MOOREFIELD, W.Va., Jan. 28, 2015 (GLOBE NEWSWIRE) -- Summit Financial Group, Inc. ("Company" or "Summit") (Nasdaq:SMMF) today reported fourth quarter 2014 net income applicable to common shares of $3.01 million, or $0.32 per diluted share, compared to $2.59 million, or $0.29 per diluted share, for the fourth quarter of 2013, representing an increase of 16.0 percent, or 10.3 percent per diluted share. Q4 2014 earnings compared to Q4 2013 were positively impacted by a $948,000 increase in net interest income and a $1.0 million decline in provision for loan losses, but were negatively impacted by a $686,000 increase in noninterest expense, which included a fraud loss of $461,000.
Excluding from fourth quarter 2014 (on a pre-tax basis) realized securities gains of $149,000, losses on sales of foreclosed properties of $628,000, write-downs of foreclosed properties of $300,000 and the $461,000 fraud loss, Q4 2014 core earnings approximated $3.79 million, or $0.40 per diluted share. Excluding from Q4 2013 (on a pre-tax basis) realized securities gains of $124,000, gains on sales of foreclosed properties of $28,000, and write-downs of foreclosed properties of $644,000, Q4 2013 core earnings approximated $2.90 million, or $0.32 per diluted share.
For the year ended December 31, 2014, Summit recorded net income applicable to common shares of $10.59 million, or $1.17 per diluted share, compared with $7.29 million, or $0.84 per diluted share, for 2013, representing an increase of 45.1%, or 39.3% per diluted share.
Excluding from the full-year 2014 nonrecurring items (on a pre-tax basis) comprised of realized securities gains of $213,000, losses on sales of foreclosed properties of $827,000, OTTI charges of $1,000 and write-downs of foreclosed properties of $3.77 million, and from the 2013 full year realized securities gains of $240,000, losses on sale of foreclosed properties of $518,000, OTTI charges of $118,000 and write-downs of foreclosed properties of $3.72 million, core earnings for full-year 2014 were approximately $13.64 million, or $1.50 per diluted share, compared to $9.89 million, or $1.12 per diluted share, for full-year 2013.
Highlights for Q4 2014 include:
-
Nonperforming assets declined for the twelfth consecutive quarter. Compared to the linked quarter, nonperforming assets as a percentage of total assets declined from 4.10 percent to 3.48 percent, reaching its lowest level since Q2 2008; foreclosed properties are at the lowest level since Q3 2009.
-
Net interest margin declined 5 basis points compared to the linked quarter, but has increased 18 basis points since Q4 2013.
-
Achieved loan growth of $26.6 million, or 2.7 percent (non-annualized) during Q4 2014, and $81.3 million, or 8.6 percent during 2014.
-
Recorded charges of $300,000 to write-down foreclosed properties compared to $1.58 million in Q3 2014 and $644,000 in Q4 2013.
- Summit's regulatory capital ratios are at the highest levels in fourteen years.
H. Charles Maddy III, President and Chief Executive Officer of Summit, commented, "The year just concluded marked a milestone of Summit's recovery from the effects of the economic downturn of the last decade. Our earnings improvements, growing loan portfolio, increasing revenues, improved net interest earnings, strengthened capital, reductions in our portfolio of problem assets and the recent lifting of regulatory memorandum, all serve as evidence of achievement of this goal. Further, we are very pleased to end 2014 with another quarter of solid performance, which gives us optimism as we look forward to 2015 and beyond."
Results from Operations
Total revenue for fourth quarter 2014, consisting of net interest income and noninterest income, grew 6.8 percent to $13.8 million compared to $12.9 million for the fourth quarter 2013. For the year-to-date period ended December 31, 2014, total revenue was $53.6 million compared to $50.0 million for 2013, representing a 7.2 percent increase.
Total core revenue (excluding nonrecurring items, enumerated above) was $13.6 million for fourth quarter 2014 compared to $12.8 million for the same prior-year quarter, an increase of 6.6 percent. For full-year 2014, total core revenue (excluding nonrecurring items) was $53.4 million compared to $49.9 million for full-year 2013, a 7.0 percent improvement.
For the fourth quarter of 2014, net interest income was $11.0 million, an increase of 9.5 percent from the $10.0 million reported in the prior-year fourth quarter and decreased $126,000 compared to the linked quarter. The net interest margin for fourth quarter 2014 was 3.42 percent compared to 3.24 percent for the year-ago quarter, and 3.47 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 fourth quarter 2014 was $2.82 million compared to $2.90 million for the comparable period of 2013. Excluding realized securities gains/losses and OTTI of securities, noninterest income was $2.67 million for fourth quarter 2014, compared to $2.77 million reported for fourth quarter 2013.
Summit recognized no provision for loan losses in fourth quarter 2014, compared to $250,000 for the linked quarter and $1.0 million for the year-ago quarter.
Core noninterest expense continues to be well-controlled. Total noninterest expense increased 8.1% to $9.11 million compared to $8.42 million for the prior-year fourth quarter. Excluding from noninterest expense (on a pre-tax basis) losses on sales of foreclosed properties of $628,000 in Q4 2014 and gains of $28,000 in Q4 2013, write-downs of foreclosed properties of $300,000 in Q4 2014 and $644,000 in Q4 2013, and a fraud loss in Q4 2014 of $461,000, noninterest expense would have approximated $7.72 million for Q4 2014 compared to $7.81 million for the comparable period of 2013. Noninterest expense for the full-year 2014 increased 1.6% compared to 2013.
Balance Sheet
At December 31, 2014, total assets were $1.44 billion, an increase of $57.3 million, or 4.1 percent since December 31, 2013. Total loans, net of unearned fees and allowance for loan losses, were $1.02 billion at December 31, 2014, up $82.8 million, or 8.8 percent, from the $937.1 million reported at year-end 2013.
At December 31, 2014, deposits were $1.06 billion, an increase of $57.5 million, or 5.7 percent, since year end 2013. During 2014, checking and savings grew by $40.0 million and $60.1 million, respectively, or 14.3 percent and 31.1 percent, respectively. Long-term borrowings and subordinated debentures declined by 43.0 percent since year end 2013, as the Company paid down $86.0 million in maturing borrowings, which was funded by growth in checking and savings deposits and short-term borrowings.
Asset Quality
As of December 31, 2014, nonperforming assets ("NPAs"), consisting of nonperforming loans, foreclosed properties, and repossessed assets, were $50.2 million, or 3.48 percent of assets. This compares to $58.5 million, or 4.10 percent of assets at the linked quarter, and $72.3 million, or 5.22 percent of assets, at fourth quarter 2013.
Fourth quarter 2014 net loan recoveries were $126,000, or 0.05 percent of average loans annualized. The allowance for loan losses stood at $11.2 million, or 1.08 percent of total loans at December 31, 2014, compared to 1.33 percent at year-end 2013.
Capital Adequacy
Shareholders' equity was $131.6 million as of December 31, 2014 compared to $111.1 million December 31, 2013. Tangible book value per common share increased to $11.86 at December 31, 2014 compared to $10.72 at December 31, 2013.
Summit's depository institution, Summit Community Bank, Inc. (the "Bank"), is well in excess of regulatory requirements for a "well capitalized" institution at December 31, 2014. The Bank's total risk-based capital ratio was 15.3 percent at December 31, 2014 compared to 15.7 percent at December 31, 2013, while its Tier 1 leverage capital ratio improved to 10.6 percent from the 10.4 percent reported at December 31, 2013.
About the Company
Summit Financial Group, Inc. is a $1.44 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 deems 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 -- Q4 2014 vs Q4 2013 | |||
| For the Quarter Ended | Percent | ||
| Dollars in thousands | 12/31/2014 | 12/31/2013 | Change |
| Condensed Statements of Income | |||
| Interest income | |||
| Loans, including fees | $ 12,666 | $ 12,507 | 1.3% |
| Securities | 1,784 | 1,850 | -3.6% |
| Other | 2 | 2 | 0.0% |
| Total interest income | 14,452 | 14,359 | 0.6% |
| Interest expense | |||
| Deposits | 2,130 | 2,317 | -8.1% |
| Borrowings | 1,371 | 2,039 | -32.8% |
| Total interest expense | 3,501 | 4,356 | -19.6% |
| Net interest income | 10,951 | 10,003 | 9.5% |
| Provision for loan losses | - | 1,000 | -100.0% |
| Net interest income after provision for loan losses | 10,951 | 9,003 | 21.6% |
| Noninterest income | |||
| Insurance commissions | 1,023 | 1,056 | -3.1% |
| Service fees related to deposit accounts | 1,113 | 1,124 | -1.0% |
| Realized securities gains (losses) | 149 | 124 | 20.2% |
| Other-than-temporary impairment of securities | - | - | n/a |
| Other income | 537 | 592 | -9.3% |
| Total noninterest income | 2,822 | 2,896 | -2.6% |
| Noninterest expense | |||
| Salaries and employee benefits | 4,133 | 4,024 | 2.7% |
| Net occupancy expense | 495 | 466 | 6.2% |
| Equipment expense | 487 | 580 | -16.0% |
| Professional fees | 452 | 295 | 53.2% |
| FDIC premiums | 315 | 502 | -37.3% |
| Foreclosed properties expense | 239 | 209 | 14.4% |
| Loss (gain) on sales of foreclosed properties | 628 | (28) | -2342.9% |
| Write-downs of foreclosed properties | 300 | 644 | -53.4% |
| Other expenses | 2,061 | 1,732 | 19.0% |
| Total noninterest expense | 9,110 | 8,424 | 8.1% |
| Income before income taxes | 4,663 | 3,475 | 34.2% |
| Income taxes | 1,464 | 687 | 113.1% |
| Net income | 3,199 | 2,788 | 14.7% |
| Preferred stock dividends | 191 | 194 | -1.5% |
| Net income applicable to common shares | $ 3,008 | $ 2,594 | 16.0% |
| SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF) | |||
| Quarterly Performance Summary -- Q4 2014 vs Q4 2013 | |||
| For the Quarter Ended | Percent | ||
| 12/31/2014 | 12/31/2013 | Change | |
| Per Share Data | |||
| Earnings per common share | |||
| Basic | $ 0.39 | $ 0.35 | 11.4% |
| Diluted | $ 0.32 | $ 0.29 | 10.3% |
| Average shares outstanding | |||
| Basic | 7,796,508 | 7,450,379 | 4.6% |
| Diluted | 9,963,214 | 9,624,312 | 3.5% |
| Performance Ratios | |||
| Return on average equity (A) | 10.10% | 10.15% | -0.5% |
| Return on average assets | 0.89% | 0.80% | 11.3% |
| Net interest margin | 3.42% | 3.24% | 5.6% |
| Efficiency ratio (B) | 53.07% | 57.31% | -7.4% |
| NOTE (A) – Net income divided by total shareholders' equity. | |||
| NOTE (B) – Computed on a tax equivalent basis excluding nonrecurring income and expense items and amortization of intangibles. | |||
| SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF) | |||
| Annual Performance Summary -- 2014 vs 2013 | |||
| For the Years Ended | Percent | ||
| Dollars in thousands | 12/31/2014 | 12/31/2013 | Change |
| Condensed Statements of Income | |||
| Interest income | |||
| Loans, including fees | $ 50,430 | $ 50,741 | -0.6% |
| Securities | 7,188 | 6,534 | 10.0% |
| Other | 8 | 5 | 60.0% |
| Total interest income | 57,626 | 57,280 | 0.6% |
| Interest expense | |||
| Deposits | 8,995 | 10,392 | -13.4% |
| Borrowings | 6,246 | 8,085 | -22.7% |
| Total interest expense | 15,241 | 18,477 | -17.5% |
| Net interest income | 42,385 | 38,803 | 9.2% |
| Provision for loan losses | 2,250 | 4,500 | -50.0% |
| Net interest income after provision for loan losses | 40,135 | 34,303 | 17.0% |
| Noninterest income | |||
| Insurance commissions | 4,400 | 4,429 | -0.7% |
| Service fees related to deposit accounts | 4,405 | 4,325 | 1.8% |
| Realized securities gains | 213 | 240 | -11.3% |
| Other-than-temporary impairment of securities | (1) | (118) | -99.2% |
| Other income | 2,206 | 2,333 | -5.4% |
| Total noninterest income | 11,223 | 11,209 | 0.1% |
| Noninterest expense | |||
| Salaries and employee benefits | 16,185 | 16,178 | 0.0% |
| Net occupancy expense | 2,023 | 1,853 | 9.2% |
| Equipment expense | 2,086 | 2,303 | -9.4% |
| Professional fees | 1,429 | 1,181 | 21.0% |
| FDIC premiums | 1,792 | 2,060 | -13.0% |
| Foreclosed properties expense | 1,020 | 1,045 | -2.4% |
| Loss (gain) on sales of foreclosed properties | 827 | 518 | 59.7% |
| Write-downs of foreclosed properties | 3,771 | 3,722 | 1.3% |
| Other expenses | 6,191 | 5,896 | 5.0% |
| Total noninterest expense | 35,324 | 34,756 | 1.6% |
| Income before income taxes | 16,034 | 10,756 | 49.1% |
| Income taxes | 4,678 | 2,688 | 74.0% |
| Net income | 11,356 | 8,068 | 40.8% |
| Preferred stock dividends | 771 | 775 | -0.5% |
| Net income applicable to common shares | $ 10,585 | $ 7,293 | 45.1% |
| SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF) | |||
| Annual Performance Summary -- 2014 vs 2013 | |||
| For the Years Ended | Percent | ||
| 12/31/2014 | 12/31/2013 | Change | |
| Per Share Data | |||
| Earnings per common share | |||
| Basic | $ 1.40 | $ 0.98 | 42.9% |
| Diluted | $ 1.17 | $ 0.84 | 39.3% |
| Average shares outstanding | |||
| Basic | 7,539,444 | 7,442,689 | 1.3% |
| Diluted | 9,711,561 | 9,621,504 | 0.9% |
| Performance Ratios | |||
| Return on average equity (A) | 9.54% | 7.38% | 29.3% |
| Return on average assets | 0.80% | 0.58% | 37.9% |
| Net interest margin | 3.39% | 3.22% | 5.3% |
| Efficiency ratio (B) | 52.78% | 56.48% | -6.6% |
| NOTE (A) – Net income divided by total average shareholders' equity. | |||
| NOTE (B) – 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 | 12/31/2014 | 9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 |
| Condensed Statements of Income | |||||
| Interest income | |||||
| Loans, including fees | $ 12,666 | $ 13,033 | $ 12,515 | $ 12,216 | $ 12,507 |
| Securities | 1,784 | 1,724 | 1,827 | 1,852 | 1,850 |
| Other | 2 | 3 | 2 | 2 | 2 |
| Total interest income | 14,452 | 14,760 | 14,344 | 14,070 | 14,359 |
| Interest expense | |||||
| Deposits | 2,130 | 2,288 | 2,335 | 2,241 | 2,317 |
| Borrowings | 1,371 | 1,395 | 1,689 | 1,791 | 2,039 |
| Total interest expense | 3,501 | 3,683 | 4,024 | 4,032 | 4,356 |
| Net interest income | 10,951 | 11,077 | 10,320 | 10,038 | 10,003 |
| Provision for loan losses | - | 250 | 1,000 | 1,000 | 1,000 |
| Net interest income after provision for loan losses | 10,951 | 10,827 | 9,320 | 9,038 | 9,003 |
| Noninterest income | |||||
| Insurance commissions | 1,023 | 1,105 | 1,091 | 1,181 | 1,056 |
| Service fees related to deposit accounts | 1,113 | 1,177 | 1,101 | 1,043 | 1,124 |
| Realized securities gains (losses) | 149 | 128 | (43) | (22) | 124 |
| Other-than-temporary impairment of securities | - | - | (1) | - | - |
| Other income | 537 | 503 | 557 | 581 | 592 |
| Total noninterest income | 2,822 | 2,913 | 2,705 | 2,783 | 2,896 |
| Noninterest expense | |||||
| Salaries and employee benefits | 4,133 | 4,026 | 4,045 | 3,980 | 4,024 |
| Net occupancy expense | 495 | 482 | 505 | 541 | 466 |
| Equipment expense | 487 | 520 | 513 | 566 | 580 |
| Professional fees | 452 | 380 | 282 | 316 | 295 |
| FDIC premiums | 315 | 480 | 495 | 502 | 502 |
| Foreclosed properties expense | 239 | 298 | 229 | 254 | 209 |
| Loss (gain) on sale of foreclosed properties | 628 | 70 | 54 | 75 | (28) |
| Write-downs of foreclosed properties | 300 | 1,580 | 962 | 928 | 644 |
| Other expenses | 2,061 | 1,350 | 1,445 | 1,336 | 1,732 |
| Total noninterest expense | 9,110 | 9,186 | 8,530 | 8,498 | 8,424 |
| Income before income taxes | 4,663 | 4,554 | 3,495 | 3,323 | 3,475 |
| Income taxes | 1,464 | 1,218 | 1,063 | 934 | 687 |
| Net income | 3,199 | 3,336 | 2,432 | 2,389 | 2,788 |
| Preferred stock dividends | 191 | 193 | 193 | 194 | 194 |
| Net income applicable to common shares | $ 3,008 | $ 3,143 | $ 2,239 | $ 2,195 | $ 2,594 |
| SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF) | |||||
| Five Quarter Performance Summary | |||||
| For the Quarter Ended | |||||
| 12/31/2014 | 9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 | |
| Per Share Data | |||||
| Earnings per common share | |||||
| Basic | $ 0.39 | $ 0.42 | $ 0.30 | $ 0.29 | $ 0.35 |
| Diluted | $ 0.32 | $ 0.35 | $ 0.25 | $ 0.25 | $ 0.29 |
| Average shares outstanding | |||||
| Basic | 7,796,508 | 7,457,222 | 7,457,222 | 7,453,370 | 7,450,379 |
| Diluted | 9,963,214 | 9,630,293 | 9,630,699 | 9,628,927 | 9,624,312 |
| Performance Ratios | |||||
| Return on average equity (A) | 10.10% | 11.13% | 8.37% | 8.46% | 10.15% |
| Return on average assets | 0.89% | 0.93% | 0.69% | 0.69% | 0.80% |
| Net interest margin | 3.42% | 3.47% | 3.32% | 3.33% | 3.24% |
| Efficiency ratio - (B) | 53.07% | 51.19% | 52.86% | 54.13% | 57.31% |
| NOTE (A) – Net income divided by average total shareholders' equity. | |||||
| NOTE (B) – 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 | 12/31/2014 | 9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 |
| Assets | |||||
| Cash and due from banks | $ 3,728 | $ 3,933 | $ 3,749 | $ 3,827 | $ 3,442 |
| Interest bearing deposits other banks | 8,783 | 9,300 | 9,970 | 13,424 | 8,340 |
| Securities | 282,834 | 282,401 | 287,883 | 281,865 | 288,780 |
| Loans, net | 1,019,842 | 993,347 | 992,816 | 962,714 | 937,070 |
| Property held for sale | 37,529 | 47,252 | 48,783 | 52,241 | 53,392 |
| Premises and equipment, net | 20,060 | 20,132 | 20,301 | 20,457 | 20,623 |
| Intangible assets | 7,698 | 7,748 | 7,798 | 7,861 | 7,949 |
| Cash surrender value of life insurance policies | 36,700 | 36,417 | 36,151 | 35,881 | 35,611 |
| Other assets | 26,394 | 28,139 | 28,507 | 27,847 | 31,020 |
| Total assets | $ 1,443,568 | $ 1,428,669 | $ 1,435,958 | $ 1,406,117 | $ 1,386,227 |
| Liabilities and Shareholders' Equity | |||||
| Deposits | $ 1,061,314 | $ 1,054,454 | $ 1,057,795 | $ 1,052,630 | $ 1,003,812 |
| Short-term borrowings | 123,633 | 127,432 | 91,729 | 68,974 | 62,769 |
| Long-term borrowings and subordinated debentures | 113,879 | 114,855 | 158,331 | 159,881 | 199,905 |
| Other liabilities | 13,098 | 10,566 | 10,638 | 10,105 | 8,669 |
| Shareholders' equity | 131,644 | 121,362 | 117,465 | 114,527 | 111,072 |
| Total liabilities and shareholders' equity | $ 1,443,568 | $ 1,428,669 | $ 1,435,958 | $ 1,406,117 | $ 1,386,227 |
| Book value per common share (A) | $ 12.60 | $ 12.62 | $ 12.21 | $ 11.91 | $ 11.55 |
| Tangible book value per common share (A) | $ 11.86 | $ 11.81 | $ 11.40 | $ 11.09 | $ 10.72 |
| Tangible equity / Tangible assets | 8.6% | 8.0% | 7.7% | 7.6% | 7.5% |
| NOTE (A) – Assumes conversion of convertible preferred stock | |||||
| SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF) | |||||
| Regulatory Capital Ratios | |||||
| 12/31/2014 | 9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 | |
| Summit Financial Group, Inc. | |||||
| Total Risk Based Capital | 14.9% | 14.3% | 14.2% | 14.2% | 14.5% |
| Tier 1 Risk-based Capital | 13.3% | 12.5% | 12.4% | 12.4% | 12.4% |
| Tier 1 Leverage Ratio | 9.9% | 9.2% | 9.0% | 9.0% | 8.9% |
| Summit Community Bank, Inc. | |||||
| Total Risk Based Capital | 15.3% | 15.5% | 15.6% | 15.6% | 15.7% |
| Tier 1 Risk-based Capital | 14.2% | 14.4% | 14.5% | 14.5% | 14.5% |
| Tier 1 Leverage Ratio | 10.6% | 10.5% | 10.6% | 10.6% | 10.4% |
| SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF) | |||||
| Loan Composition | |||||
| Dollars in thousands | 12/31/2014 | 9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 |
| Commercial | $ 88,590 | $ 83,762 | $ 90,096 | $ 93,517 | $ 88,352 |
| Commercial real estate | |||||
| Owner occupied | 157,783 | 156,765 | 154,260 | 150,025 | 149,618 |
| Non-owner occupied | 317,136 | 314,577 | 314,439 | 297,197 | 280,790 |
| Construction and development | |||||
| Land and development | 67,881 | 61,088 | 64,246 | 67,342 | 71,453 |
| Construction | 28,591 | 27,239 | 20,902 | 18,327 | 15,155 |
| Residential real estate | |||||
| Non-jumbo | 220,071 | 218,125 | 219,569 | 215,665 | 212,946 |
| Jumbo | 52,879 | 51,917 | 52,487 | 51,406 | 53,406 |
| Home equity | 67,115 | 64,256 | 61,248 | 56,161 | 54,844 |
| Consumer | 19,456 | 19,906 | 19,777 | 19,106 | 19,889 |
| Other | 11,507 | 6,753 | 6,798 | 5,037 | 3,276 |
| Total loans, net of unearned fees | 1,031,009 | 1,004,388 | 1,003,822 | 973,783 | 949,729 |
| Less allowance for loan losses | 11,167 | 11,041 | 11,006 | 11,069 | 12,659 |
| Loans, net | $ 1,019,842 | $ 993,347 | $ 992,816 | $ 962,714 | $ 937,070 |
| SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF) | |||||
| Deposit Composition | |||||
| Dollars in thousands | 12/31/2014 | 9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 |
| Non interest bearing checking | $ 115,427 | $ 104,442 | $ 106,134 | $ 99,445 | $ 92,837 |
| Interest bearing checking | 204,030 | 195,183 | 187,855 | 195,898 | 186,578 |
| Savings | 253,578 | 255,880 | 243,323 | 228,854 | 193,446 |
| Time deposits | 488,279 | 498,949 | 520,483 | 528,433 | 530,951 |
| Total deposits | $ 1,061,314 | $ 1,054,454 | $ 1,057,795 | $ 1,052,630 | $ 1,003,812 |
| SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF) | |||||
| Asset Quality Information | |||||
| For the Quarter Ended | |||||
| Dollars in thousands | 12/31/2014 | 9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 |
| Gross loan charge-offs | $ 362 | $ 297 | $ 1,312 | $ 2,862 | $ 1,669 |
| Gross loan recoveries | (488) | (82) | (249) | (272) | (289) |
| Net loan charge-offs | $ (126) | $ 215 | $ 1,063 | $ 2,590 | $ 1,380 |
| Net loan charge-offs to average loans (annualized) | -0.05% | 0.09% | 0.43% | 1.08% | 0.58% |
| Allowance for loan losses | $ 11,167 | $ 11,041 | $ 11,006 | $ 11,069 | $ 12,659 |
| Allowance for loan losses as a percentage of period end loans | 1.08% | 1.10% | 1.10% | 1.14% | 1.33% |
| Nonperforming assets: | |||||
| Nonperforming loans | |||||
| Commercial | $ 392 | $ 309 | $ 415 | $ 866 | $ 1,224 |
| Commercial real estate | 1,844 | 936 | 1,537 | 2,834 | 2,318 |
| Commercial construction and development | - | - | 3,601 | 3,653 | 3,782 |
| Residential construction and development | 4,619 | 4,592 | 5,248 | 6,599 | 9,048 |
| Residential real estate | 5,556 | 5,257 | 3,289 | 2,890 | 2,446 |
| Consumer | 83 | 146 | 129 | 73 | 128 |
| Total nonperforming loans | 12,494 | 11,240 | 14,219 | 16,915 | 18,946 |
| Foreclosed properties | |||||
| Commercial | 110 | 110 | 110 | - | - |
| Commercial real estate | 5,204 | 5,815 | 5,762 | 8,523 | 9,903 |
| Commercial construction and development | 10,179 | 10,178 | 10,363 | 11,097 | 11,125 |
| Residential construction and development | 19,267 | 20,431 | 20,557 | 20,640 | 20,485 |
| Residential real estate | 2,769 | 10,718 | 11,991 | 11,981 | 11,879 |
| Total foreclosed properties | 37,529 | 47,252 | 48,783 | 52,241 | 53,392 |
| Other repossessed assets | 221 | 34 | - | 28 | 8 |
| Total nonperforming assets | $ 50,244 | $ 58,526 | $ 63,002 | $ 69,184 | $ 72,346 |
| Nonperforming loans to period end loans | 1.21% | 1.12% | 1.42% | 1.74% | 1.99% |
| Nonperforming assets to period end assets | 3.48% | 4.10% | 4.39% | 4.92% | 5.22% |
| Loans Past Due 30-89 Days | |||||
| For the Quarter Ended | |||||
| In thousands | 12/31/2014 | 9/30/2014 | 6/30/2014 | 3/31/2014 | 12/31/2013 |
| Commercial | $ 382 | $ 253 | $ 376 | $ 52 | $ 74 |
| Commercial real estate | 266 | 1,094 | 1,032 | 1,310 | 1,809 |
| Construction and development | 2,278 | 324 | 156 | 754 | 1,628 |
| Residential real estate | 7,413 | 5,087 | 5,775 | 3,847 | 4,332 |
| Consumer | 269 | 427 | 585 | 219 | 292 |
| Other | 14 | 18 | - | - | - |
| Total | $ 10,622 | $ 7,203 | $ 7,924 | $ 6,182 | $ 8,135 |
| SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF) | ||||||
| Average Balance Sheet, Interest Earnings & Expenses and Average Rates | ||||||
| Q4 2014 vs Q4 2013 | ||||||
| Q4 2014 | Q4 2013 | |||||
| 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 | $ 1,006,641 | $ 12,562 | 4.95% | $ 950,162 | $ 12,450 | 5.20% |
| Tax-exempt | 9,488 | 158 | 6.61% | 5,084 | 89 | 6.95% |
| Securities | ||||||
| Taxable | 207,577 | 1,127 | 2.15% | 226,710 | 1,273 | 2.23% |
| Tax-exempt | 83,729 | 995 | 4.71% | 74,777 | 871 | 4.62% |
| Interest bearing deposits other banks and Federal funds sold | 8,102 | 2 | 0.10% | 8,156 | 1 | 0.05% |
| Total interest earning assets | 1,315,537 | 14,844 | 4.48% | 1,264,889 | 14,684 | 4.61% |
| Noninterest earning assets | ||||||
| Cash & due from banks | 3,654 | 4,279 | ||||
| Premises & equipment | 20,149 | 20,689 | ||||
| Other assets | 107,467 | 109,534 | ||||
| Allowance for loan losses | (11,239) | (13,449) | ||||
| Total assets | $ 1,435,568 | $ 1,385,942 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||
| Liabilities | ||||||
| Interest bearing liabilities | ||||||
| Interest bearing demand deposits | $ 199,932 | $ 60 | 0.12% | $ 188,839 | $ 63 | 0.13% |
| Savings deposits | 254,986 | 443 | 0.69% | 193,889 | 277 | 0.57% |
| Time deposits | 489,884 | 1,627 | 1.32% | 528,370 | 1,977 | 1.48% |
| Short-term borrowings | 124,001 | 97 | 0.31% | 59,378 | 45 | 0.30% |
| Long-term borrowings and subordinated debentures | 114,533 | 1,274 | 4.41% | 199,917 | 1,993 | 3.96% |
| Total interest bearing liabilities | 1,183,336 | 3,501 | 1.17% | 1,170,393 | 4,355 | 1.48% |
| Noninterest bearing liabilities | ||||||
| Demand deposits | 113,926 | 97,371 | ||||
| Other liabilities | 11,633 | 8,286 | ||||
| Total liabilities | 1,308,895 | 1,276,050 | ||||
| Shareholders' equity - preferred | 9,249 | 9,295 | ||||
| Shareholders' equity - common | 117,424 | 100,597 | ||||
| Total liabilities and shareholders' equity | $ 1,435,568 | $ 1,385,942 | ||||
| NET INTEREST EARNINGS | $ 11,343 | $ 10,329 | ||||
| NET INTEREST MARGIN | 3.42% | 3.24% | ||||
| SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF) | ||||||
| Average Balance Sheet, Interest Earnings & Expenses and Average Rates | ||||||
| YTD 2014 vs YTD 2013 | ||||||
| YTD 2014 | YTD 2013 | |||||
| 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 | $ 984,723 | $ 50,078 | 5.09% | $ 949,616 | $ 50,505 | 5.32% |
| Tax-exempt | 7,823 | 533 | 6.81% | 5,440 | 388 | 7.13% |
| Securities | ||||||
| Taxable | 211,700 | 4,692 | 2.22% | 208,588 | 4,131 | 1.98% |
| Tax-exempt | 81,549 | 3,780 | 4.64% | 75,707 | 3,647 | 4.82% |
| Interest bearing deposits other banks and Federal funds sold | 9,325 | 8 | 0.09% | 7,821 | 5 | 0.06% |
| Total interest earning assets | 1,295,120 | 59,091 | 4.56% | 1,247,172 | 58,676 | 4.70% |
| Noninterest earning assets | ||||||
| Cash & due from banks | 3,756 | 4,381 | ||||
| Premises & equipment | 20,346 | 20,926 | ||||
| Other assets | 112,504 | 125,629 | ||||
| Allowance for loan losses | (11,724) | (15,152) | ||||
| Total assets | $ 1,420,002 | $ 1,382,956 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||
| Liabilities | ||||||
| Interest bearing liabilities | ||||||
| Interest bearing demand deposits | $ 192,190 | $ 222 | 0.12% | $ 181,413 | $ 255 | 0.14% |
| Savings deposits | 238,340 | 1,580 | 0.66% | 195,398 | 1,152 | 0.59% |
| Time deposits | 513,110 | 7,193 | 1.40% | 556,644 | 8,985 | 1.61% |
| Short-term borrowings | 100,786 | 306 | 0.30% | 34,098 | 95 | 0.28% |
| Long-term borrowings and subordinated debentures | 142,213 | 5,939 | 4.18% | 202,237 | 7,991 | 3.95% |
| 1,186,639 | 15,240 | 1.28% | 1,169,790 | 18,478 | 1.58% | |
| Noninterest bearing liabilities | ||||||
| Demand deposits | 104,262 | 94,943 | ||||
| Other liabilities | 10,119 | 8,951 | ||||
| Total liabilities | 1,301,020 | 1,273,684 | ||||
| Shareholders' equity - preferred | 9,276 | 9,313 | ||||
| Shareholders' equity - common | 109,706 | 99,959 | ||||
| Total liabilities and shareholders' equity | $ 1,420,002 | $ 1,382,956 | ||||
| NET INTEREST EARNINGS | $ 43,851 | $ 40,198 | ||||
| NET INTEREST MARGIN | 3.39% | 3.22% | ||||
| SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF) | |||||
| Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures | |||||
| For the Quarter Ended | For the Years Ended | ||||
| Dollars in thousands | 12/31/2014 | 9/30/2014 | 12/31/2013 | 12/31/2014 | 12/31/2013 |
| Core earnings applicable to common shares | $ 3,789 | $ 4,101 | $ 2,904 | $ 13,639 | $ 9,887 |
| Realized securities gains (losses) | 149 | 128 | 124 | 213 | 240 |
| Applicable income tax effect | (55) | (47) | (46) | (79) | (89) |
| Gain (loss) on sale of foreclosed properties | (628) | (70) | 28 | (827) | (518) |
| Applicable income tax effect | 232 | 26 | (10) | 306 | 192 |
| Other-than-temporary impairment of securities | - | - | - | (1) | (118) |
| Applicable income tax effect | - | - | - | - | 44 |
| Fraud loss | (461) | - | - | (461) | - |
| Applicable income tax effect | 171 | - | - | 171 | - |
| Write-downs foreclosed properties | (300) | (1,580) | (644) | (3,771) | (3,722) |
| Applicable income tax effect | 111 | 585 | 238 | 1,395 | 1,377 |
| (781) | (958) | (310) | (3,054) | (2,594) | |
| GAAP net income applicable to common shares | $ 3,008 | $ 3,143 | $ 2,594 | $ 10,585 | $ 7,293 |
| Core diluted earnings per common share | $ 0.40 | $ 0.45 | $ 0.32 | $ 1.50 | $ 1.12 |
| Realized securities gains (losses) | 0.01 | 0.01 | 0.01 | 0.02 | 0.02 |
| Applicable income tax effect | - | - | - | (0.01) | (0.01) |
| Gain (loss) on sale of foreclosed properties | (0.06) | (0.01) | - | (0.09) | (0.05) |
| Applicable income tax effect | 0.02 | - | - | 0.03 | 0.02 |
| Other-than-temporary impairment of securities | - | - | - | - | (0.01) |
| Applicable income tax effect | - | - | - | - | - |
| Fraud loss | (0.05) | (0.01) | - | (0.05) | - |
| Applicable income tax effect | 0.02 | - | - | 0.02 | - |
| Write-downs of foreclosed properties | (0.03) | (0.16) | (0.07) | (0.39) | (0.39) |
| Applicable income tax effect | 0.01 | 0.06 | 0.03 | 0.14 | 0.14 |
| (0.08) | (0.11) | (0.03) | (0.33) | (0.28) | |
| GAAP diluted earnings per common share | $ 0.32 | $ 0.34 | $ 0.29 | $ 1.17 | $ 0.84 |
| SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF) | |||||
| Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures | |||||
| For the Quarter Ended | For the Years Ended | ||||
| Dollars in thousands | 12/31/2014 | 9/30/2014 | 12/31/2013 | 12/31/2014 | 12/31/2013 |
| Total core revenue | $ 13,624 | $ 13,862 | $ 12,775 | $ 53,396 | $ 49,890 |
| Realized securities gains/(losses) | 149 | 128 | 124 | 213 | 240 |
| Other-than-temporary impairment of securities | - | - | - | (1) | (118) |
| 149 | 128 | 124 | 212 | 122 | |
| GAAP total revenue | $ 13,773 | $ 13,990 | $ 12,899 | $ 53,608 | $ 50,012 |
| Total core noninterest income | $ 2,673 | $ 2,785 | $ 2,772 | $ 11,011 | $ 11,087 |
| Realized securities gains/(losses) | 149 | 128 | 124 | 213 | 240 |
| Other-than-temporary impairment of securities | - | - | - | (1) | (118) |
| 149 | 128 | 124 | 212 | 122 | |
| GAAP total noninterest income | $ 2,822 | $ 2,913 | $ 2,896 | $ 11,223 | $ 11,209 |
| Total core noninterest expense | $ 7,721 | $ 7,535 | $ 7,809 | $ 30,726 | $ 30,516 |
| Fraud loss | 461 | - | - | 461 | - |
| (Gains)/losses on sales of foreclosed properties | 628 | 70 | (28) | 827 | 518 |
| Write-downs of foreclosed properties | 300 | 1,580 | 644 | 3,771 | 3,722 |
| 1,389 | 1,650 | 616 | 5,059 | 4,240 | |
| GAAP total noninterest expense | $ 9,110 | $ 9,185 | $ 8,425 | $ 35,785 | $ 34,756 |