FORM 10-Q/A
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For The Quarterly Period Ended June 30, 1997
Commission File Number 000-19235
SUMMIT FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
SOUTH CAROLINA 57-0892056
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification No.)
organization)
Post Office Box 1087
937 North Pleasantburg Drive
Greenville, South Carolina 29602
(Address, including zip code, of principal executive offices)
(803) 242-2265
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. YES [X] NO [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
As of July 20, 1997, 1,342,413 shares of $1.00 par value common stock were
outstanding.
PART I - FINANCIAL INFORMATION:
ITEM 1: CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
SUMMIT FINANCIAL CORPORATION
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
December 31,
June 30, 1997 1996
--------------- -------------
(Unaudited)
ASSETS:
Cash and interest-bearing deposits $ 8,213 $ 6,026
Federal funds sold 2,339 3,000
Investment securities available for sale
(amortized cost of $20,656 and $18,510) 20,665 18,511
Investments in stock of Federal Reserve Bank,
Federal Home Loan Bank, and other, at cost 693 634
Loans, net of unearned income and net of allowance
for loan losses of $1,698 and $1,487 112,911 101,205
Premises and equipment, net 2,433 2,502
Accrued interest receivable 1,010 940
Other assets 1,428 1,344
--------------- -------------
TOTAL ASSETS $ 149,692 $ 134,162
=============== =============
LIABILITIES & SHAREHOLDERS' EQUITY:
Demand deposits $ 12,691 $ 17,484
Interest-bearing demand deposits 6,549 6,227
Savings and money market deposits 34,399 23,366
Time deposits, $100,000 and over 27,691 25,393
Other time deposits 49,889 45,335
--------------- -------------
TOTAL DEPOSITS 131,219 117,805
Securities sold under repurchase agreements 781 761
Other borrowings 3,500 2,550
Accrued interest payable 964 823
Other liabilities 813 586
--------------- -------------
TOTAL LIABILITIES 137,277 122,525
--------------- -------------
SHAREHOLDERS' EQUITY:
Common stock ($1.00 par value; 20,000,000 shares 1,342 1,335
authorized; issued and outstanding 1,342,413 and
1,334,409 shares)
Additional paid-in capital 10,293 10,254
Retained earnings 787 48
Unrealized net loss on investments available
for sale, net of income taxes (7) -
--------------- -------------
TOTAL SHAREHOLDERS' EQUITY 12,415 11,637
--------------- -------------
TOTAL LIABILITIES AND EQUITY $ 149,692 $ 134,162
=============== =============
<FN>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SUMMIT FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars, except per share data in Thousands)
For the Quarters Ended June 30,
1997 1996
------- -------
INTEREST INCOME:
Loans $2,871 $2,076
Taxable investment securities 287 338
Nontaxable investment securities 19 8
Federal funds sold 54 77
Other 38 37
------- -------
3,269 2,536
------- -------
INTEREST EXPENSE:
Deposits 1,446 1,174
Other 67 53
------- -------
1,513 1,227
------- -------
Net interest income 1,756 1,309
Provision for loan losses (124) (103)
------- -------
Net interest income after provision for loan losses 1,632 1,206
------- -------
OTHER INCOME:
Service charges and fees 52 42
Credit card service fees and income 62 55
Insurance commission fee income 46 52
Other income 94 109
------- -------
254 258
------- -------
OTHER OPERATING EXPENSES:
Salaries, wages and benefits 649 565
Occupancy 119 93
Furniture, fixtures and equipment 107 96
Other operating expenses 380 290
------- -------
1,255 1,044
------- -------
Net income before income taxes 631 420
Provision for income taxes (231) (160)
------- -------
NET INCOME $ 400 $ 260
======= =======
PER SHARE DATA:
Primary $ 0.29 $ 0.18
Fully diluted $ 0.29 $ 0.18
AVERAGE SHARES OUTSTANDING:
Primary 1,492 1,410
Fully Diluted 1,492 1,410
<FN>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SUMMIT FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars, except per share data in Thousands)
For the Six Months Ended June 30,
1997 1996
------- -------
INTEREST INCOME:
Loans $5,544 $4,047
Taxable investment securities 554 645
Nontaxable investment securities 28 14
Federal funds sold 125 116
Other 78 77
------- -------
6,329 4,899
------- -------
INTEREST EXPENSE:
Deposits 2,785 2,290
Other 128 100
------- -------
2,913 2,390
------- -------
Net interest income 3,416 2,509
Provision for loan losses (211) (186)
------- -------
Net interest income after provision for loan losses 3,205 2,323
------- -------
OTHER INCOME:
Service charges and fees 102 85
Credit card service fees and income 122 112
Insurance commission fee income 96 97
Other income 174 207
------- -------
494 501
------- -------
OTHER OPERATING EXPENSES:
Salaries, wages and benefits 1,341 1,149
Occupancy 231 189
Furniture, fixtures and equipment 214 197
Other operating expenses 744 602
------- -------
2,530 2,137
------- -------
Net income before income taxes 1,169 687
Provision for income taxes (430) (262)
------- -------
NET INCOME $ 739 $ 425
======= =======
PER SHARE DATA:
Primary $ 0.52 $ 0.30
Fully diluted $ 0.52 $ 0.30
AVERAGE SHARES OUTSTANDING:
Primary 1,491 1,410
Fully Diluted 1,491 1,410
<FN>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SUMMIT FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
FOR THE SIX MONTHS ENDED JUNE 30, 1997 (UNAUDITED)
AND FOR THE YEAR ENDED DECEMBER 31, 1996
Shares Amount Additional Retained Unrealized Total
paid-in earnings net shareholders'
capital gain (loss) equity
on
investment
securities
available
for
sale, net of
income
taxes
--------------
Balance at December 31, 1995 1,267 $ 1,267 $ 9,342 - $ 54 $ 10,663
Net income for the year ended December 31, 1996 - - - $ 1,002 - 1,002
Change in unrealized net gain (loss) on
investment securities available for
sale, net of income taxes - - - - (54) (54)
Employee stock options exercised 4 4 24 - - 28
Issuance of 5% stock distribution 64 64 888 (952) - -
Cash in lieu of fractional shares from
stock distribution - - - (2) - (2)
------ ------- ----------- ---------- -------------- ---------------
Balance at December 31, 1996 1,335 1,335 10,254 48 - 11,637
Net income for the six months ended June 30, 1997 - - - 739 - 739
Change in unrealized net gain (loss) on
investment securities available for
sale, net of income taxes - - - - (7) (7)
Employee stock options exercised 7 7 39 - - 46
------ ------- ----------- ---------- -------------- ---------------
Balance at June 30, 1997 1,342 $ 1,342 $ 10,293 $ 787 ($7) $ 12,415
====== ======= =========== ========== ============== ===============
<FN>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SUMMIT FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Six Months Ended June 30,
1997 1996
--------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 739 $ 425
Adjustments to reconcile net income to net cash
provided by operating activities:
Provision for loan losses 211 186
Depreciation and amortization 167 153
Gain on sale of fixed assets (20) -
Gain on sale of investments available for sale (1) -
Net (accretion) amortization of net (discount) premium on investments (12) 7
Increase in other assets (153) (142)
Increase (decrease) in other liabilities 371 (395)
Net cash provided by operating activities 1,302 234
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of securities available for sale (7,145) (7,316)
Proceeds from maturities of securities available for sale 2,002 5,338
Proceeds from sales of securities available for sale 2,991 -
Purchases of Federal Home Loan Bank Stock (58) (122)
Net increase in loans (11,418) (11,577)
Purchases of net finance loans receivable (499) (234)
Purchases of fixed assets (101) (15)
Proceeds from sale of fixed assets 22 -
Net cash used in investing activities (14,206) (13,926)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase in deposit accounts 13,414 10,624
Net increase in securities sold under repurchase agreements 20 161
Repayment of other borrowings (50) -
Advances from other borrowings 1,000 -
Proceeds from stock issuance pursuant to employee stock option plan 46 10
Net cash provided by financing activities 14,430 10,795
--------- ---------
Net (decrease) increase in cash and cash equivalents 1,526 (2,897)
Cash and cash equivalents, beginning of period 9,026 15,445
Cash and cash equivalents, end of period $ 10,552 $ 12,548
========= =========
SUPPLEMENTAL INFORMATION:
Cash paid during period for interest $ 2,772 $ 2,351
Cash paid during period for income taxes $ 485 $ 434
Change in market value of investment securities available $ (7) $ (256)
for sale, net of income taxes
<FN>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SUMMIT FINANCIAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1997
NOTE 1 - BASIS OF PRESENTATION:
Summit Financial Corporation (the Company), a South Carolina corporation,
is the parent holding company for Summit National Bank (the Bank), a
nationally chartered bank, and Freedom Finance, Inc. (the Finance Company), a
consumer finance company.
Through its bank subsidiary, which commenced operations in July 1990, the
Company provides a full range of banking services, including the taking of
demand and time deposits and the making of commercial and consumer loans. The
Bank currently has two full service branch locations in Greenville, South
Carolina. The Finance Company commenced operations in November 1994 and makes
and services small installment loans to individuals from its twelve offices
throughout South Carolina.
The unaudited consolidated financial statements of the Company at June
30, 1997 and for the periods ended June 30, 1997 and 1996 were prepared in
accordance with the instructions for Form 10-Q and, in the opinion of
management, all adjustments (consisting only of items of a normal recurring
nature) necessary for a fair presentation of the financial position at June
30, 1997, and the results of operations and cash flows for the periods ended
June 30, 1997 and 1996 have been included. The results for the quarter or six
month period ended June 30, 1997 are not necessarily indicative of the results
that may be expected for the full year or any other interim period.
These consolidated financial statements do not include all disclosures
required by generally accepted accounting principles and should be read in
conjunction with the Company's audited consolidated financial statements and
related notes for the year ended December 31, 1996 included in the Company's
1996 Annual Report on Form 10K.
NOTE 2 - CASH FLOW INFORMATION:
The Company considers those amounts included in the balance sheet
captions "Cash and interest-bearing deposits" and "Federal funds sold" to be
cash and cash equivalents, which totaled $10,552 and $12,548 at June 30, 1997
and 1996, respectively. Cash includes currency and coin, cash items in
process of collection and due from banks. Included in cash and cash
equivalents are overnight investments and short-term investments with original
maturities of less than six months.
SUMMIT FINANCIAL CORPORATION
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SUMMIT FINANCIAL CORPORATION
Dated: September 2, 1997 /s/ J. Randolph Potter
----------------------
J. Randolph Potter, President
and Chief Executive Officer
Dated: September 2, 1997 /s/ Blaise B. Bettendorf
------------------------
Blaise B. Bettendorf, Senior
Vice President and Chief
Financial Officer