Summit Financial (SMMF) 8-K Summit Financial Group Reports Third Quarter 2006 Earnings

Exhibit 99

FOR RELEASE 6:00 AM EDT, THURSDAY, OCTOBER 19, 2006

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

SUMMIT FINANCIAL GROUP REPORTS THIRD QUARTER 2006 EARNINGS

MOOREFIELD, W.Va.--(BUSINESS WIRE)--October 19, 2006--Summit Financial Group, Inc. (NASDAQ: SMMF) today reported third quarter 2006 net income of $2.5 million, a decline of 24.2 percent from the $3.3 million reported for the third quarter of 2005. Diluted earnings per share were $0.35 compared with $0.45 for the prior-year quarter, down 22.2 percent. For the third quarter of 2006, the returns on average shareholders' equity and average assets were 12.46 percent and 0.83 percent, respectively, compared with prior-year period ratios of 18.24 percent and 1.33 percent. Results reflect continued strong loan growth from community banking operations, offset by a competitive market for deposits and a significant decline in mortgage originations.

For the nine months ended September 30, 2006, Summit reported net income of $8.1 million, a decline of 8.1 percent from the $8.8 million reported for the first nine months of 2005. Diluted earnings per share were $1.12 compared with $1.22 for the prior-year period, down 8.2 percent. Returns on average shareholders' equity and average assets for the first nine months of 2006 were 13.86 percent and 0.93 percent, respectively, compared with 2005 nine-month ratios of 16.85 percent and 1.25 percent.

H. Charles Maddy, III, President and Chief Executive Officer, commented, "The performance of our mortgage banking segment, Summit Mortgage, continues to be very disappointing. The poor results are principally the result of reduced response rates to its direct mail marketing programs. We continue to revise these programs seeking to improve their efficiency, and we believe that our most recent revisions could restore Summit Mortgage to break even or possibly modest profitability in the fourth quarter 2006. Further, we continue to evaluate this business segment strategically. Our community banking operation is performing well, and its markets have demonstrated amazing resilience, as loan growth continues to sustain net interest income growth at double-digit levels. We are pleased with the performance of this segment and optimistic for continued growth.”

THIRD QUARTER 2006 CONSOLIDATED RESULTS

Total revenue for the third quarter of 2006, consisting of net interest income plus non-interest income, was $14.3 million, a decline of 12.1 percent compared to the $16.3 million reported for the third quarter of 2005. Net interest income for the quarter increased 18.2 percent above the prior-year third quarter, to $9.2 million, reflecting 22.4 percent growth in average earning assets, partially offset by a 14 basis point decline in the net interest margin to 3.33 percent. However, compared with second quarter 2006, the net interest margin increased 1 basis point.

Non-interest income for the 2006 third quarter was $5.1 million compared with $8.5 million for the prior-year period, a decrease of 40.0 percent, reflecting a 44.9 percent decline in mortgage origination revenue from Summit Mortgage, which is discussed below.

For the third quarter of 2006, non-interest expense was $10.4 million, a 4.7 percent decrease compared to the $10.9 million reported for the third quarter of 2005; compared to the second quarter of this year, non-interest expense declined 10.4 percent (41.6 percent annualized). Salaries and employee benefit expense declined 20.8 percent compared to the year-ago period and 11.4 percent (45.6 percent annualized) versus the previous quarter, reflecting reductions in commissions and performance incentives paid relative to the Company’s mortgage banking activities. The efficiency ratio was 70.57 percent for the third quarter of 2006 compared with 65.40 percent for the prior-year third quarter; compared with the linked quarter, the efficiency ratio improved 12 basis points. (The efficiency ratio for the Company's Community Banking Segment, shown below, is a more accurate indicator of its performance compared with other community banks.)

Asset quality was fairly steady compared to the previous quarter and remains strong. Nonperforming assets were $2.2 million or 0.18 percent of assets at September 30, 2006, up slightly from $2.0 million or 0.17 percent of assets as of June 30, 2006. Net charge-offs for the third quarter of 2006 were $329,000, equivalent to 0.15 percent of average loans on an annualized basis, compared with $171,000 and 0.08 percent of loans for the preceding quarter, and $200,000 or 0.11 percent for the year-ago quarter. At period-end, loan loss reserves were 0.78 percent of loans.

Assets at September 30, 2006 were $1.21 billion, an increase of $181.4 million, or 17.6 percent over the last twelve months. Loans, net of unearned income, were $902.4 million at September 30, 2006, up $167.0 million or 22.7 percent year-over-year; since year-end 2005, loans increased $102.5 million or 12.8 percent (17.1 percent annualized). Commercial real estate and construction/development were the largest contributors to growth, up $34.4 million (12.9 percent) and $66.3 million (47.0 percent), respectively, since December 31, 2005. Together, these two categories comprised 56.2 percent of the loan portfolio, with residential mortgages accounting for an additional 31.5 percent.

Deposits at September 30, 2006 were $865.1 million, an increase of $236.1 million, or 37.5 percent above prior-year third quarter levels. Nearly $600 million of these deposits are derived from retail accounts, particularly interest bearing checking accounts, which grew $54.1 million or 31.8 percent from year-ago levels. Brokered deposits increased $159.4 million compared to the prior year.

Shareholders' equity at September 30, 2006 was $80.6 million, an increase of 11.3 percent over the last twelve months. Common shares outstanding totaled 7,102,720 at quarter-end. In August 2006, we announced a plan to repurchase up to 225,000 share of our common stock, and accordingly, during the third quarter we repurchased 32,400 shares under this plan.

OPERATING SEGMENT RESULTS

Community Banking Financial Performance

Net income for the third quarter of 2006 increased 28.9 percent over the prior-year period, to $3.5 million. Total revenue, up 18.2 percent to $10.4 million, outpaced growth in non-interest expense, up 11.7 percent to $5.0 million. The Company's efficiency ratio, excluding mortgage banking, was 49.38 percent for the third quarter of 2006 compared with 53.75 percent for the prior-year third quarter.

Mortgage Banking Financial Performance

For the third quarter of 2006, the net loss from mortgage banking activities was $735,000 compared with net income of $905,000 for the third quarter of 2005, a swing of $1.6 million. Mortgage banking fees generated from loan sales was $4.0 million, down 44.9 percent from the $7.3 million reported in the prior-year period, reflecting a 39.7 percent decrease in loan sales to $52.5 million. Revenue per loan sold decreased 7.7 percent, to $4,307 while the average loan size increased 1.0 percent to $56,145.

Loan originations in the third quarter of 2006 were $49.5 million, a decline of 26.2 percent from the linked quarter and 40.9 percent from the prior-year third quarter. Non-interest expense, primarily associated with loan originations, declined 13.4 percent to $5.2 million, compared to $6.0 million incurred in the prior-year period. Expenses per loan originated increased 54.0 percent in third quarter 2006, from $3,809 in the third quarter of 2005 to $5,866 for the current quarter.

ABOUT THE COMPANY

Summit Financial Group, Inc., a financial holding company with total assets of $1.2 billion, operates fifteen banking locations through its two wholly-owned community banks: Summit Community Bank, headquartered in Moorefield, West Virginia; and Shenandoah Valley National Bank in Winchester, Virginia. Summit also operates Summit Mortgage, a residential mortgage loan originator located in Chesapeake, Virginia and Summit Insurance Services, LLC in Moorefield, West 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 economy. We undertake no obligation to revise these statements following the date of this press release.

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Quarterly Performance Summary -- Q3 2006 vs Q3 2005
	For the Quarter Ended						Percent
Dollars in thousands, except per share amounts	9/30/2006			9/30/2005			Change
Condensed Statements of Income
Interest income
Loans, including fees	$	18,216		$	12,527			45.4	%
Securities		2,998			2,283			31.3	%
Other		16			27			-40.7	%
Total interest income		21,230			14,837			43.1	%
Interest expense
Deposits		7,761			3,509			121.2	%
Borrowings		4,239			3,518			20.5	%
Total interest expense		12,000			7,027			70.8	%
Net interest income		9,230			7,810			18.2	%
Provision for loan losses		410			424			-3.3	%
Net interest income after provision
for loan losses		8,820			7,386			19.4	%
Noninterest income
Insurance commissions		219			222			-1.4	%
Service fee income		700			711			-1.5	%
Mortgage origination revenue		4,027			7,304			-44.9	%
Securities gains (losses)		-			39			-100.0	%
Other income		131			189			-30.7	%
Total noninterest income		5,077			8,465			-40.0	%
Noninterest expense
Salaries and employee benefits		4,302			5,435			-20.8	%
Net occupancy expense		565			479			18.0	%
Equipment expense		553			465			18.9	%
Professional fees		374			230			62.6	%
Postage expense		1,678			1,451			15.6	%
Advertising		1,191			1,164			2.3	%
Other expenses		1,706			1,654			3.1	%
Total noninterest expense		10,369			10,878			-4.7	%
Income before income taxes		3,528			4,973			-29.1	%
Income taxes		1,047			1,700			-38.4	%
Net income	$	2,481		$	3,273			-24.2	%
Per Share Data
Basic earnings	$	0.35		$	0.46			-23.9	%
Diluted earnings	$	0.35		$	0.45			-22.2	%
Average shares outstanding
Basic		7,127,650			7,125,483			0.0	%
Diluted		7,187,274			7,211,331			-0.3	%
Performance Ratios
Return on average equity		12.46	%		18.24	%		-31.7	%
Return on average assets		0.83	%		1.33	%		-37.6	%
Net yield on earning assets - taxable equivalent		3.33	%		3.47	%		-4.0	%
Efficiency ratio consolidated(A)		70.57	%		65.40	%		7.9	%
Efficiency ratio excluding mortgage banking (A)		49.38	%		53.75	%		-8.1	%

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 -- 2006 vs 2005
	For the Nine Months Ended						Percent
Dollars in thousands, except per share amounts	9/30/2006			9/30/2005			Change
Condensed Statements of Income
Interest income
Loans, including fees	$	50,495		$	33,741			49.7	%
Securities		8,431			6,833			23.4	%
Other		53			79			-32.9	%
Total interest income		58,979			40,653			45.1	%
Interest expense
Deposits		19,322			8,952			115.8	%
Borrowings		12,965			9,133			42.0	%
Total interest expense		32,287			18,085			78.5	%
Net interest income		26,692			22,568			18.3	%
Provision for loan losses		1,285			1,179			9.0	%
Net interest income after provision
for loan losses		25,407			21,389			18.8	%
Noninterest income
Insurance commissions		696			605			15.0	%
Service fee income		2,056			1,909			7.7	%
Mortgage origination revenue		16,557			20,273			-18.3	%
Securities gains (losses)		-			44			-100.0	%
Other income		409			517			-20.9	%
Total noninterest income		19,718			23,348			-15.5	%
Noninterest expense
Salaries and employee benefits		14,315			15,371			-6.9	%
Net occupancy expense		1,706			1,371			24.4	%
Equipment expense		1,648			1,441			14.4	%
Professional fees		1,149			699			64.4	%
Postage expense		5,219			4,476			16.6	%
Advertising		3,845			3,711			3.6	%
Other expenses		5,577			4,739			17.7	%
Total noninterest expense		33,459			31,808			5.2	%
Income before income taxes		11,666			12,929			-9.8	%
Income taxes		3,580			4,129			-13.3	%
Net income	$	8,086		$	8,800			-8.1	%
Per Share Data
Basic earnings	$	1.13		$	1.24			-8.9	%
Diluted earnings	$	1.12		$	1.22			-8.2	%
Average shares outstanding
Basic		7,130,276			7,082,418			0.7	%
Diluted		7,194,351			7,207,937			-0.2	%
Performance Ratios
Return on average equity		13.86	%		16.85	%		-17.7	%
Return on average assets		0.93	%		1.25	%		-25.6	%
Net yield on earning assets - taxable equivalent		3.35	%		3.55	%		-5.6	%
Efficiency ratio consolidated(A)		70.12	%		67.41	%		4.0	%
Efficiency ratio excluding mortgage banking (A)		52.44	%		53.62	%		-2.2	%

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, except per share amounts	9/30/2006			6/30/2006			3/31/2006			12/31/2005			9/30/2005
Condensed Statements of Income
Interest income
Loans, including fees	$	18,216		$	16,787		$	15,492		$	14,260		$	12,527
Securities		2,998			2,787			2,647			2,368			2,283
Other		16			13			24			30			27
Total interest income		21,230			19,587			18,163			16,658			14,837
Interest expense
Deposits		7,761			6,408			5,153			4,450			3,509
Borrowings		4,239			4,348			4,379			3,971			3,518
Total interest expense		12,000			10,756			9,532			8,421			7,027
Net interest income		9,230			8,831			8,631			8,237			7,810
Provision for loan losses		410			480			395			300			424
Net interest income after provision
for loan losses		8,820			8,351			8,236			7,937			7,386
Noninterest income
Insurance commissions		219			247			230			247			222
Service fee income		700			726			631			680			711
Mortgage origination revenue		4,027			5,945			6,584			6,098			7,304
Securities gains (losses)		-			-			-			(1,434	)		39
Other income		131			136			142			(65	)		189
Total noninterest income		5,077			7,054			7,587			5,526			8,465
Noninterest expense
Salaries and employee benefits		4,302			4,855			5,158			4,944			5,435
Net occupancy expense		565			570			571			510			479
Equipment expense		553			575			520			470			465
Professional fees		374			489			285			271			230
Postage expense		1,678			1,750			1,791			1,387			1,451
Advertising		1,191			1,314			1,339			1,168			1,164
Other expenses		1,706			2,018			1,854			1,689			1,654
Total noninterest expense		10,369			11,571			11,518			10,439			10,878
Income before income taxes		3,528			3,834			4,305			3,024			4,973
Income taxes		1,047			1,200			1,334			582			1,700
Net income	$	2,481		$	2,634		$	2,971		$	2,442		$	3,273
Per Share Data
Basic earnings	$	0.35		$	0.37		$	0.42		$	0.34		$	0.46
Diluted earnings	$	0.35		$	0.37		$	0.41		$	0.34		$	0.45
Average shares outstanding
Basic		7,127,650			7,135,107			7,128,076			7,125,994			7,125,483
Diluted		7,187,274			7,193,407			7,192,924			7,198,068			7,211,331
Performance Ratios
Return on average equity		12.46	%		13.53	%		15.60	%		13.15	%		18.24	%
Return on average assets		0.83	%		0.91	%		1.05	%		0.92	%		1.33	%
Net interest margin - taxable equivalent		3.33	%		3.32	%		3.39	%		3.39	%		3.47	%
Efficiency ratio consolidated (A)		70.57	%		70.69	%		69.16	%		65.50	%		65.40	%
Efficiency ratio excluding mortgage banking (A)		49.38	%		54.33	%		53.76	%		50.73	%		53.75	%

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

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Segment Information
For the Quarter Ended September 30, 2006
	Community			Mortgage			Parent
Dollars in thousands	Banking			Banking			and Other			Eliminations			Total
Condensed Statements of Income
Interest income	$	21,096		$	300		$	12		$	(178	)	$	21,230
Interest expense		11,570			144			464			(178	)		12,000
Net interest income		9,526			156			(452	)		-			9,230
Provision for loan losses		260			150			-			-			410
Net interest income after provision
for loan losses		9,266			6			(452	)		-			8,820
Noninterest income		904			4,027			1,608			(1,462	)		5,077
Noninterest expense		4,954			5,168			1,709			(1,462	)		10,369
Income before income taxes		5,216			(1,135	)		(553	)		-			3,528
Income taxes		1,669			(400	)		(222	)		-			1,047
Net income	$	3,547		$	(735	)	$	(331	)	$	-		$	2,481
Intersegment revenue (expense)	$	(1,235	)	$	(219	)	$	1,454		$	-		$	-
Average assets	$	1,182,638		$	12,335		$	103,493		$	(104,318	)	$	1,194,148

Segment Information
For the Quarter Ended September 30, 2005
	Community			Mortgage			Parent
Dollars in thousands	Banking			Banking			and Other			Eliminations			Total
Condensed Statements of Income
Interest income	$	14,619		$	516		$	7		$	(305	)	$	14,837
Interest expense		6,805			304			223			(305	)		7,027
Net interest income		7,814			212			(216	)		-			7,810
Provision for loan losses		360			64			-			-			424
Net interest income after provision
for loan losses		7,454			148			(216	)		-			7,386
Noninterest income		1,012			7,304			1,362			(1,213	)		8,465
Noninterest expense		4,437			5,969			1,685			(1,213	)		10,878
Income before income taxes		4,029			1,483			(539	)		-			4,973
Income taxes		1,277			578			(155	)		-			1,700
Net income	$	2,752		$	905		$	(384	)	$	-		$	3,273
Intersegment revenue (expense)	$	(841	)	$	(364	)	$	1,205		$	-		$	-
Average assets	$	974,653		$	24,144		$	85,012		$	(98,603	)	$	985,206

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Segment Information
For the Nine Months Ended September 30, 2006
	Community			Mortgage			Parent
Dollars in thousands	Banking			Banking			and Other			Eliminations			Total
Condensed Statements of Income
Interest income	$	58,394		$	1,274		$	35		$	(724	)	$	58,979
Interest expense		31,079			689			1,243			(724	)		32,287
Net interest income		27,315			585			(1,208	)		-			26,692
Provision for loan losses		915			370			-			-			1,285
Net interest income after provision
for loan losses		26,400			215			(1,208	)		-			25,407
Noninterest income		2,637			16,557			4,949			(4,425	)		19,718
Noninterest expense		15,101			17,374			5,409			(4,425	)		33,459
Income before income taxes		13,936			(602	)		(1,668	)		-			11,666
Income taxes		4,445			(192	)		(673	)		-			3,580
Net income	$	9,491		$	(410	)	$	(995	)	$	-		$	8,086
Intersegment revenue (expense)	$	(3,486	)	$	(914	)	$	4,400		$	-		$	-
Average assets	$	1,149,873		$	17,606		$	100,530		$	(107,825	)	$	1,160,184

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Segment Information
For the Nine Months Ended September 30, 2005
	Community			Mortgage			Parent
Dollars in thousands	Banking			Banking			and Other			Eliminations			Total
Condensed Statements of Income
Interest income	$	40,151		$	1,303		$	19		$	(820	)	$	40,653
Interest expense		17,501			816			588			(820	)		18,085
Net interest income		22,650			487			(569	)		-			22,568
Provision for loan losses		1,035			144			-			-			1,179
Net interest income after provision
for loan losses		21,615			343			(569	)		-			21,389
Noninterest income		2,606			20,273			4,041			(3,572	)		23,348
Noninterest expense		13,007			17,622			4,751			(3,572	)		31,808
Income before income taxes		11,214			2,994			(1,279	)		-			12,929
Income taxes		3,527			1,108			(506	)		-			4,129
Net income	$	7,687		$	1,886		$	(773	)	$	-		$	8,800
Intersegment revenue (expense)	$	(2,568	)	$	(981	)	$	3,549		$	-		$	-
Average assets	$	926,954		$	22,471		$	82,157		$	(94,014	)	$	937,568

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Selected Balance Sheet Data
	For the Quarter Ended
Dollars in thousands, except per share amounts	9/30/2006		6/30/2006		3/31/2006		12/31/2005		9/30/2005
Assets	$	1,210,491	$	1,179,648	$	1,137,692	$	1,109,532	$	1,029,103
Securities		246,332		238,382		233,805		223,772		215,757
Loans held for sale, net		6,510		9,702		12,343		16,585		12,695
Loans, net		895,266		866,680		825,022		793,767		729,431
Intangible assets		3,234		3,272		3,310		3,348		3,385
Retail deposits		598,293		570,731		560,551		545,104		521,503
Brokered time deposits		266,769		190,832		170,185		128,797		107,416
Short-term borrowings		90,422		164,185		136,483		182,028		139,681
Long-term borrowings and
subordinated debentures		163,864		167,168		183,136		170,501		179,383
Shareholders' equity		80,630		76,559		75,816		73,803		72,429
Book value per share	$	11.35	$	10.73	$	10.63	$	10.36	$	10.16

SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)
Loan Composition
Dollars in thousands	9/30/2006		6/30/2006		3/31/2006		12/31/2005		9/30/2005
Commercial	$	67,352	$	64,342	$	66,564	$	63,206	$	60,723
Commercial real estate		300,675		296,680		275,896		266,228		*
Construction and development		207,545		182,000		165,026		141,207		*
Residential real estate		284,636		288,991		282,013		285,597		*
Consumer		36,885		37,040		37,357		36,863		37,431
Other		7,086		6,188		6,382		8,598		8,824
Total loans		904,179		875,241		833,238		801,699		736,992
Less unearned fees and interest		1,806		1,767		1,731		1,780		1,640
Total loans net of unearned fees and interest		902,373		873,474		831,507		799,919		735,352
Less allowance for loan losses		7,107		6,794		6,485		6,152		5,921
Loans, net	$	895,266	$	866,680	$	825,022	$	793,767	$	729,431

        * - Due to reclassification of real estate loans to include construction and development category, real estate loan balances prior to 12/31/05 conforming to the new classifications is not available.

SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)
Retail Deposit Composition
Dollars in thousands	9/30/2006		6/30/2006		3/31/2006		12/31/2005		9/30/2005
Non interest bearing checking	$	64,751	$	66,071	$	62,860	$	62,631	$	69,346
Interest bearing checking		223,992		214,279		214,572		200,638		169,893
Savings		44,980		38,737		39,474		44,681		45,868
Time deposits		264,570		251,644		243,645		237,154		236,396
Total retail deposits	$	598,293	$	570,731	$	560,551	$	545,104	$	521,503

SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)
Mortgage Banking Segment Loan Activity
	For the Quarter Ended
Dollars in thousands	9/30/2006		6/30/2006		3/31/2006		12/31/2005		9/30/2005
Loans originated
Amount	$	49,545	$	67,130	$	72,967	$	78,297	$	83,860
Number		881		1,222		1,386		1,443		1,567
Loans sold
Amount	$	52,496	$	69,315	$	76,375	$	73,903	$	87,071
Number		935		1,304		1,421		1,376		1,566

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Asset Quality Information
	For the Quarter Ended
Dollars in thousands	9/30/2006			6/30/2006			3/31/2006			12/31/2005			9/30/2005
Net loan charge-off's	$	329		$	171		$	62		$	70		$	200
Net loan charge-off's to average loans (annualized)		0.15	%		0.08	%		0.03	%		0.04	%		0.11	%
Allowance for loan losses	$	7,107		$	6,794		$	6,485		$	6,152		$	5,921
Allowance for loan losses as a percentage
of period end loans		0.78	%		0.77	%		0.77	%		0.75	%		0.79	%
Nonperforming assets:
Nonperforming loans	$	1,966		$	1,593		$	1,972		$	1,382		$	1,017
Foreclosed properties and
other repossessed assets		255			373			346			395			862
Total	$	2,221		$	1,966		$	2,318		$	1,777		$	1,879
Nonperforming loans to period end loans		0.22	%		0.18	%		0.23	%		0.17	%		0.14	%
Nonperforming assets to period end assets		0.18	%		0.17	%		0.20	%		0.16	%		0.18	%

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Average Balance Sheet, Interest Earnings & Expenses and Average Rates
Q3 2006 vs Q3 2005
	Q3 2006								Q3 2005
	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	$	884,917		$	18,103		8.12	%	$	705,853		$	12,423		6.98	%
Tax-exempt		8,631			171		7.86	%		8,574			157		7.26	%
Securities
Taxable		192,475			2,452		5.05	%		164,390			1,750		4.22	%
Tax-exempt		47,842			817		6.78	%		47,750			798		6.63	%
Interest bearing deposits other banks
and Federal funds sold		3,559			16		1.78	%		2,726			28		4.08	%
Total interest earning assets		1,137,424			21,559		7.52	%		929,293			15,156		6.47	%
Noninterest earning assets
Cash & due from banks		12,791								19,124
Premises & equipment		23,703								20,759
Other assets		27,224								21,842
Allowance for loan losses		(6,994	)							(5,812	)
Total assets	$	1,194,148							$	985,206
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Interest bearing liabilities
Interest bearing
demand deposits	$	221,297		$	2,044		3.66	%	$	153,329		$	843		2.18	%
Savings deposits		42,038			164		1.55	%		46,226			77		0.66	%
Time deposits		478,992			5,553		4.60	%		320,708			2,589		3.20	%
Short-term borrowings		132,680			1,777		5.31	%		142,240			1,315		3.67	%
Long-term borrowings and
subordinated debentures		164,996			2,462		5.92	%		178,145			2,203		4.91	%
		1,040,003			12,000		4.58	%		840,648			7,027		3.32	%
Noninterest bearing liabilities
Demand deposits		64,043								65,449
Other liabilities		10,470								7,338
Total liabilities		1,114,516								913,435
Shareholders' equity		79,632								71,771
Total liabilities and
shareholders' equity	$	1,194,148							$	985,206
NET INTEREST EARNINGS				$	9,559							$	8,129
NET INTEREST YIELD ON EARNING ASSETS							3.33	%							3.47	%

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Average Balance Sheet, Interest Earnings & Expenses and Average Rates
YTD 2006 vs YTD 2005
	For the Nine Months Ended September 30,
	2006								2005
	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	$	857,851		$	50,180		7.82	%	$	663,287		$	33,421		6.74	%
Tax-exempt		8,373			476		7.60	%		8,884			485		7.30	%
Securities
Taxable		189,768			6,837		4.82	%		162,852			5,229		4.29	%
Tax-exempt		45,950			2,385		6.94	%		47,984			2,402		6.69	%
Interest bearing deposits other banks
and Federal funds sold		1,453			52		4.78	%		2,766			79		3.82	%
Total interest earning assets		1,103,395			59,930		7.26	%		885,773			41,616		6.28	%
Noninterest earning assets
Cash & due from banks		13,760								16,567
Premises & equipment		23,552								20,730
Other assets		26,160								20,008
Allowance for loan losses		(6,683	)							(5,510	)
Total assets	$	1,160,184							$	937,568
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Interest bearing liabilities
Interest bearing
demand deposits	$	213,518		$	5,410		3.39	%	$	141,168		$	1,868		1.77	%
Savings deposits		40,826			311		1.02	%		48,699			235		0.65	%
Time deposits		428,224			13,601		4.25	%		308,334			6,849		2.97	%
Short-term borrowings		148,876			5,572		5.00	%		131,459			3,124		3.18	%
Long-term borrowings and
subordinated debentures		176,250			7,393		5.61	%		171,300			6,009		4.69	%
		1,007,694			32,287		4.28	%		800,960			18,085		3.02	%
Noninterest bearing liabilities
Demand deposits		64,618								60,252
Other liabilities		10,059								6,707
Total liabilities		1,082,371								867,919
Shareholders' equity		77,813								69,649
Total liabilities and
shareholders' equity	$	1,160,184							$	937,568
NET INTEREST EARNINGS				$	27,643							$	23,531
NET INTEREST YIELD ON EARNING ASSETS							3.35	%							3.55	%