Summit's year-end earnings decrease

MOOREFIELD, W.Va. — Summit Financial Group turned in a respectable final three months of 2008, but it wasn’t enough to keep its year-end earnings from tumbling.

The holding company for Winchester-based Summit Community Bank reported fourth-quarter net income of $3.6 million, or 48 cents a share, compared with $3.9 million, or 52 cents a share, for the prior-year fourth quarter.

Quarterly earnings included a one-time charge of $1 million related to Summit’s investments — a $700,000 loss from the purchase of the common stock of its former acquisition target, Reston-based Greater Atlantic Bank, and $300,000 from its preferred stock in government-backed mortgage giants Fannie Mae and Freddie Mac.

For all of 2008, Summit posted earnings of $2.3 million, or 31 cents a share, down from $13.5 million, or $1.85 a share, in 2007. Year-end losses from its Fannie and Freddie investments totaled $7.1 million.

“Our core business remains healthy,” President and CEO H. Charles Maddy III says in a statement. “We continue to see modest loan demand from existing customers, but we’ve become increasingly selective toward new business.”

The bank has shifted its attention to what it calls its “problem assets.” Of the $23.8 million in construction and development loans it identified in the third quarter as nonperforming, Summit has since reduced that amount by 40 percent, Maddy says.

— Daily Staff Report