Summit Financial (SMMF) 8-K Summit Financial Group Reports First Quarter 2016 Results

EXHIBIT 99

FOR RELEASE 6:00 AM ET, April 25, 2016

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

Telephone:(304) 530-0552

Email:rtissue@summitfgi.com

SUMMIT FINANCIAL GROUP REPORTS FIRST QUARTER 2016 RESULTS

Q1 2016 Diluted EPS $0.38 compared to $0.41 for Q1 2015 and to $0.39 for Q4 2015

MOOREFIELD, WV - April 25, 2016 (GLOBE NEWSWIRE) - Summit Financial Group, Inc. (“Company” or “Summit”) (NASDAQ: SMMF) today reported first quarter 2016 net income of $4.06 million, or $0.38 per diluted share, representing a decrease of 5.2 percent, or 7.3 percent per diluted share, compared to the $4.29 million, or $0.41 per diluted share, reported for the first quarter of 2015, and a decrease of 2.0 percent, or 2.6 percent per diluted share, compared to the $4.15 million, or $0.39 per diluted share, reported for the fourth quarter of 2015. Q1 2016 earnings compared to Q1 2015 and Q4 2015 were negatively impacted by increased personnel costs and other noninterest expenses as well as reductions in insurance commission revenue, which were partially offset by increased net interest earnings and reductions in write-downs of foreclosed properties.

Excluding from first quarter 2016 one-time items of income, gain, expense and loss, Q1 2016 core earnings approximated $3.96 million, or $0.37 per diluted share compared to Q1 2015 core earnings of $4.33 million, or $0.40 per diluted share, and to Q4 2015 core earnings of $4.08 million, or $0.38 per diluted share.

Highlights for Q1 2016 include:

• Net interest margin remained stable compared to the linked quarter, but has declined 9 basis points since Q1 2015.

• Achieved loan growth of $17.3 million or 6.3 percent (on an annualized basis). Loans have grown $57.6 million or 5.5 percent since Q1 2015.

• Core revenue for the quarter is unchanged compared to Q4 2015, and is up $189,000 or 1.3 percent compared to Q1 2015.

• Nonperforming assets as a percentage of total assets declined to 2.66 percent compared to 2.77 percent for the linked quarter, and 3.18 percent at Q1 2015; foreclosed properties are at the lowest level since Q2 2009.

• Recorded charges of $109,000 to write-down foreclosed properties compared to $636,000 in Q4 2015 and $572,000 in Q1 2015.

• Announced our entering into a definitive merger agreement to acquire Highland County Bankshares, Inc. headquartered in Monterey, Virginia.

H. Charles Maddy III, President and Chief Executive Officer of Summit, commented, “I am pleased to report Summit achieved another quarter of solid performance, despite the challenges of higher overhead costs resulting from important investments we are making in both our people and in our infrastructure to assist to maintain our growth momentum. Our solid core earnings, growing loan portfolio and continued reductions in our portfolio of problem assets are all very gratifying to note; but I am particularly gratified by the opportunity represented by our pending acquisition of Highland County Bankshares. This deal will combine two financially strong banks with similar cultures, core values and guiding principles, as well as a shared commitment to build long-term client relationships by providing service beyond expectations.”

Results from Operations

Total revenue for first quarter 2016, consisting of net interest income and noninterest income, declined 0.5 percent to $14.6 million compared to $14.7 million for the first quarter 2015, and was unchanged compared to the linked quarter.

Total core revenue (excluding nonrecurring items, enumerated above) was $14.2 million for first quarter 2015, $14.0 million for the same prior-year quarter and $14.2 million for the linked quarter.

For the first quarter of 2016, net interest income was $11.8 million, an increase of 2.2 percent from the $11.5 million reported in the prior-year first quarter and increased $46,000 compared to the linked quarter. The net interest margin for first quarter 2016 was 3.50 percent compared to 3.59 percent for the year-ago quarter, and 3.51 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 first quarter 2016 was $2.81 million compared to $3.14 million for the comparable period of 2015 and $2.87 million for Q4 2015. Excluding realized securities gains, noninterest income was $2.41 million for first quarter 2016 compared to $2.66 million reported for first quarter 2015 and $2.45 million for linked quarter. The quarter over year-ago quarter decline principally resulted from decreased insurance commission revenues, while the decline compared to the linked quarter was due to lower service fees on deposit accounts.

Summit recognized $250,000 provision for loan losses in first quarter 2016, as well as for the linked quarter and for the year-ago quarter.

Total noninterest expense increased 4.3% to $8.55 million compared to $8.20 million for the prior-year first quarter and increased 0.7 percent compared to $8.49 million for the linked quarter. Excluding from noninterest expense merger expenses, gains and losses on sales of foreclosed properties and write-downs of foreclosed properties, noninterest expense would have approximated $8.34 million for Q1 2016, $7.48 million for the comparable period of 2015 and $8.17 million for linked quarter. The Q1 2016 compared to Q1 2015 increase is primarily due to net additions of staff, general merit raises and higher incentive compensation.

Balance Sheet

At March 31, 2016, total assets were $1.51 billion, an increase of $16.1 million, or 1.1 percent since December 31, 2015. Total loans, net of unearned fees and allowance for loan losses, were $1.10 billion at March 31, 2016, up $17.5 million, or 1.6 percent, from the $1.08 billion reported at year-end 2015.

At March 31, 2016, deposits were $1.09 billion, an increase of $27.8 million, or 2.6 percent, since year end 2015. During Q1 2016, checking deposits declined by $1.5 million or 0.4 percent, while savings deposits increased $19.9 million, or 7.4 percent.

2

Asset Quality

As of March 31, 2016, nonperforming assets (“NPAs”), consisting of nonperforming loans, foreclosed properties, and repossessed assets, were $40.1 million, or 2.66 percent of assets. This compares to $41.3 million, or 2.77 percent of assets at the linked quarter, and $46.4 million, or 3.18 percent of assets, at first quarter 2015.

First quarter 2016 net loan charge-offs were $407,000, or 0.15 percent of average loans on an annualized basis. The allowance for loan losses stood at $11.3 million, or 1.02 percent of total loans at March 31, 2016, compared to 1.05 percent at year-end 2015.

Capital Adequacy

Shareholders’ equity was $146.1 million as of March 31, 2016 compared to $143.7 million December 31, 2015. Tangible book value per common share increased to $12.98 at March 31, 2016 compared to $12.78 at December 31, 2015. Summit had 10,681,880 outstanding common shares at Q1 2016 quarter end compared to 10,671,744 at year end 2015.

Summit's depository institution, Summit Community Bank, Inc. (the “Bank”), is well in excess of regulatory requirements for a "well capitalized" institution at March 31, 2016. The Bank’s total risk-based capital ratio was 14.5 percent at both March 31, 2016 and December 31, 2015, while its Tier 1 leverage capital ratio was 10.7 percent at March 31, 2016 compared to the 10.8 percent reported at December 31, 2015.

About the Company

Summit Financial Group, Inc. is a $1.51 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 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.

3

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Quarterly Performance Summary -- Q1 2016 vs Q1 2015
	For the Quarter Ended					Percent
Dollars in thousands	3/31/2016			3/31/2015		Change
Condensed Statements of Income
Interest income
Loans, including fees	$	13,436		$	12,848	4.6	%
Securities	1,726			1,894		-8.9	%
Other	3			1		200.0	%
Total interest income	15,165			14,743		2.9	%
Interest expense
Deposits	2,170			2,071		4.8	%
Borrowings	1,216			1,152		5.6	%
Total interest expense	3,386			3,223		5.1	%
Net interest income	11,779			11,520		2.2	%
Provision for loan losses	250			250		—	%
Net interest income after provision for loan losses	11,529			11,270		2.3	%
Noninterest income
Insurance commissions	924			1,128		-18.1	%
Service fees related to deposit accounts	978			976		0.2	%
Realized securities gains	393			480		-18.1	%
Other income	511			555		-7.9	%
Total noninterest income	2,806			3,139		-10.6	%
Noninterest expense
Salaries and employee benefits	4,682			4,187		11.8	%
Net occupancy expense	540			498		8.4	%
Equipment expense	656			535		22.6	%
Professional fees	472			335		40.9	%
FDIC premiums	300			330		-9.1	%
Merger expense	112			—		n/a
Foreclosed properties expense	124			208		-40.4	%
Loss (gain) on sales of foreclosed properties	(6		)	150		-104.0	%
Write-downs of foreclosed properties	109			572		-80.9	%
Other expenses	1,565			1,389		12.7	%
Total noninterest expense	8,554			8,204		4.3	%
Income before income taxes	5,781			6,205		-6.8	%
Income taxes	1,719			1,920		-10.5	%
Net income	$	4,062		$	4,285	-5.2	%

4

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Quarterly Performance Summary -- Q1 2016 vs Q1 2015
	For the Quarter Ended						Percent
	3/31/2016			3/31/2015			Change
Per Share Data
Earnings per common share
Basic	$	0.38		$	0.49		-22.4	%
Diluted	$	0.38		$	0.41		-7.3	%
Cash dividends	$	0.10		$	0.08		25.0	%
Average common shares outstanding
Basic	10,671,856			8,815,961			21.1	%
Diluted	10,679,301			10,493,323			1.8	%
Common shares outstanding at period end	10,681,880			10,586,242			0.9	%
Performance Ratios
Return on average equity	11.10		%	12.79		%	-13.2	%
Return on average tangible equity	11.70		%	13.56		%	-13.7	%
Return on average assets	1.08		%	1.18		%	-8.5	%
Net interest margin	3.50		%	3.59		%	-2.5	%
Efficiency ratio (A)	55.93		%	49.27		%	13.5	%
NOTE (A) - Computed on a tax equivalent basis excluding nonrecurring income and expense items and amortization of intangibles.

5

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Five Quarter Performance Summary
	For the Quarter Ended
Dollars in thousands	3/31/2016			12/31/2015			9/30/2015		6/30/2015		3/31/2015
Condensed Statements of Income
Interest income
Loans, including fees	$	13,436		$	13,265		$	12,983	$	12,972	$	12,848
Securities	1,726			1,685			1,543		1,685		1,894
Other	3			1			5		1		1
Total interest income	15,165			14,951			14,531		14,658		14,743
Interest expense
Deposits	2,170			2,085			2,106		2,074		2,071
Borrowings	1,216			1,133			1,120		1,126		1,152
Total interest expense	3,386			3,218			3,226		3,200		3,223
Net interest income	11,779			11,733			11,305		11,458		11,520
Provision for loan losses	250			250			250		500		250
Net interest income after provision for loan losses	11,529			11,483			11,055		10,958		11,270
Noninterest income
Insurance commissions	924			851			983		1,080		1,128
Service fees related to deposit accounts	978			1,126			1,111		1,072		976
Realized securities gains	393			421			372		170		480
Other income	511			471			527		538		555
Total noninterest income	2,806			2,869			2,993		2,860		3,139
Noninterest expense
Salaries and employee benefits	4,682			4,530			4,479		4,442		4,187
Net occupancy expense	540			481			496		489		498
Equipment expense	656			617			582		560		535
Professional fees	472			507			402		372		335
FDIC premiums	300			270			300		320		330
Merger expense	112			—			—		—		—
Foreclosed properties expense	124			150			168		158		208
Loss (gain) on sale of foreclosed properties	(6		)	(314		)	35		103		150
Write-downs of foreclosed properties	109			636			1,046		160		572
Other expenses	1,565			1,617			1,364		1,457		1,389
Total noninterest expense	8,554			8,494			8,872		8,061		8,204
Income before income taxes	5,781			5,858			5,176		5,757		6,205
Income taxes	1,719			1,712			1,515		1,747		1,920
Net income	$	4,062		$	4,146		$	3,661	$	4,010	$	4,285

6

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Five Quarter Performance Summary
	For the Quarter Ended
	3/31/2016			12/31/2015			9/30/2015			6/30/2015			3/31/2015
Per Share Data
Earnings per common share
Basic	$	0.38		$	0.39		$	0.34		$	0.38		$	0.49
Diluted	$	0.38		$	0.39		$	0.34		$	0.38		$	0.41
Cash dividends	$	0.10		$	0.08		$	0.08		$	0.08		$	0.08
Average common shares outstanding
Basic	10,671,856			10,661,700			10,703,526			10,667,892			8,815,961
Diluted	10,679,301			10,669,192			10,712,203			10,676,474			10,493,323
Common shares outstanding at period end	10,681,880			10,671,744			10,658,199			10,843,676			10,586,242
Performance Ratios
Return on average equity	11.10		%	11.66		%	10.42		%	11.67		%	12.79		%
Return on average tangible equity	11.70		%	12.31		%	11.01		%	12.36		%	13.56		%
Return on average assets	1.08		%	1.12		%	1.00		%	1.09		%	1.18		%
Net interest margin	3.50		%	3.51		%	3.41		%	3.49		%	3.59		%
Efficiency ratio - (A)	55.93		%	54.46		%	52.93		%	52.05		%	49.27		%
NOTE (A) - Computed on a tax equivalent basis excluding nonrecurring income and expense items and amortization of intangibles.

7

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Selected Balance Sheet Data
	For the Quarter Ended
Dollars in thousands, except per share amounts	3/31/2016			12/31/2015			9/30/2015			6/30/2015			3/31/2015
Assets
Cash and due from banks	$	4,005		$	3,625		$	4,232		$	3,988		$	3,850
Interest bearing deposits other banks	12,655			5,862			8,057			9,274			8,437
Securities	271,515			280,792			272,127			276,661			282,135
Loans, net	1,096,790			1,079,331			1,062,348			1,064,472			1,039,669
Property held for sale	24,684			25,567			29,713			31,500			34,368
Premises and equipment, net	21,589			21,572			20,457			20,490			20,208
Intangible assets	7,448			7,498			7,548			7,598			7,648
Cash surrender value of life insurance policies	37,989			37,732			37,482			37,222			36,961
Other assets	31,893			30,450			27,340			28,764			27,216
Total assets	$	1,508,568		$	1,492,429		$	1,469,304		$	1,479,969		$	1,460,492
Liabilities and Shareholders' Equity
Deposits	$	1,094,544		$	1,066,709		$	1,072,091		$	1,053,310		$	1,058,308
Short-term borrowings	153,448			171,394			145,291			174,599			148,985
Long-term borrowings and      subordinated debentures	94,692			95,170			95,648			98,625			101,602
Other liabilities	19,755			15,412			15,985			13,363			15,708
Shareholders' equity	146,129			143,744			140,289			140,072			135,889
Total liabilities and shareholders' equity	$	1,508,568		$	1,492,429		$	1,469,304		$	1,479,969		$	1,460,492
Book value per common share (A)	$	13.68		$	13.48		$	13.16		$	12.92		$	12.84
Tangible book value per common share (A)	$	12.98		$	12.78		$	12.45		$	12.22		$	12.11
Tangible equity to tangible assets	9.2		%	9.2		%	9.1		%	9.0		%	8.8		%
Tangible common equity to tangible assets	9.2		%	9.2		%	9.1		%	9.0		%	8.8		%
NOTE (A) - Computed on a fully-diluted basis assuming conversion of preferred stock

SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)
Regulatory Capital Ratios (A)
	3/31/2016		12/31/2015		9/30/2015		6/30/2015		3/31/2015
Summit Financial Group, Inc.
CET1 Risk-based Capital	11.9	%	11.8	%	11.7	%	11.6	%	11.3	%
Tier 1 Risk-based Capital	13.5	%	13.4	%	13.4	%	13.2	%	13.0	%
Total Risk Based Capital	14.5	%	14.4	%	14.4	%	14.2	%	14.0	%
Tier 1 Leverage Ratio	10.7	%	10.7	%	10.5	%	10.4	%	10.1	%
Summit Community Bank, Inc.
CET1 Risk-based Capital	13.6	%	13.6	%	13.6	%	13.4	%	13.5	%
Tier 1 Risk-based Capital	13.6	%	13.6	%	13.6	%	13.4	%	13.5	%
Total Risk Based Capital	14.5	%	14.5	%	14.6	%	14.4	%	14.5	%
Tier 1 Leverage Ratio	10.7	%	10.8	%	10.7	%	10.6	%	10.5	%
NOTE (A) - Computed in accordance with Basel III regulatory capital guidelines beginning January 1, 2015

8

SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)
Loan Composition
Dollars in thousands	3/31/2016		12/31/2015		9/30/2015		6/30/2015		3/31/2015
Commercial	$	101,743	$	97,201	$	89,250	$	97,284	$	89,928
Commercial real estate
Owner occupied	202,680		203,555		199,068		191,743		180,269
Non-owner occupied	353,350		337,295		336,550		331,056		325,764
Construction and development
Land and development	66,483		65,500		66,164		64,435		66,558
Construction	7,997		9,970		8,419		18,214		19,094
Residential real estate
Non-jumbo	221,368		221,749		222,739		220,199		219,938
Jumbo	50,057		50,313		46,092		49,203		50,492
Home equity	74,097		74,300		73,652		72,504		68,894
Consumer	19,095		19,251		19,124		18,683		18,485
Other	11,235		11,669		12,518		12,423		11,074
Total loans, net of unearned fees	1,108,105		1,090,803		1,073,576		1,075,744		1,050,496
Less allowance for loan losses	11,315		11,472		11,228		11,272		10,827
Loans, net	$	1,096,790	$	1,079,331	$	1,062,348	$	1,064,472	$	1,039,669

SUMMIT FINANCIAL GROUP INC. (NASDAQ: SMMF)
Deposit Composition
Dollars in thousands	3/31/2016		12/31/2015		9/30/2015		6/30/2015		3/31/2015
Non interest bearing checking	$	122,378	$	119,010	$	118,887	$	113,256	$	117,049
Interest bearing checking	210,878		215,721		217,242		202,957		196,606
Savings	286,695		266,825		259,185		246,949		257,687
Time deposits	474,593		465,153		476,777		490,148		486,966
Total deposits	$	1,094,544	$	1,066,709	$	1,072,091	$	1,053,310	$	1,058,308

9

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Asset Quality Information
	For the Quarter Ended
Dollars in thousands	3/31/2016			12/31/2015			9/30/2015			6/30/2015			3/31/2015
Gross loan charge-offs	$	561		$	132		$	774		$	463		$	782
Gross loan recoveries	(154		)	(126		)	(481		)	(407		)	(192		)
Net loan charge-offs	$	407		$	6		$	293		$	56		$	590
Net loan charge-offs to average loans (annualized)	0.15		%	—		%	0.11		%	0.02		%	0.23		%
Allowance for loan losses	$	11,315		$	11,472		$	11,228		$	11,272		$	10,827
Allowance for loan losses as a percentage     of period end loans	1.02		%	1.05		%	1.05		%	1.05		%	1.03		%
Nonperforming assets:
Nonperforming loans
Commercial	$	430		$	853		$	884		$	1,065		$	788
Commercial real estate	6,140			5,955			5,294			2,421			1,340
Commercial construction and development	—			—			—			—			—
Residential construction and development	5,467			5,623			5,345			5,627			5,333
Residential real estate	3,248			3,245			3,881			4,433			4,491
Consumer	121			92			53			45			65
Total nonperforming loans	15,406			15,768			15,457			13,591			12,017
Foreclosed properties
Commercial	—			—			—			—			110
Commercial real estate	976			1,300			3,209			3,279			3,657
Commercial construction and development	8,717			8,717			9,328			10,178			10,191
Residential construction and development	13,808			14,068			14,965			15,839			17,590
Residential real estate	1,183			1,482			2,211			2,204			2,819
Total foreclosed properties	24,684			25,567			29,713			31,500			34,367
Other repossessed assets	—			5			—			55			55
Total nonperforming assets	$	40,090		$	41,340		$	45,170		$	45,146		$	46,439
Nonperforming loans to period end loans	1.39		%	1.45		%	1.44		%	1.26		%	1.14		%
Nonperforming assets to period end assets	2.66		%	2.77		%	3.07		%	3.05		%	3.18		%

Loans Past Due 30-89 Days
	For the Quarter Ended
In thousands	3/31/2016		12/31/2015		9/30/2015		6/30/2015		3/31/2015
Commercial	$	465	$	339	$	42	$	344	$	387
Commercial real estate	920		543		1,926		4,945		783
Construction and development	218		1,182		39		21		2,735
Residential real estate	3,055		4,442		3,888		3,932		3,614
Consumer	73		186		216		211		148
Other	14		9		9		7		18
Total	$	4,745	$	6,701	$	6,120	$	9,460	$	7,685

10

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Average Balance Sheet, Interest Earnings & Expenses and Average Rates
Q1 2016 vs Q1 2015
	Q1 2016							Q1 2015
	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	$	1,089,083		$	13,291	4.91	%	$	1,035,610		$	12,734	4.99	%
Tax-exempt	15,824			220		5.59	%	12,567			174		5.62	%
Securities
Taxable	209,365			1,083		2.08	%	211,471			1,281		2.46	%
Tax-exempt	79,314			974		4.94	%	76,012			927		4.95	%
Interest bearing deposits other banks    and Federal funds sold	8,092			3		0.15	%	7,081			1		0.06	%
Total interest earning assets	1,401,678			15,571		4.47	%	1,342,741			15,117		4.57	%
Noninterest earning assets
Cash & due from banks	3,762							3,679
Premises & equipment	21,594							20,203
Other assets	89,642							98,685
Allowance for loan losses	(11,562		)					(11,237		)
Total assets	$	1,505,114						$	1,454,071
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Interest bearing liabilities
Interest bearing
demand deposits	$	209,733		$	83	0.16	%	$	199,840		$	58	0.12	%
Savings deposits	277,396			506		0.73	%	254,398			428		0.68	%
Time deposits	471,597			1,581		1.35	%	485,975			1,585		1.32	%
Short-term borrowings	168,548			240		0.57	%	144,779			112		0.31	%
Long-term borrowings and      subordinated debentures	95,052			976		4.13	%	105,741			1,040		3.99	%
Total interest bearing liabilities	1,222,326			3,386		1.11	%	1,190,733			3,223		1.10	%
Noninterest bearing liabilities
Demand deposits	120,464							115,198
Other liabilities	15,928							14,096
Total liabilities	1,358,718							1,320,027
Shareholders' equity - preferred	—							7,244
Shareholders' equity - common	146,396							126,800
Total liabilities and   shareholders' equity	$	1,505,114						$	1,454,071
NET INTEREST EARNINGS				$	12,185						$	11,894
NET INTEREST MARGIN						3.50	%						3.59	%

11

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures
	For the Quarter Ended
Dollars in thousands	3/31/2016			12/31/2015			3/31/2015
Core earnings applicable to common shares	$	3,950		$	4,084		$	4,326
FHLB special dividend	—			—			176
Applicable income tax effect	—			—			(65		)
Realized securities gains	393			421			480
Applicable income tax effect	(145		)	(156		)	(178		)
Merger expense	(112		)	—			—
Applicable income tax effect	41			—			—
Gain (loss) on sale of foreclosed properties	6			314			(150		)
Applicable income tax effect	(2		)	(116		)	56
Write-downs foreclosed properties	(109		)	(636		)	(572		)
Applicable income tax effect	40			235			212
	112			62			(41		)
GAAP net income applicable to common shares	$	4,062		$	4,146		$	4,285
Core diluted earnings per common share	$	0.37		$	0.38		$	0.40
FHLB special dividend	—			—			0.02
Applicable income tax effect	—			—			—
Realized securities gains	0.04			0.04			0.05
Applicable income tax effect	(0.01		)	(0.01		)	(0.02		)
Merger expense	(0.01		)	—			—
Applicable income tax effect	—			—			—
Gain (loss) on sale of foreclosed properties	—			0.03			(0.01		)
Applicable income tax effect	—			(0.01		)	—
Write-downs of foreclosed properties	(0.01		)	(0.06		)	(0.05		)
Applicable income tax effect	—			0.02			0.02
	0.01			0.01			0.01
GAAP diluted earnings per common share	$	0.38		$	0.39		$	0.41

12

SUMMIT FINANCIAL GROUP, INC. (NASDAQ: SMMF)
Reconciliation of Non-GAAP Financial Measures to GAAP Financial Measures
	For the Quarter Ended
Dollars in thousands	3/31/2016			12/31/2015			3/31/2015
Total core revenue	$	14,192		$	14,181		$	14,003
FHLB special dividend	—			—			176
Realized securities gains	393			421			480
GAAP total revenue	$	14,585		$	14,602		$	14,659
Total core noninterest income	$	2,413		$	2,448		$	2,659
Realized securities gains	393			421			480
GAAP total noninterest income	$	2,806		$	2,869		$	3,139
Total core noninterest expense	$	8,339		$	8,172		$	7,482
Merger expense	112			—			—
(Gains)/losses on sales of foreclosed properties	(6		)	(314		)	150
Write-downs of foreclosed properties	109			636			572
	215			322			722
GAAP total noninterest expense	$	8,554		$	8,494		$	8,204

13