Summit Financial Group, Inc. has released reported financial results for the second quarter of 2023, showcasing strong core operating performance marked by notable strength in its net interest margin. The company’s continued success underscores its position as a reliable partner in the financial services industry, reflecting a sound strategy and solid operational execution.
The company, which serves commercial and individual clients across West Virginia, the Washington, DC metropolitan area, Virginia, Kentucky, the Eastern Shore of Maryland and Delaware through Summit Community Bank, Inc., reported net income applicable to common shares of $7.98 million, or $0.54 per diluted share, for the second quarter of 2023, as compared to $13.9 million, or $1.08 per diluted share, for the first quarter of 2023 and $11.8 million, or $0.92 per diluted share, for the second quarter of 2022. Lower earnings in Q2 2023 were driven primarily by significant acquisition-related expenses attributable to the acquisition of PSB Holding Corp. and its bank subsidiary, Provident State Bank, Inc. and by higher provision for credit losses recorded on purchased non-credit deteriorated loans from PSB and on a nonperforming commercial real estate participation loan.
“We are pleased to report strong core performance in second quarter of 2023, characterized by significant revenue growth, an improved net interest margin and strategic balance sheet expansion,” noted H. Charles Maddy III, president and chief executive officer of Summit Financial Group. “The completion of our acquisition of PSB Holding Corp. and Provident State Bank, Inc. is an important milestone for Summit, as it expanded our footprint to the Eastern Shore of Maryland and Delaware, providing exciting growth opportunities in new markets,” continued Maddy.
“Our net interest margin (NIM) increased by 6 basis points from the linked quarter, driven by higher yields on interest-earning assets and effective management of funding costs,” said Maddy. Furthermore, our loan portfolio showed positive momentum, with total core loan portfolio, excluding acquired loans, increasing six percent on an annualized basis during the quarter, and over nine percent since June 30, 2022.
“Despite the recent acquisition, our efficiency ratio remains below 48 percent, near its all-time record low, affirming our long tradition of optimizing operational performance,” continued Maddy. “As we move forward, Summit remains steadfast in our growth strategy and optimistic about our future. Our solid financial foundation, coupled with a talented team, positions us well to create long-term value for our shareholders through organic growth and strategic initiatives.”