8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

__________________________________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 26, 2018

Summit Financial Group, Inc.

(Exact name of registrant as specified in its charter)

West Virginia	No. 0-16587	55-0672148
(State or other jurisdiction of	(Commission File Number)	(I.R.S. Employer
incorporation or organization)		Identification No.)

300 North Main Street

Moorefield, West Virginia 26836

(Address of Principal Executive Offices)

(304) 530-1000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ]	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ]	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ]	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ]	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined by Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Section 2 - Financial Information

Item 2.02. Results of Operations and Financial Condition

On April 26, 2018, Summit Financial Group, Inc. (“Summit”) issued a News Release announcing its earnings for the three months ended March 31, 2018. This News Release is furnished as Exhibit 99 and is incorporated herein by reference.

Section 9 - Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits

(d)    Exhibits

99 News Release issued on April 26, 2018

SIGNATURE

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

	SUMMIT FINANCIAL GROUP, INC.
Date: April 27, 2018	By: /s/ Julie R. Markwood
	Julie R. Markwood
	Vice President and Chief Accounting Officer

2

EX-99

EXHIBIT 99

FOR RELEASE 6:00 AM ET, April 26, 2018

Contact:Robert S. Tissue, Sr. Vice President & CFO

Telephone:(304) 530-0552

Email:rtissue@summitfgi.com

SUMMIT FINANCIAL GROUP REPORTS FIRST QUARTER 2018 RESULTS

Q1 2018 Diluted EPS $0.60 compared to $0.19 for Q4 2017 and ($0.15) for Q1 2017

MOOREFIELD, WV - April 26, 2018 (GLOBE NEWSWIRE) - Summit Financial Group, Inc. (“Company” or “Summit”) (NASDAQ: SMMF) today reported first quarter 2018 net income of $7.44 million, or $0.60 per diluted share. In comparison, earnings for fourth quarter 2017 were $2.32 million, or $0.19 per diluted share, and for first quarter 2017, net loss of $1.62 million, or ($0.15) per diluted share. Earnings for first quarter 2018 were positively impacted by lower effective corporate income tax rate as result of enactment of the Tax Cuts and Jobs Act (“TCJA”) and by realized gains on sales of securities. Earnings per diluted share for fourth quarter 2017 were negatively impacted (on an after-tax basis) by the one-time charge of $0.28 to re-measure the Company’s net deferred tax assets as result of enactment of the TCJA. Summit’s first quarter 2017 net loss resulted principally from a legal settlement which reduced its earnings by $0.58 per diluted share.

Highlights for Q1 2018

• Loans, excluding mortgage warehouse lines of credit and First Century Bankshares, Inc.’s (“FCB”) purchased loan portfolio, grew $42.7 million, or 12.3 percent (on an annualized basis);

• Core deposits grew $27.1 million, or 11.0 percent (on an annualized basis);

• Net interest margin declined 7 basis points compared to Q4 2017 primarily due to lower taxable equivalent yields on tax exempt interest earning assets resulting from reduction in the corporate income tax rate upon enactment of TCJA;

• Efficiency ratio was 53.8 percent compared to 52.4 percent for Q4 2017, also negatively impacted by lower taxable equivalent earnings resulting from enactment of TCJA;

• Provision for loan losses increased to $500,000 from $375,000 during the linked quarter;

• Realized securities gains of $732,000 in Q1 2018 compared to realized securities losses of $71,000 in Q4 2017;

• Write-downs of foreclosed properties were $257,000 in Q1 2018 compared to $347,000 in Q4 2017, while gains on sales of foreclosed properties increased from $46,000 in Q4 2017 to $64,000 in Q1 2018;

• Nonperforming assets as a percentage of total assets were unchanged at 1.73 percent compared to the linked quarter and declined from 2.16 percent a year-ago; and

• Quarterly dividend paid to shareholders increased 18.2 percent to $0.13 per share.

H. Charles Maddy, III, President and Chief Executive Officer of Summit, commented, “I am very pleased to report that Summit achieved both record quarterly net income and record quarterly earnings per share for the quarter just ended. Further, I am particularly gratified by our continued robust lending activity and strong core operating performance, and I optimistically look forward to the remainder of the year and beyond as we seek to be a consistent, high-performing community banking institution.”

Results of Operations

Total revenue for first quarter 2018, consisting of net interest income and noninterest income, grew 36.5 percent to $22.1 million, principally as result of the FCB acquisition, compared to $16.2 million for the first quarter 2017.

For the first quarter of 2018, net interest income was $17.3 million, an increase of 26.6 percent from the $13.6 million reported in the prior-year first quarter and decreased $181,000 compared to the linked-quarter. The net interest margin for first quarter 2018 was 3.58 percent compared to 3.54 percent for the year-ago quarter, and 3.65 percent for Q4 2017. Enactment of the TCJA reduced our net interest margin by 6 basis points in Q1 2018 as compared to Q4 2017. Excluding the impact of accretion and amortization of fair value acquisition accounting adjustments related to the interest earning assets and interest bearing liabilities acquired from FCB and HCB, Summit’s net interest margin was 3.53 percent for Q1 2018.

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 2018 was $4.88 million compared to $3.93 million for the linked-quarter and $2.58 million for the comparable period of 2017. Excluding realized securities gains and losses, noninterest income was $4.14 million for first quarter 2018, compared to $2.64 million reported for first quarter 2017 and $4.00 million for the linked quarter.

We recorded a $500,000 provision for loan losses during first quarter 2018 compared to $375,000 during fourth quarter 2017 and $250,000 for the year-ago quarter. The need for increased loan loss provisioning during Q1 2018 is principally the result of recent loan growth.

Q1 2018 total noninterest expense decreased 35.2 percent to $12.3 million compared to $19.0 million for the prior-year first quarter principally due to the $9.9 million litigation settlement to resolve fully all litigation with Residential Funding Company, LLC and ResCap Liquidating Trust (collectively “ResCap”) during Q1 2017. Excluding the impact of the ResCap litigation settlement charge, noninterest expense for Q1 2018 increased 35.1 percent to $12.4 million compared to $9.1 million for Q1 2017, principally as result of the acquisitions of HCB and FCB.

Balance Sheet

At March 31, 2018, total assets were unchanged from year-end 2017 at $2.13 billion. Total loans, net of unearned fees, were $1.64 billion at March 31, 2018, up $37.1 million, or 9.2 percent (on an annualized basis), from the $1.61 billion reported at year-end 2017. Loans, excluding mortgage warehouse lines of credit, grew $42.7 million during the quarter, or 12.3 percent (on an annualized basis).

At March 31, 2018, deposits were $1.65 billion, an increase of $53.9 million, or 3.4 percent, since year end 2017. During Q1 2018, checking deposits increased $38.4 million or 6.1 percent, time deposits grew by $26.8 million or 4.4 percent and savings deposits decreased $11.2 million or 3.1 percent.

Shareholders’ equity was $204.7 million as of March 31, 2018 compared to $201.5 million at December 31, 2017.

Tangible book value per common share increased to $14.36 at March 31, 2018 compared to $14.08 at December 31, 2017. Summit had 12,366,360 outstanding common shares at March 31, 2018 compared to 12,358,562 at year end 2017.

Asset Quality

As of March 31, 2018, nonperforming assets (“NPAs”), consisting of nonperforming loans, foreclosed properties, and repossessed assets, were unchanged from year end 2017 at $36.9 million, or 1.73 percent of assets.

First quarter 2018 net loan charge-offs were $807,000, or 0.20 percent of average loans annualized; while we added $500,000 to the allowance for loan losses through the provision for loan losses. The allowance for loan losses stood at 0.75 percent of total loans at March 31, 2018, compared to 0.78 percent at year-end 2017. If the acquired FCB and HCB loans which were recorded at fair value on the acquisition dates are excluded, the allowance for loan losses to total loans ratio at March 31, 2018 and December 31, 2017 would have been 0.85 percent and 0.91 percent, respectively.

About the Company

Summit Financial Group, Inc. is a $2.13 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 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 -- Q1 2018 vs Q1 2017
	For the Quarter Ended						Percent
Dollars in thousands	3/31/2018			3/31/2017			Change
Condensed Statements of Income (unaudited)
Interest income
Loans, including fees	$	20,366		$	15,671		30.0	%
Securities	2,391			1,851			29.2	%
Other	140			152			-7.9	%
Total interest income	22,897			17,674			29.6	%
Interest expense
Deposits	3,549			2,390			48.5	%
Borrowings	2,091			1,654			26.4	%
Total interest expense	5,640			4,044			39.5	%
Net interest income	17,257			13,630			26.6	%
Provision for loan losses	500			250			100.0	%
Net interest income after provision for loan losses	16,757			13,380			25.2	%
Noninterest income
Insurance commissions	1,113			968			15.0	%
Trust and wealth management fees	667			100			567.0	%
Service fees related to deposit accounts	1,801			1,168			54.2	%
Realized securities gains (losses)	732			(58		)	-1,362.1	%
Other income	563			401			40.4	%
Total noninterest income	4,876			2,579			89.1	%
Noninterest expense
Salaries and employee benefits	6,821			5,187			31.5	%
Net occupancy expense	832			567			46.7	%
Equipment expense	1,083			735			47.3	%
Professional fees	333			285			16.8	%
Amortization of intangibles	436			97			349.5	%
FDIC premiums	240			210			14.3	%
Merger-related expense	—			109			-100.0	%
Foreclosed properties expense	132			104			26.9	%
Gain on sales of foreclosed properties	(64		)	(156		)	-59.0	%
Write-downs of foreclosed properties	257			418			-38.5	%
Litigation settlement	—			9,900			n/a
Other expenses	2,244			1,560			43.8	%
Total noninterest expense	12,314			19,016			-35.2	%
Income (loss) before income taxes	9,319			(3,057		)	-404.8	%
Income tax expense (benefit)	1,876			(1,441		)	-230.2	%
Net income (loss)	$	7,443		$	(1,616	)	-560.6	%

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Quarterly Performance Summary -- Q1 2018 vs Q1 2017
	For the Quarter Ended						Percent
	3/31/2018			3/31/2017			Change
Per Share Data
Earnings per common share
Basic	$	0.60		$	-0.15		n/m
Diluted	$	0.60		$	-0.15		n/m
Cash dividends	$	0.13		$	0.11		18.2	%
Average common shares outstanding
Basic	12,358,849			10,738,365			15.1	%
Diluted	12,383,757			10,738,365			15.3	%
Common shares outstanding at period end	12,366,360			10,750,477			15.0	%
Performance Ratios
Return on average equity	14.73		%	-4.11		%	n/m
Return on average tangible equity	17.04		%	-4.51		%	n/m
Return on average assets	1.40		%	-0.37		%	n/m
Net interest margin	3.58		%	3.54		%	1.1	%
Efficiency ratio (A)	53.84		%	51.78		%	4.0	%
NOTE (A) - Computed on a tax equivalent basis excluding gains/losses on sales of assets, litigation settlement, write-downs of OREO properties to fair value and amortization of intangibles.

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Five Quarter Performance Summary
	For the Quarter Ended
Dollars in thousands	3/31/2018			12/31/2017			9/30/2017			6/30/2017		3/31/2017
Condensed Statements of Income (unaudited)
Interest income
Loans, including fees	$	20,366		$	20,031		$	19,490		$	19,717	$	15,671
Securities	2,391			2,412			2,397			2,349		1,851
Other	140			144			149			165		152
Total interest income	22,897			22,587			22,036			22,231		17,674
Interest expense
Deposits	3,549			3,224			2,963			2,634		2,390
Borrowings	2,091			1,925			1,841			1,749		1,654
Total interest expense	5,640			5,149			4,804			4,383		4,044
Net interest income	17,257			17,438			17,232			17,848		13,630
Provision for loan losses	500			375			375			250		250
Net interest income after provision for loan losses	16,757			17,063			16,857			17,598		13,380
Noninterest income
Insurance commissions	1,113			1,005			1,043			988		968
Trust and wealth management fees	667			578			589			595		100
Service fees related to deposit accounts	1,801			1,906			1,863			1,706		1,168
Realized securities gains (losses)	732			(71		)	26			90		(58		)
Other income	563			513			479			537		401
Total noninterest income	4,876			3,931			4,000			3,916		2,579
Noninterest expense
Salaries and employee benefits	6,821			6,520			6,610			6,758		5,187
Net occupancy expense	832			772			847			826		567
Equipment expense	1,083			1,095			1,093			1,031		735
Professional fees	333			355			373			354		285
Amortization of intangibles	436			435			448			429		97
FDIC premiums	240			250			310			295		210
Merger-related expenses	—			14			11			1,455		109
Foreclosed properties expense	132			215			171			122		104
(Gain) loss on sales of foreclosed properties	(64		)	(46		)	(29		)	73		(156		)
Write-downs of foreclosed properties	257			347			91			29		418
Litigation settlement	—			—			—			—		9,900
Other expenses	2,244			2,389			2,522			2,564		1,560
Total noninterest expense	12,314			12,346			12,447			13,936		19,016
Income (loss) before income taxes	9,319			8,648			8,410			7,578		(3,057		)
Income tax expense (benefit)	1,876			6,325			2,480			2,300		(1,441		)
Net income (loss)	$	7,443		$	2,323		$	5,930		$	5,278	$	(1,616	)

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Five Quarter Performance Summary
	For the Quarter Ended
	3/31/2018			12/31/2017			9/30/2017			6/30/2017			3/31/2017
Per Share Data
Earnings per common share
Basic	$	0.60		$	0.19		$	0.48		$	0.43		$	-0.15
Diluted	$	0.60		$	0.19		$	0.48		$	0.43		$	-0.15
Cash dividends	$	0.13		$	0.11		$	0.11		$	0.11		$	0.11
Average common shares outstanding
Basic	12,358,849			12,325,067			12,299,987			12,288,514			10,738,365
Diluted	12,383,757			12,371,507			12,318,959			12,299,187			10,738,365
Common shares outstanding at period end	12,366,360			12,358,562			12,311,723			12,299,726			10,750,477
Performance Ratios
Return on average equity	14.73		%	4.62		%	12.10		%	11.10		%	-4.11		%
Return on average tangible equity	17.04		%	5.36		%	14.12		%	12.95		%	-4.51		%
Return on average assets	1.40		%	0.44		%	1.14		%	1.01		%	-0.37		%
Net interest margin	3.58		%	3.65		%	3.65		%	3.81		%	3.54		%
Efficiency ratio (A)	53.84		%	52.44		%	54.51		%	53.55		%	51.78		%
NOTE (A) - Computed on a tax equivalent basis excluding gains/losses on sales of assets, litigation settlement, write-downs of OREO properties to fair value, merger-related expenses and amortization of intangibles.

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Selected Balance Sheet Data (unaudited)
Dollars in thousands, except per share amounts	3/31/2018			12/31/2017			9/30/2017			6/30/2017			3/31/2017
Assets
Cash and due from banks	$	9,042		$	9,641		$	9,220		$	9,294		$	19,326
Interest bearing deposits other banks	38,365			42,990			41,994			44,242			38,895
Securities	296,890			328,723			328,726			336,811			282,028
Loans, net	1,631,150			1,593,744			1,559,328			1,538,083			1,292,915
Property held for sale	21,442			21,470			22,622			23,592			23,491
Premises and equipment, net	35,554			34,209			34,220			33,234			26,377
Goodwill and other intangible assets	27,077			27,513			27,879			28,214			13,587
Cash surrender value of life insurance policies	41,668			41,358			41,076			41,189			39,412
Other assets	33,707			34,592			36,071			40,641			40,411
Total assets	$	2,134,895		$	2,134,240		$	2,101,136		$	2,095,300		$	1,776,442
Liabilities and Shareholders' Equity
Deposits	$	1,654,523		$	1,600,601		$	1,616,768		$	1,613,919		$	1,301,241
Short-term borrowings	193,513			250,499			202,988			205,728			228,868
Long-term borrowings and      subordinated debentures	65,336			65,340			65,344			65,348			65,804
Other liabilities	16,514			16,295			17,254			17,173			26,910
Shareholders' equity	205,009			201,505			198,782			193,132			153,619
Total liabilities and shareholders' equity	$	2,134,895		$	2,134,240		$	2,101,136		$	2,095,300		$	1,776,442
Book value per common share	$	16.55		$	16.30		$	16.15		$	15.70		$	14.29
Tangible book value per common share	$	14.36		$	14.08		$	13.88		$	13.41		$	13.03
Tangible common equity to tangible assets	8.4		%	8.3		%	8.2		%	8.0		%	7.9		%

SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)
Regulatory Capital Ratios
	3/31/2018		12/31/2017		9/30/2017		6/30/2017		3/31/2017
Summit Financial Group, Inc.
CET1 Risk-based Capital	10.7	%	10.6	%	10.8	%	10.5	%	10.3	%
Tier 1 Risk-based Capital	11.8	%	11.8	%	11.9	%	11.7	%	11.5	%
Total Risk Based Capital	12.5	%	12.5	%	12.7	%	12.4	%	12.3	%
Tier 1 Leverage Ratio	9.5	%	9.4	%	9.5	%	9.2	%	9.4	%
Summit Community Bank, Inc.
CET1 Risk-based Capital	11.7	%	11.7	%	11.8	%	11.6	%	11.6	%
Tier 1 Risk-based Capital	11.7	%	11.7	%	11.8	%	11.6	%	11.6	%
Total Risk Based Capital	12.5	%	12.5	%	12.6	%	12.4	%	12.4	%
Tier 1 Leverage Ratio	9.5	%	9.4	%	9.4	%	9.2	%	9.4	%

SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)
Loan Composition
Dollars in thousands	3/31/2018		12/31/2017		9/30/2017		6/30/2017		3/31/2017
Commercial	$	189,586	$	189,981	$	187,193	$	176,362	$	134,808
Mortgage warehouse lines	45,702		30,757		33,525		35,068		30,217
Commercial real estate
Owner occupied	265,075		250,202		239,840		239,108		217,733
Non-owner occupied	498,445		484,902		464,543		455,439		401,795
Construction and development
Land and development	66,841		67,219		71,412		74,155		68,079
Construction	33,327		33,412		28,756		22,967		16,511
Residential real estate
Non-jumbo	346,477		354,101		355,642		355,546		266,140
Jumbo	67,169		62,267		61,253		63,899		60,780
Home equity	83,382		84,028		82,720		81,192		75,299
Consumer	34,825		36,202		36,915		37,630		24,440
Other	12,578		13,238		9,994		9,049		8,831
Total loans, net of unearned fees	1,643,407		1,606,309		1,571,793		1,550,415		1,304,633
Less allowance for loan losses	12,257		12,565		12,465		12,332		11,718
Loans, net	$	1,631,150	$	1,593,744	$	1,559,328	$	1,538,083	$	1,292,915

SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)
Deposit Composition
Dollars in thousands	3/31/2018		12/31/2017		9/30/2017		6/30/2017		3/31/2017
Non interest bearing checking	$	219,293	$	217,493	$	215,910	$	234,173	$	152,086
Interest bearing checking	447,172		410,606		397,843		372,327		275,678
Savings	346,962		358,168		362,653		373,439		342,548
Time deposits	641,096		614,334		640,362		633,980		530,929
Total deposits	$	1,654,523	$	1,600,601	$	1,616,768	$	1,613,919	$	1,301,241

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Asset Quality Information
	For the Quarter Ended
Dollars in thousands	3/31/2018			12/31/2017			9/30/2017			6/30/2017			3/31/2017
Gross loan charge-offs	$	960		$	550		$	309		$	114		$	315
Gross loan recoveries	(153		)	(276		)	(67		)	(478		)	(108		)
Net loan charge-offs (recoveries)	$	807		$	274		$	242		$	(364	)	$	207
Net loan charge-offs to average loans (annualized)	0.20		%	0.07		%	0.06		%	-0.09		%	0.06		%
Allowance for loan losses	$	12,257		$	12,565		$	12,465		$	12,332		$	11,718
Allowance for loan losses as a percentage     of period end loans	0.75		%	0.78		%	0.79		%	0.79		%	0.90		%
Nonperforming assets:
Nonperforming loans
Commercial	$	734		$	696		$	757		$	786		$	226
Commercial real estate	3,400			3,164			2,773			2,051			4,734
Residential construction and development	3,642			3,569			3,931			3,613			3,936
Residential real estate	7,521			7,656			8,082			6,860			5,886
Consumer	160			238			529			391			162
Total nonperforming loans	15,457			15,323			16,072			13,701			14,944
Foreclosed properties
Commercial real estate	1,875			1,789			1,988			2,126			1,749
Commercial construction and development	7,140			7,392			7,392			7,527			8,276
Residential construction and development	11,053			11,182			11,852			12,402			12,635
Residential real estate	1,374			1,107			1,390			1,537			831
Total foreclosed properties	21,442			21,470			22,622			23,592			23,491
Other repossessed assets	18			68			12			57			12
Total nonperforming assets	$	36,917		$	36,861		$	38,706		$	37,350		$	38,447
Nonperforming loans to period end loans	0.94		%	0.95		%	1.02		%	0.88		%	1.15		%
Nonperforming assets to period end assets	1.73		%	1.73		%	1.84		%	1.78		%	2.16		%
Troubled debt restructurings
Performing	$	27,408		$	28,347		$	28,304		$	26,472		$	28,183
Nonperforming	76			26			760			464			719
Total troubled debt restructurings	$	27,484		$	28,373		$	29,064		$	26,936		$	28,902

Loans Past Due 30-89 Days
	For the Quarter Ended
Dollars in thousands	3/31/2018		12/31/2017		9/30/2017		6/30/2017		3/31/2017
Commercial	$	539	$	586	$	378	$	470	$	162
Commercial real estate	601		1,082		944		976		2,758
Construction and development	174		1,127		238		308		291
Residential real estate	5,218		7,236		6,260		6,943		2,924
Consumer	425		504		419		548		155
Other	15		38		92		49		17
Total	$	6,972	$	10,573	$	8,331	$	9,294	$	6,307

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Average Balance Sheet, Interest Earnings & Expenses and Average Rates
Q1 2018 vs Q1 2017
	Q1 2018							Q1 2017
	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	$	1,611,813		$	20,223	5.09	%	$	1,278,386		$	15,549	4.93	%
Tax-exempt	16,307			182		4.53	%	13,292			186		5.68	%
Securities
Taxable	191,713			1,372		2.90	%	186,332			1,128		2.46	%
Tax-exempt	132,306			1,290		3.95	%	95,300			1,112		4.73	%
Interest bearing deposits other banks    and Federal funds sold	39,656			140		1.43	%	40,698			152		1.51	%
Total interest earning assets	1,991,795			23,207		4.73	%	1,614,008			18,127		4.55	%
Noninterest earning assets
Cash & due from banks	9,962							4,631
Premises & equipment	34,586							24,504
Other assets	107,125							98,253
Allowance for loan losses	(12,737		)					(11,761		)
Total assets	$	2,130,731						$	1,729,635
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Interest bearing liabilities
Interest bearing
demand deposits	$	423,095		$	632	0.61	%	$	262,849		$	148	0.23	%
Savings deposits	346,358			717		0.84	%	339,930			625		0.75	%
Time deposits	622,543			2,200		1.43	%	540,692			1,616		1.21	%
Short-term borrowings	243,686			1,405		2.34	%	196,946			995		2.05	%
Long-term borrowings and      subordinated debentures	65,338			686		4.26	%	66,146			660		4.05	%
Total interest bearing liabilities	1,701,020			5,640		1.34	%	1,406,563			4,044		1.17	%
Noninterest bearing liabilities
Demand deposits	210,883							148,286
Other liabilities	16,771							17,700
Total liabilities	1,928,674							1,572,549
Shareholders' equity - common	202,057							157,086
Total liabilities and   shareholders' equity	$	2,130,731						$	1,729,635
NET INTEREST EARNINGS				$	17,567						$	14,083
NET INTEREST MARGIN						3.58	%						3.54	%

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Average Balance Sheet, Interest Earnings & Expenses and Average Rates
Q1 2018 vs Q4 2017
	Q1 2018							Q4 2017
	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	$	1,611,813		$	20,223	5.09	%	$	1,562,978		$	19,879	5.05	%
Tax-exempt	16,307			182		4.53	%	16,902			234		5.49	%
Securities
Taxable	191,713			1,372		2.90	%	202,377			1,328		2.60	%
Tax-exempt	132,306			1,290		3.95	%	142,641			1,668		4.64	%
Interest bearing deposits other banks    and Federal funds sold	39,656			140		1.43	%	42,021			144		1.36	%
Total interest earning assets	1,991,795			23,207		4.73	%	1,966,919			23,253		4.69	%
Noninterest earning assets
Cash & due from banks	9,962							9,753
Premises & equipment	34,586							34,263
Other assets	107,125							111,596
Allowance for loan losses	(12,737		)					(12,628		)
Total assets	$	2,130,731						$	2,109,903
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Interest bearing liabilities
Interest bearing
demand deposits	$	423,095		$	632	0.61	%	$	405,307		$	447	0.44	%
Savings deposits	346,358			717		0.84	%	360,630			684		0.75	%
Time deposits	622,543			2,200		1.43	%	629,871			2,093		1.32	%
Short-term borrowings	243,686			1,405		2.34	%	220,027			1,240		2.24	%
Long-term borrowings and      subordinated debentures	65,338			686		4.26	%	65,342			685		4.16	%
Total interest bearing liabilities	1,701,020			5,640		1.34	%	1,681,177			5,149		1.22	%
Noninterest bearing liabilities
Demand deposits	210,883							214,624
Other liabilities	16,771							12,886
Total liabilities	1,928,674							1,908,687
Shareholders' equity - common	202,057							201,216
Total liabilities and   shareholders' equity	$	2,130,731						$	2,109,903
NET INTEREST EARNINGS				$	17,567						$	18,104
NET INTEREST MARGIN						3.58	%						3.65	%