,629,953			1,643,407
Less allowance for loan losses			13,132			13,047			12,944			12,580			12,257
Loans, net		$	1,725,064		$	1,682,005		$	1,632,747		$	1,617,373		$	1,631,150

 

SUMMIT FINANCIAL GROUP INC. (NASDAQ:  SMMF)
Deposit Composition (unaudited)
Dollars in thousands		3/31/2019		12/31/2018			9/30/2018			6/30/2018			3/31/2018
Core deposits
Non-interest bearing checking		$	258,679		$	222,120		$	232,697		$	217,134		$	219,293
Interest bearing checking			560,800			523,257			505,411			472,041			447,172
Savings			310,646			284,173			301,269			322,940			346,962
Time deposits			359,141			316,914			316,941			322,801			318,556
Total core deposits			1,489,266			1,346,464			1,356,318			1,334,916			1,331,983
Brokered time deposits			218,913			220,497			227,312			238,662			242,049
Other non-core time deposits			80,852			67,866			67,434			66,418			80,491
Total deposits		$	1,789,031		$	1,634,827		$	1,651,064		$	1,639,996		$	1,654,523

 

SUMMIT FINANCIAL GROUP, INC. (NASDAQ:  SMMF)
Asset Quality Information (unaudited)
		For the Quarter Ended
Dollars in thousands		3/31/2019			12/31/2018				9/30/2018				6/30/2018				3/31/2018
	Gross loan charge-offs	$	414			$	705			$	413			$	525			$	960
	Gross loan recoveries		(249	)			(307	)			(278	)			(97	)			(153	)
	Net loan charge-offs (recoveries)	$	165			$	398			$	135			$	428			$	807
	Net loan charge-offs to average loans (annualized)		0.04	%			0.10	%			0.03	%			0.10	%			0.20	%
	Allowance for loan losses	$	13,132			$	13,047			$	12,944			$	12,580			$	12,257
	Allowance for loan losses as a percentage
	of period end loans		0.76	%			0.77	%			0.79	%			0.77	%			0.75	%
	Nonperforming assets:
	Nonperforming loans
	Commercial	$	729			$	935			$	801			$	954			$	734
	Commercial real estate		2,981				3,239				5,090				3,238				3,400
	Residential construction and development		24				3,198				3,200				3,233				3,642
	Residential real estate		5,928				7,506				7,760				8,241				7,521
	Consumer		182				147				118				110				160
	Other		130				-				-				-				-
	Total nonperforming loans		9,974				15,025				16,969				15,776				15,457
	Foreclosed properties
	Commercial real estate		1,841				1,762				1,762				1,818				1,875
	Commercial construction and development		6,326				6,479				6,790				6,815				7,140
	Residential construction and development		14,347				11,543				11,614				11,517				11,053
	Residential real estate		1,879				1,648				1,851				1,456				1,374
	Total foreclosed properties		24,393				21,432				22,017				21,606				21,442
	Other repossessed assets		34				5				5				12				18
	Total nonperforming assets	$	34,401			$	36,462			$	38,991			$	37,394			$	36,917
	Nonperforming loans to period end loans		0.57	%			0.89	%			1.03	%			0.97	%			0.94	%
	Nonperforming assets to period end assets		1.53	%			1.66	%			1.82	%			1.77	%			1.73	%
	Troubled debt restructurings
	Performing	$	27,845			$	26,609			$	27,441			$	27,559			$	27,408
	Nonperforming		-				388				113				281				76
	Total troubled debt restructurings	$	27,845			$	26,997			$	27,554			$	27,840			$	27,484

 

Loans Past Due 30-89 Days (unaudited)
		For the Quarter Ended
Dollars in thousands		3/31/2019		12/31/2018			9/30/2018			6/30/2018			3/31/2018
	Commercial	$	264		$	219		$	607		$	319		$	539
	Commercial real estate		4,128			161			988			546			601
	Construction and development		179			194			393			264			174
	Residential real estate		2,944			6,249			5,513			4,125			5,218
	Consumer		432			593			345			337			425
	Other		52			38			11			8			15
	Total	$	7,999		$	7,454		$	7,857		$	5,599		$	6,972

 

SUMMIT FINANCIAL GROUP, INC. (NASDAQ:  SMMF)
Average Balance Sheet, Interest Earnings & Expenses and Average Rates
Q1 2019 vs Q4 2018 vs Q1 2018 (unaudited)
	Q1 2019										Q4 2018										Q1 2018
	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	$	1,712,286			$	22,907		5.43	%		$	1,660,250			$	22,519		5.38	%		$	1,611,813			$	20,223		5.09	%
Tax-exempt (2)		14,907				184		5.01	%			15,322				177		4.58	%			16,307				182		4.53	%
Securities
Taxable		195,932				1,687		3.49	%			176,059				1,502		3.38	%			191,713				1,372		2.90	%
Tax-exempt (2)		114,831				1,139		4.02	%			132,088				1,296		3.89	%			132,306				1,290		3.95	%
Interest bearing deposits other banks
and Federal funds sold		51,187				230		1.82	%			35,402				127		1.42	%			39,656				140		1.43	%
Total interest earning assets		2,089,143				26,147		5.08	%			2,019,121				25,621		5.03	%			1,991,795				23,207		4.73	%
Noninterest earning assets
Cash & due from banks		12,825										9,686										9,962
Premises & equipment		38,834										37,224										34,586
Other assets		112,910										109,228										107,125
Allowance for loan losses		(13,309	)									(13,172	)									(12,737	)
Total assets	$	2,240,403									$	2,162,087									$	2,130,731
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Interest bearing liabilities
Interest bearing
demand deposits	$	556,766			$	1,663		1.21	%		$	519,465			$	1,504		1.15	%		$	423,095			$	632		0.61	%
Savings deposits		310,848				898		1.17	%			289,809				861		1.18	%			346,358				717		0.84	%
Time deposits		654,404				3,003		1.86	%			607,037				2,738		1.79	%			622,543				2,200		1.43	%
Short-term borrowings		200,297				1,472		2.98	%			270,092				1,909		2.80	%			243,686				1,405		2.34	%
Long-term borrowings and
subordinated debentures		20,321				259		5.17	%			20,326				249		4.86	%			65,338				686		4.26	%
Total interest bearing liabilities		1,742,636				7,295		1.70	%			1,706,729				7,261		1.69	%			1,701,020				5,640		1.34	%
Noninterest bearing liabilities
Demand deposits		248,354										223,999										210,883
Other liabilities		18,322										16,138										16,771
Total liabilities		2,009,312										1,946,866										1,928,674
Shareholders' equity - common		231,091										215,221										202,057
Total liabilities and
shareholders' equity	$	2,240,403									$	2,162,087									$	2,130,731
NET INTEREST EARNINGS					$	18,852									$	18,360									$	17,567
NET INTEREST MARGIN								3.66	%									3.61	%									3.58	%
(1)  For purposes of this table, nonaccrual loans are included in average loan balances.
(2)  For purposes of this table, interest income on tax-exempt securities and loans has been adjusted assuming a Federal tax rate of 21%.  The taxable equivalent adjustment results in an increase in interest income of  $279,000, $309,000 and $310,000 for Q1 2019, Q4 2018 and Q1 2018, respectively.

Contact:          Robert S. Tissue, Sr. Vice President & CFO
Telephone:        (304) 530-0552
Email:            rtissue@summitfgi.com