Exhibit

MOOREFIELD, WV - October 26, 2015 (GLOBE NEWSWIRE) - Summit Financial Group, Inc. (“Company” or “Summit”) (NASDAQ: SMMF) today reported third quarter 2015 net income applicable to common shares of $3.66 million, or $0.34 per diluted share, compared to $3.14 million, or $0.35 per diluted share, for the third quarter of 2014, representing an increase in net income of 16.5 percent, but a 2.9 percent decrease in diluted earnings per share. Q3 2015 earnings compared to Q3 2014 were positively impacted by a $534,000 decline in write-downs of foreclosed properties and a $228,000 increase in net interest income. Increased common shares outstanding resulting from common stock issuances during the past year accounted for the $0.01 decline in quarterly year-over-year diluted earnings per share, despite the increase in earnings.

Excluding from third quarter 2015 (on a pre-tax basis) realized securities gains of $372,000, losses on sales of foreclosed properties of $35,000, and write-downs of foreclosed properties of $1.0 million, Q3 2015 core earnings approximated $4.11 million, or $0.38 per diluted share. Excluding from third quarter 2014 (on a pre-tax basis) realized securities gains of $128,000, losses on sales of foreclosed properties of $70,000, and write-downs of foreclosed properties of $1.58 million, Q3 2014 core earnings approximated $4.10 million, or $0.45 per diluted share.

Excluding from the nine month period ended September 30, 2015 nonrecurring items (on a pre-tax basis) comprised of realized securities gains of $1.02 million, a $176,000 Federal Home Loan Bank of Pittsburgh (“FHLB”) special dividend, losses on sales of assets of $288,000, and write-downs of foreclosed properties of $1.78 million, and from the 2014 first nine-month period realized securities gains of $64,000, losses on sales of assets of $199,000, OTTI charges of $1,000 and write-downs of foreclosed properties of $3.47 million, core earnings for first nine months of 2015 were approximately $12.50

H. Charles Maddy III, President and Chief Executive Officer of Summit, commented, “Our results for the quarter just ended were mixed, as the robust loan growth we had experienced in the first half of 2015, stalled in the third quarter. This coupled with lower securities yields halted the quarter-over-quarter growth in core revenues and net interest margin improvement that we had enjoyed earlier this year. Despite this, we are very pleased by Summit’s considerable growth in both quarterly and year-to-date net income compared to the same periods of the prior year, giving us optimism as we look forward to the remainder of 2015 and beyond.”

Noninterest income, consisting primarily of insurance commissions from Summit's insurance agency subsidiary and service fee income from community banking activities, for third quarter 2015 was $2.99 million compared to $2.91 million for the comparable period of 2014. Excluding realized securities gains/losses and OTTI of securities, noninterest income was $2.62 million for third quarter 2015, compared to $2.79 million reported for third quarter 2014.

Core noninterest expense continues to be well-controlled. Total noninterest expense decreased 3.4% to $8.87 million compared to $9.19 million for the prior-year third quarter. Excluding from noninterest expense (on a pre-tax basis) losses on sales of foreclosed properties of $35,000 in Q3 2015 and $70,000 in Q3 2014 and write-downs of foreclosed properties of $1.05 million in Q3 2015 and $1.58 million in Q3 2014, noninterest expense would have approximated $7.79 million for Q3 2015 compared to $7.54 million for the comparable period of 2014. Noninterest expense for the first nine months of 2015 decreased 4.1% compared to the first nine months of 2014.

At September 30, 2015, deposits were $1.07 billion, an increase of $10.8 million, or 1.0 percent, since year end 2014. During first nine months of 2015, checking and savings increased by $16.7 million and $5.6 million, respectively, or 5.2 percent and 2.2 percent, respectively, while time deposits decreased $11.5 million or 2.4 percent. Long-term borrowings and subordinated debentures declined by 16.0 percent since year end 2014, as the Company prepaid $16.8 million in subordinated debentures, which was funded by short-term borrowings.

At September 30, 2015, Summit’s and its depository institution’s, Summit Community Bank, Inc.’s (the “Bank’s”), regulatory risk-based capital ratios computed in accordance with the new Basel III regulatory capital guidelines effective January 1, 2015, were each well in excess of the regulatory minimum required ratio relative to each plus the respective applicable capital conservation buffer on a fully phased-in basis. Respectively, the Company’s and Bank’s Tier 1 leverage capital ratios were 10.5 percent and 10.7 percent at September 30, 2015 compared to 9.9 percent and 10.6 percent reported at December 31, 2014.

Summit Financial Group, Inc. is a $1.47 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.

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.

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 -- Q3 2015 vs Q3 2014
	For the Quarter Ended				Percent
Dollars in thousands	9/30/2015		9/30/2014		Change
Condensed Statements of Income
Interest income
Loans, including fees	$	12,983	$	13,033	-0.4	%
Securities	1,543		1,724		-10.5	%
Other	5		3		66.7	%
Total interest income	14,531		14,760		-1.6	%
Interest expense
Deposits	2,106		2,288		-8.0	%
Borrowings	1,120		1,395		-19.7	%
Total interest expense	3,226		3,683		-12.4	%
Net interest income	11,305		11,077		2.1	%
Provision for loan losses	250		250		—	%
Net interest income after provision for loan losses	11,055		10,827		2.1	%

Noninterest income
Insurance commissions	983		1,105		-11.0	%
Service fees related to deposit accounts	1,111		1,177		-5.6	%
Realized securities gains	372		128		n/m
Other income	527		503		4.8	%
Total noninterest income	2,993		2,913		2.7	%
Noninterest expense
Salaries and employee benefits	4,479		4,026		11.3	%
Net occupancy expense	496		482		2.9	%
Equipment expense	582		520		11.9	%
Professional fees	402		380		5.8	%
FDIC premiums	300		480		-37.5	%
Foreclosed properties expense	168		298		-43.6	%
Loss on sales of foreclosed properties	35		70		-50.0	%
Write-downs of foreclosed properties	1,046		1,580		-33.8	%
Other expenses	1,364		1,350		1.0	%
Total noninterest expense	8,872		9,186		-3.4	%
Income before income taxes	5,176		4,554		13.7	%
Income taxes	1,515		1,218		24.4	%
Net income	3,661		3,336		9.7	%
Preferred stock dividends	—		193		n/m

Net income applicable to common shares	$	3,661	$	3,143	16.5	%



SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Quarterly Performance Summary -- Q3 2015 vs Q3 2014

	For the Quarter Ended						Percent
	9/30/2015			9/30/2014			Change
Per Share Data
Earnings per common share
Basic	$	0.34		$	0.42		-19.0	%
Diluted	$	0.34		$	0.35		-2.9	%

Cash dividends	$	0.08		$	—		n/a

Average common shares outstanding
Basic	10,703,526			7,457,222			43.5	%
Diluted	10,712,203			9,630,293			11.2	%

Common shares outstanding at period end	10,658,199			7,457,222			42.9	%

Performance Ratios
Return on average equity	10.42		%	11.13		%	-6.4	%
Return on average tangible equity	11.01		%	11.90		%	-7.5	%
Return on average assets	1.00		%	0.93		%	7.5	%
Net interest margin	3.41		%	3.47		%	-1.7	%
Efficiency ratio (A)	52.93		%	51.19		%	3.4	%


NOTE (A) - Computed on a tax equivalent basis excluding nonrecurring income and expense items and amortization of intangibles.



SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Nine Month Performance Summary -- 2015 vs 2014
	For the Nine Months Ended					Percent
Dollars in thousands	9/30/2015		9/30/2014			Change
Condensed Statements of Income
Interest income
Loans, including fees	$	38,804	$	37,764		2.8	%
Securities	5,122		5,403			-5.2	%
Other	7		7			—	%
Total interest income	43,933		43,174			1.8	%
Interest expense
Deposits	6,251		6,864			-8.9	%
Borrowings	3,399		4,875			-30.3	%
Total interest expense	9,650		11,739			-17.8	%
Net interest income	34,283		31,435			9.1	%
Provision for loan losses	1,000		2,250			-55.6	%
Net interest income after provision for loan losses	33,283		29,185			14.0	%

Noninterest income
Insurance commissions	3,191		3,377			-5.5	%
Service fees related to deposit accounts	3,159		3,291			-4.0	%
Realized securities gains	1,023		64			n/m
Other-than-temporary impairment of securities	—		(1		)	-100.0	%
Other income	1,619		1,670			-3.1	%
Total noninterest income	8,992		8,401			7.0	%
Noninterest expense
Salaries and employee benefits	13,107		12,052			8.8	%
Net occupancy expense	1,483		1,528			-2.9	%
Equipment expense	1,677		1,599			4.9	%
Professional fees	1,109		978			13.4	%
FDIC premiums	950		1,477			-35.7	%
Foreclosed properties expense	534		780			-31.5	%
Loss on sales of foreclosed properties	288		198			45.5	%
Write-downs of foreclosed properties	1,779		3,471			-48.7	%
Other expenses	4,211		4,130			2.0	%
Total noninterest expense	25,138		26,213			-4.1	%
Income before income taxes	17,137		11,373			50.7	%
Income taxes	5,181		3,215			61.2	%
Net income	11,956		8,158			46.6	%
Preferred stock dividends	—		580			n/m

Net income applicable to common shares	$	11,956	$	7,578		57.8	%



SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Nine Month Performance Summary -- 2015 vs 2014

	For the Nine Months Ended						Percent
	9/30/2015			9/30/2014			Change
Per Share Data
Earnings per common share
Basic	$	1.19		$	1.02		16.7	%
Diluted	$	1.12		$	0.85		31.8	%

Cash dividends	$	0.24		$	—		n/a

Average common shares outstanding
Basic	10,069,374			7,455,952			35.1	%
Diluted	10,628,139			9,626,942			10.4	%

Common shares outstanding at period end	10,658,199			7,457,222			42.9	%

Performance Ratios
Return on average equity	11.61		%	9.35		%	24.2	%
Return on average tangible equity	12.29		%	10.02		%	22.7	%
Return on average assets	1.09		%	0.77		%	41.6	%
Net interest margin	3.50		%	3.37		%	3.9	%
Efficiency ratio (A)	51.40		%	52.69		%	-2.4	%


NOTE (A) - Computed on a tax equivalent basis excluding nonrecurring income and expense items and amortization of intangibles.



SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Five Quarter Performance Summary

	For the Quarter Ended
Dollars in thousands	9/30/2015		6/30/2015		3/31/2015		12/31/2014		9/30/2014
Condensed Statements of Income
Interest income
Loans, including fees	$	12,983	$	12,972	$	12,848	$	12,666	$	13,033
Securities	1,543		1,685		1,894		1,784		1,724
Other	5		1		1		2		3
Total interest income	14,531		14,658		14,743		14,452		14,760
Interest expense
Deposits	2,106		2,074		2,071		2,130		2,288
Borrowings	1,120		1,126		1,152		1,371		1,395
Total interest expense	3,226		3,200		3,223		3,501		3,683
Net interest income	11,305		11,458		11,520		10,951		11,077
Provision for loan losses	250		500		250		—		250
Net interest income after provision for loan losses	11,055		10,958		11,270		10,951		10,827

Noninterest income
Insurance commissions	983		1,080		1,128		1,023		1,105
Service fees related to deposit accounts	1,111		1,072		976		1,113		1,177
Realized securities gains	372		170		480		149		128
Other-than-temporary impairment of securities	—		—		—		—		—
Other income	527		538		555		537		503
Total noninterest income	2,993		2,860		3,139		2,822		2,913
Noninterest expense
Salaries and employee benefits	4,479		4,442		4,187		4,133		4,026
Net occupancy expense	496		489		498		495		482
Equipment expense	582		560		535		487		520
Professional fees	402		372		335		452		380
FDIC premiums	300		320		330		315		480
Foreclosed properties expense	168		158		208		239		298
Loss on sale of foreclosed properties	35		103		150		628		70
Write-downs of foreclosed properties	1,046		160		572		300		1,580
Other expenses	1,364		1,457		1,389		2,061		1,350
Total noninterest expense	8,872		8,061		8,204		9,110		9,186
Income before income taxes	5,176		5,757		6,205		4,663		4,554
Income taxes	1,515		1,747		1,920		1,464		1,218
Net income	3,661		4,010		4,285		3,199		3,336
Preferred stock dividends	—		—		—		191		193
Net income applicable to common shares	$	3,661	$	4,010	$	4,285	$	3,008	$	3,143



SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Five Quarter Performance Summary

	For the Quarter Ended
	9/30/2015			6/30/2015			3/31/2015			12/31/2014			9/30/2014
Per Share Data
Earnings per common share
Basic	$	0.34		$	0.38		$	0.49		$	0.39		$	0.42
Diluted	$	0.34		$	0.38		$	0.41		$	0.32		$	0.35

Cash dividends	$	0.08		$	0.08		$	0.08		$	—		$	—

Average common shares outstanding
Basic	10,703,526			10,667,892			8,815,961			7,796,508			7,457,222
Diluted	10,712,203			10,676,474			10,493,323			9,963,214			9,630,293

Common shares outstanding at period end	10,658,199			10,843,676			10,586,242			8,301,746			7,457,222

Performance Ratios
Return on average equity	10.42		%	11.67		%	12.79		%	10.10		%	11.13		%
Return on average tangible equity	11.01		%	12.36		%	13.56		%	10.76		%	11.90		%
Return on average assets	1.00		%	1.09		%	1.18		%	0.89		%	0.93		%
Net interest margin	3.41		%	3.49		%	3.59		%	3.42		%	3.47		%
Efficiency ratio - (A)	52.93		%	52.05		%	49.27		%	53.07		%	51.19		%

NOTE (A) - Computed on a tax equivalent basis excluding nonrecurring income and expense items and amortization of intangibles.



SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Selected Balance Sheet Data

	For the Quarter Ended
Dollars in thousands, except per share amounts	9/30/2015			6/30/2015			3/31/2015			12/31/2014			9/30/2014

Assets
Cash and due from banks	$	4,232		$	3,988		$	3,850		$	3,728		$	3,933
Interest bearing deposits other banks	8,057			9,274			8,437			8,783			9,300
Securities	272,127			276,661			282,135			282,834			282,401
Loans, net	1,062,348			1,064,472			1,039,669			1,019,842			993,347
Property held for sale	29,713			31,500			34,368			37,529			47,252
Premises and equipment, net	20,457			20,490			20,208			20,060			20,132
Intangible assets	7,548			7,598			7,648			7,698			7,748
Cash surrender value of life insurance policies	37,482			37,222			36,961			36,700			36,417
Other assets	27,340			28,764			27,216			26,394			28,139
Total assets	$	1,469,304		$	1,479,969		$	1,460,492		$	1,443,568		$	1,428,669

Liabilities and Shareholders' Equity
Deposits	$	1,072,091		$	1,053,310		$	1,058,308		$	1,061,314		$	1,054,454
Short-term borrowings	145,291			174,599			148,985			123,633			127,432
Long-term borrowings and subordinated debentures	95,648			98,625			101,602			113,879			114,855
Other liabilities	15,985			13,363			15,708			13,098			10,566
Shareholders' equity	140,289			140,072			135,889			131,644			121,362
Total liabilities and shareholders' equity	$	1,469,304		$	1,479,969		$	1,460,492		$	1,443,568		$	1,428,669

Book value per common share (A)	$	13.16		$	12.92		$	12.84		$	12.60		$	12.62
Tangible book value per common share (A)	$	12.45		$	12.22		$	12.11		$	11.86		$	11.81
Tangible equity to tangible assets	9.1		%	9.0		%	8.8		%	8.6		%	8.0		%
Tangible common equity to tangible assets	9.1		%	9.0		%	8.8		%	8.0		%	7.3		%

NOTE (A) - Assumes conversion of convertible preferred stock



SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)
Regulatory Capital Ratios (A)

	9/30/2015		6/30/2015		3/31/2015		12/31/2014		9/30/2014
Summit Financial Group, Inc.
CET1 Risk-based Capital	11.7	%	11.6	%	11.3	%	n/a		n/a
Tier 1 Risk-based Capital	13.4	%	13.2	%	13.0	%	13.3	%	12.5	%
Total Risk Based Capital	14.4	%	14.2	%	14.0	%	14.9	%	14.3	%
Tier 1 Leverage Ratio	10.5	%	10.4	%	10.1	%	9.9	%	9.2	%

Summit Community Bank, Inc.
CET1 Risk-based Capital	13.6	%	13.4	%	13.5	%	n/a		n/a
Tier 1 Risk-based Capital	13.6	%	13.4	%	13.5	%	14.2	%	14.4	%
Total Risk Based Capital	14.6	%	14.4	%	14.5	%	15.3	%	15.5	%
Tier 1 Leverage Ratio	10.7	%	10.6	%	10.5	%	10.6	%	10.5	%

NOTE (A) - Computed in accordance with Basel III regulatory capital guidelines beginning January 1, 2015



SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)
Loan Composition

Dollars in thousands	9/30/2015		6/30/2015		3/31/2015		12/31/2014		9/30/2014

Commercial	$	89,250	$	97,284	$	89,928	$	88,590	$	83,762
Commercial real estate
Owner occupied	199,068		191,743		180,269		157,783		156,765
Non-owner occupied	336,550		331,056		325,764		317,136		314,577
Construction and development
Land and development	66,164		64,435		66,558		67,881		61,088
Construction	8,419		18,214		19,094		28,591		27,239
Residential real estate
Non-jumbo	222,739		220,199		219,938		220,071		218,125
Jumbo	46,092		49,203		50,492		52,879		51,917
Home equity	73,652		72,504		68,894		67,115		64,256
Consumer	19,124		18,683		18,485		19,456		19,906
Other	12,518		12,423		11,074		11,507		6,753
Total loans, net of unearned fees	1,073,576		1,075,744		1,050,496		1,031,009		1,004,388
Less allowance for loan losses	11,228		11,272		10,827		11,167		11,041
Loans, net	$	1,062,348	$	1,064,472	$	1,039,669	$	1,019,842	$	993,347



SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)
Deposit Composition

Dollars in thousands	9/30/2015		6/30/2015		3/31/2015		12/31/2014		9/30/2014
Non interest bearing checking	$	118,887	$	113,256	$	117,049	$	115,427	$	104,442
Interest bearing checking	217,242		202,957		196,606		204,030		195,183
Savings	259,185		246,949		257,687		253,578		255,880
Time deposits	476,777		490,148		486,966		488,279		498,949
Total deposits	$	1,072,091	$	1,053,310	$	1,058,308	$	1,061,314	$	1,054,454



SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Asset Quality Information
	For the Quarter Ended
Dollars in thousands	9/30/2015			6/30/2015			3/31/2015			12/31/2014			9/30/2014

Gross loan charge-offs	$	774		$	463		$	782		$	362		$	297
Gross loan recoveries	(481		)	(407		)	(192		)	(488		)	(82		)
Net loan charge-offs	$	293		$	56		$	590		$	(126	)	$	215

Net loan charge-offs to average loans (annualized)	0.11		%	0.02		%	0.23		%	-0.05		%	0.09		%
Allowance for loan losses	$	11,228		$	11,272		$	10,827		$	11,167		$	11,041
Allowance for loan losses as a percentage of period end loans	1.05		%	1.05		%	1.03		%	1.08		%	1.10		%

Nonperforming assets:
Nonperforming loans
Commercial	$	884		$	1,065		$	788		$	392		$	309
Commercial real estate	5,294			2,421			1,340			1,844			936
Commercial construction and development	—			—			—			—			—
Residential construction and development	5,345			5,627			5,333			4,619			4,592
Residential real estate	3,881			4,433			4,491			5,556			5,257
Consumer	53			45			65			83			146
Total nonperforming loans	15,457			13,591			12,017			12,494			11,240
Foreclosed properties
Commercial	—			—			110			110			110
Commercial real estate	3,209			3,279			3,657			5,204			5,815
Commercial construction and development	9,328			10,178			10,191			10,179			10,178
Residential construction and development	14,965			15,839			17,590			19,267			20,431
Residential real estate	2,211			2,204			2,819			2,769			10,718
Total foreclosed properties	29,713			31,500			34,367			37,529			47,252
Other repossessed assets	—			55			55			221			34
Total nonperforming assets	$	45,170		$	45,146		$	46,439		$	50,244		$	58,526

Nonperforming loans to period end loans	1.44		%	1.26		%	1.14		%	1.21		%	1.12		%
Nonperforming assets to period end assets	3.07		%	3.05		%	3.18		%	3.48		%	4.10		%



SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Average Balance Sheet, Interest Earnings & Expenses and Average Rates
Q3 2015 vs Q3 2014
	Q3 2015							Q3 2014
	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	$	1,050,058		$	12,855	4.86	%	$	995,270		$	12,944	5.22	%
Tax-exempt	13,360			194		5.76	%	8,331			135		6.43	%
Securities
Taxable	208,473			933		1.78	%	208,891			1,084		2.06	%
Tax-exempt	75,571			924		4.85	%	83,956			970		4.58	%
Interest bearing deposits other banks and Federal funds sold	13,116			5		0.15	%	11,842			3		0.10	%
Total interest earning assets	1,360,578			14,911		4.35	%	1,308,290			15,136		4.59	%

Noninterest earning assets
Cash & due from banks	3,871							3,690
Premises & equipment	20,502							20,229
Other assets	93,563							112,103
Allowance for loan losses	(11,521		)					(11,272		)
Total assets	$	1,466,993						$	1,433,040

LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities
Interest bearing liabilities
Interest bearing
demand deposits	$	210,691		$	61	0.11	%	$	191,565		$	55	0.11	%
Savings deposits	251,932			450		0.71	%	251,401			430		0.68	%
Time deposits	485,453			1,595		1.30	%	508,817			1,803		1.41	%
Short-term borrowings	148,012			130		0.35	%	123,495			98		0.31	%
Long-term borrowings and subordinated debentures	97,500			990		4.03	%	121,101			1,297		4.25	%
Total interest bearing liabilities	1,193,588			3,226		1.07	%	1,196,379			3,683		1.22	%

Noninterest bearing liabilities
Demand deposits	118,603							105,887
Other liabilities	14,242							10,857
Total liabilities	1,326,433							1,313,123

Shareholders' equity - preferred	—							9,283
Shareholders' equity - common	140,560							110,634
Total liabilities and shareholders' equity	$	1,466,993						$	1,433,040

NET INTEREST EARNINGS				$	11,685						$	11,453

NET INTEREST MARGIN						3.41	%						3.47	%



SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Average Balance Sheet, Interest Earnings & Expenses and Average Rates
YTD 2015 vs YTD 2014
	YTD 2015							YTD 2014
	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	$	1,044,010		$	38,443	4.92	%	$	977,336		$	37,516	5.13	%
Tax-exempt	12,801			547		5.71	%	7,262			376		6.92	%
Securities
Taxable	211,642			3,302		2.09	%	213,089			3,565		2.24	%
Tax-exempt	75,685			2,759		4.87	%	80,814			2,785		4.61	%
Interest bearing deposits other banks and Federal funds sold	9,395			6		0.09	%	9,737			6		0.08	%
Total interest earning assets	1,353,533			45,057		4.45	%	1,288,238			44,248		4.59	%

Noninterest earning assets
Cash & due from banks	3,842							3,790
Premises & equipment	20,373							20,414
Other assets	96,142							114,203
Allowance for loan losses	(11,285		)					(11,887		)
Total assets	$	1,462,605						$	1,414,758

LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities
Interest bearing liabilities
Interest bearing
demand deposits	$	205,749		$	179	0.12	%	$	189,581		$	162	0.11	%
Savings deposits	252,701			1,307		0.69	%	232,730			1,137		0.65	%
Time deposits	485,939			4,765		1.31	%	520,937			5,566		1.43	%
Short-term borrowings	149,177			368		0.33	%	92,963			209		0.30	%
Long-term borrowings and subordinated debentures	101,245			3,030		4.00	%	151,541			4,665		4.12	%
Total interest bearing liabilities	1,194,811			9,649		1.08	%	1,187,752			11,739		1.32	%

Noninterest bearing liabilities
Demand deposits	116,057							101,006
Other liabilities	14,371							9,609
Total liabilities	1,325,239							1,298,367

Shareholders' equity - preferred	2,388							9,286
Shareholders' equity - common	134,978							107,105
Total liabilities and shareholders' equity	$	1,462,605						$	1,414,758

NET INTEREST EARNINGS				$	35,408						$	32,509

NET INTEREST MARGIN						3.50	%						3.37	%



SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures

	For the Quarter Ended									For the Nine Months Ended
Dollars in thousands	9/30/2015			6/30/2015			9/30/2014			9/30/2015			9/30/2014

Core earnings applicable to common shares	$	4,108		$	4,069		$	4,101		$	12,503		$	9,851

FHLB special dividend	—			—			—			176			—
Applicable income tax effect	—			—			—			(65		)	—
Realized securities gains	372			170			128			1,023			64
Applicable income tax effect	(138		)	(63		)	(47		)	(379		)	(24		)
Loss on sale of foreclosed properties	(35		)	(103		)	(70		)	(288		)	(199		)
Applicable income tax effect	13			38			26			107			74
Other-than-temporary impairment of securities	—			—			—			—			(1		)
Applicable income tax effect	—			—			—			—			—
Write-downs foreclosed properties	(1,046		)	(160		)	(1,580		)	(1,779		)	(3,471		)
Applicable income tax effect	387			59			585			658			1,284
	(447		)	(59		)	(958		)	(547		)	(2,273		)
GAAP net income applicable to common shares	$	3,661		$	4,010		$	3,143		$	11,956		$	7,578


Core diluted earnings per common share	$	0.38		$	0.39		$	0.45		$	1.18		$	1.08

FHLB special dividend	—			—			—			0.02			—
Applicable income tax effect	—			—			—			(0.01		)	—
Realized securities gains	0.03			0.02			0.01			0.10			0.01
Applicable income tax effect	(0.01		)	(0.01		)	—			(0.04		)	—
Loss on sale of foreclosed properties	—			(0.01		)	(0.01		)	(0.03		)	(0.02		)
Applicable income tax effect	—			—			—			0.01			0.01
Other-than-temporary impairment of securities	—			—			—			—			—
Applicable income tax effect	—			—			—			—			—
Write-downs of foreclosed properties	(0.10		)	(0.01		)	(0.16		)	(0.17		)	(0.36		)
Applicable income tax effect	0.04			—			0.06			0.06			0.13
	(0.04		)	(0.01		)	(0.10		)	(0.06		)	(0.23		)
GAAP diluted earnings per common share	$	0.34		$	0.38		$	0.35		$	1.12		$	0.85



SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures

	For the Quarter Ended						For the Nine Months Ended
Dollars in thousands	9/30/2015		6/30/2015		9/30/2014		9/30/2015		9/30/2014

Total core revenue	$	13,926	$	14,148	$	13,862	$	42,076	$	39,773

FHLB special dividend	—		—		—		176		—
Realized securities gains	372		170		128		1,023		64
Other-than-temporary impairment of securities	—		—		—		—		(1		)
	372		170		128		1,199		63
GAAP total revenue	$	14,298	$	14,318	$	13,990	$	43,275	$	39,836


Total core noninterest income	$	2,621	$	2,690	$	2,785	$	7,969	$	8,338

Realized securities gains	372		170		128		1,023		64
Other-than-temporary impairment of securities	—		—		—		—		(1		)
	372		170		128		1,023		63
GAAP total noninterest income	$	2,993	$	2,860	$	2,913	$	8,992	$	8,401


Total core noninterest expense	$	7,791	$	7,798	$	7,536	$	21,469	$	22,543

Losses on sales of foreclosed properties	35		103		70		198		199
Write-downs of foreclosed properties	1,046		160		1,580		3,471		3,471
	1,081		263		1,650		3,669		3,670
GAAP total noninterest expense	$	8,872	$	8,061	$	9,186	$	25,138	$	26,213


•	Net interest margin contracted 8 and 6 basis points, respectively, as compared to that for Q2 2015 and Q3 2014.


•	Despite loans declining $2.2 million, or 0.8 percent (on an annualized basis) during the quarter, loans grew $42.6 million during the first nine months of 2015, or 5.5 percent (on an annualized basis).


•	Core revenues decreased 1.6 percent compared to the linked quarter, but remained relatively flat compared to the year ago quarter.


•	Recorded charges of $1.05 million to write-down foreclosed properties compared to such charges of $160,000 in Q2 2015 and $1.58 million in Q3 2014.


•	Nonperforming assets as a percentage of total assets increased slightly during the quarter to 3.07 percent compared to 3.05 percent for the linked quarter, but remains well below year end 2014 levels of 3.48 percent. Foreclosed properties are at the lowest level since Q2 2009.