FORM  10-Q

             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  March  31,  1999

                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  April  30,  1999,  3,047,747 shares of $1.00 par value common stock were
outstanding.

<PAGE>



<TABLE>
<CAPTION>

                  SUMMIT FINANCIAL CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             (Dollars in Thousands)
                                   (Unaudited)


                                                      March 31,    December 31,
                                                        1999           1998
                                                     -----------  --------------
<S>                                                  <C>          <C>
ASSETS
Cash and due from banks                              $    4,638   $       5,377 
Interest-bearing bank balances                              467             623 
Federal funds sold                                            -             400 
Investments available for sale                           26,279          27,102 
Loans, net of unearned income and net of
 allowance for loan losses of $1,944 and $1,827         129,893         128,842 
Premises and equipment, net                               3,041           3,101 
Accrued interest receivable                               1,026           1,132 
Other assets                                              3,905           3,908 
                                                     -----------  --------------
                                                     $  169,249   $     170,485 
                                                     ===========  ==============
  LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
 Noninterest-bearing demand                          $   19,707   $      20,877 
 Interest-bearing demand                                  8,562           8,541 
 Savings and money market                                54,324          50,047 
 Time deposits, $100,000 and over                        21,572          17,801 
 Other time deposits                                     38,638          42,977 
                                                     -----------  --------------
                                                        142,803         140,243 
Federal funds purchased and repurchase agreements           210           3,566 
Other short-term borrowings                                 500             820 
FHLB advances                                             7,700           8,000 
Accrued interest payable                                    927           1,052 
Other liabilities                                         1,001           1,130 
                                                     -----------  --------------
                                                        153,141         154,811 
                                                     -----------  --------------
Shareholders' equity:
 Common stock, $1.00 par value; 20,000,000
  shares authorized; issued and
  outstanding 3,047,747 and 3,038,706 shares              3,048           3,039 
 Additional paid-in capital                              12,749          12,726 
 Retained earnings                                          567               - 
 Accumulated other comprehensive income, net of tax         123             313 
 Nonvested resticted stock                                 (379)           (404)
                                                     -----------  --------------
     Total shareholders' equity                          16,108          15,674 
                                                     -----------  --------------
                                                     $  169,249   $     170,485 
                                                     ===========  ==============
<FN>

SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
</TABLE>

<PAGE>


<TABLE>
<CAPTION>

                  SUMMIT FINANCIAL CORPORATION AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME
                 (Dollars, except per share data, in Thousands)
                                   (Unaudited)

                                            For the Three Months Ended
                                                      March 31,
                                                      ---------
                                                    1999        1998
                                                    ----        ----
<S>                                            <C>          <C>
Interest Income:
 Loans                                         $    3,182   $    3,009 
 Taxable investment securities                        237          346 
 Nontaxable investment securities                     122           84 
 Federal funds sold                                     2           68 
 Other                                                 22           42 
                                               -----------  -----------
                                                    3,565        3,549 
                                               -----------  -----------
Interest Expense:
 Deposits                                           1,396        1,631 
 Other                                                124           55 
                                               -----------  -----------
                                                    1,520        1,686 
                                               -----------  -----------
     Net interest income                            2,045        1,863 
Provision for loan losses                             (81)         (50)
                                               -----------  -----------
     Net interest income after
      provision for loan losses                     1,964        1,813 
                                               -----------  -----------

Other Income:
 Service charges and fees on deposit accounts          48           41 
 Credit card service fees and income                   77           76 
 Insurance commission fee income                       60          101 
 Other income                                         209          164 
                                               -----------  -----------
                                                      394          382 
                                               -----------  -----------
Other Operating Expenses:
 Salaries, wages and benefits                         843          837 
 Occupancy                                            145          112 
 Furniture, fixtures and equipment                    154          144 
 Other operating expenses                             421          452 
                                               -----------  -----------
                                                    1,563        1,545 
                                               -----------  -----------
Income before income taxes                            795          650 
Provision for income taxes                           (228)        (235)
                                               -----------  -----------
Net income                                     $      567   $      415 
                                               ===========  ===========

Net income per share:
   Basic                                       $      .19   $      .15 
   Diluted                                     $      .16   $      .12 
Average shares outstanding:
   Basic                                        3,044,000    3,024,000 
   Diluted                                      3,591,000    3,554,000 

<FN>

SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
</TABLE>


<PAGE>



<TABLE>
<CAPTION>

                                        SUMMIT FINANCIAL CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY AND COMPREHENSIVE INCOME
                                      FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
                                                    (Dollars in Thousands)
                                                         (Unaudited)


                                                                                  Accumulated
                                                        Additional                   other        Nonvested        Total
                                               Common     paid-in    Retained    comprehensive   restricted    shareholders'
                                                stock     capital    earnings     income, net       stock         equity
                                               -------  -----------  ---------  ---------------  -----------  ---------------
<S>                                            <C>      <C>          <C>        <C>              <C>          <C>
Balance at December 31, 1997                   $ 2,875  $    10,909          -  $           90        ($505)  $       13,369 
Net income for the three months
 ended March 31, 1998                                -            -        415               -            -              415 
Other comprehensive income:
Unrealized holding gains on securities
  arising during the period, net of
  tax of $25                                         -            -          -              38            -               38 
                                                                                                              ---------------
Comprehensive income                                                                                                     453 
                                                                                                              ---------------
Employee stock options exercised                     1           28          -               -            -               29 
                                               -------  -----------  ---------  ---------------  -----------  ---------------
Balance at March 31, 1998                      $ 2,876  $    10,937  $     415  $          128        ($505)  $       13,851 
                                               =======  ===========  =========  ===============  ===========  ===============

Balance at December 31, 1998                   $ 3,039  $    12,726          -  $          313        ($404)  $       15,674 
Net income for the three months
 ended March 31, 1999                                -            -        567               -            -              567 
Other comprehensive income:
Unrealized gain on securities:
 Unrealized holding losses arising during
  the period, net of tax of ($116)                   -            -          -            (206)           -               - 
 Less: reclassification adjustment for gains
  included in net income, net of tax of $6           -            -          -              16            -               - 
                                                                                ---------------                              
 Other comprehensive loss                            -            -          -            (190)           -             (190)
                                                                                ---------------               ---------------
Comprehensive income                                                                                                     377 
                                                                                                              ---------------
Employee stock options exercised                     9           23          -               -            -               32 
Amortization of deferred
 compensation on restricted stock                    -            -          -               -           25               25 
                                               -------  -----------  ---------  ---------------  -----------  ---------------
Balance at March 31, 1999                      $ 3,048  $    12,749  $     567  $          123        ($379)  $       16,108 
                                               =======  ===========  =========  ===============  ===========  ===============

<FN>

SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
</TABLE>


<PAGE>



<TABLE>
<CAPTION>

                           SUMMIT FINANCIAL CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                              (Dollars in Thousands)
                                   (Unaudited)

                                                    For  the  Three  Months  Ended
                                                                    March 31,
                                                               ------------------
                                                                 1999      1998
                                                               --------  --------
<S>                                                            <C>       <C>
Cash flows from operating activities:
 Net income                                                    $   567   $   415 
Adjustments to reconcile net income to net cash
 provided by operating activities:
    Provision for loan losses                                       81        50 
    Depreciation and amortization                                  122       116 
    Gain on sale of equipment and vehicles                         (26)        - 
    Gain on sale investments available for sale                    (22)       (1)
    Net amortization (accretion) of net premium
     (discount) on investments                                      23       (17)
    Amortization of deferred compensation on restricted stock       25         - 
    Decrease in other assets                                       145       325 
    Decrease in other liabilities                                 (138)      (85)
                                                               --------  --------
Net cash provided by operating activities                          777       803 
                                                               --------  --------

Cash flows from investing activities:
  Purchases of securities available for sale                    (2,389)     (750)
  Proceeds from maturities of securities
   available for sale                                            1,884       252 
  Proceeds from sales of securities available for sale           1,021       951 
  Purchases of investments in FHLB and other stock                 (35)      (84)
  Net (increase) decrease in loans                              (1,132)    2,315 
  Purchases of premises and equipment                              (85)      (49)
  Proceeds from sale of equipment and vehicles                      49         - 
                                                               --------  --------
Net cash (used in) provided by investing activities               (687)    2,635 
                                                               --------  --------

Cash flows from financing activities:
  Net increase in deposit accounts                               2,560     1,351 
  Net decrease in federal funds purchased                       (3,357)        - 
  Repayment of other short-term borrowings                        (320)     (500)
  Proceeds from FHLB advances                                    9,550     2,500 
  Repayments of FHLB advances                                   (9,850)   (2,000)
  Proceeds from employee stock options exercised                    32        29 
                                                               --------  --------
Net cash (used in) provided by financing activities             (1,385)    1,380 
                                                               --------  --------
Net (decrease) increase in cash and cash equivalents            (1,295)    4,818 
Cash and cash equivalents, beginning of period                   6,400     9,361 
                                                               --------  --------
Cash and cash equivalents, end of period                       $ 5,105   $14,179 
                                                               ========  ========

SUPPLEMENTAL INFORMATION:
Cash paid during the period for interest                       $ 1,645   $ 1,908 
Cash paid during the period for income taxes                   $   250   $    36 
Change in market value of investment securities
 available for sale, net of income taxes                         ($190)  $    38 

<FN>

SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
</TABLE>


<PAGE>


                  SUMMIT FINANCIAL CORPORATION AND SUBSIDIARIES
           CONDENSED  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
                                 MARCH 31, 1999

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 demand and time
deposits,  commercial  and  consumer  loans,  and investment services.  The Bank
currently has three full service branch locations in Greenville, South Carolina.
In  1997,  the  Bank  incorporated  Summit  Investment  Services,  Inc.  as  a
wholly-owned subsidiary to provide an increased level of nondeposit products and
financial  management  services.  The  Finance  Company  commenced operations in
November  1994  and  makes  and services small, short-term installment loans and
related  credit  insurance  products  to  individuals  from  its  twelve offices
throughout  South  Carolina.

     The  accompanying consolidated financial statements include the accounts of
the  Company  and  its  subsidiaries.  All significant intercompany accounts and
transactions  have been eliminated in consolidation.  The unaudited consolidated
financial  statements of the Company at March 31, 1999 and for the periods ended
March  31,  1999  and 1998 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  March  31, 1999, and the results of operations and cash
flows  for  the  periods  ended March 31, 1999 and 1998 have been included.  The
results  for  the quarter ended March 31, 1999 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, 1998 included in the Company's
1998  Annual  Report  on  Form  10-K.

NOTE  2  -  CASH  FLOW  INFORMATION:
     For  the purposes of reporting cash flows, cash includes currency and coin,
cash  items  in  process of collection and due from banks.  Included in cash and
cash  equivalents are federal funds sold and overnight investments.  The Company
considers  the  amounts  included in the balance sheet line items, "Cash and due
from  banks",  "Interest-bearing  bank  balances" and "Federal funds sold" to be
cash  and  cash equivalents.  These accounts totaled $5,105 and $14,179 at March
31,  1999  and  1998,  respectively.

NOTE  3  -  PER  SHARE  INFORMATION:
     The  following  is  a  reconciliation  of the denominators of the basic and
diluted  per-share  computations for net income for the three months ended March
31,  1999  and  1998.  There is no required reconciliation of the numerator from
the  net  income reported on the accompanying statements of income.  All average
share  and  per share data have been restated to reflect all stock distributions
and  the  1998  two-for-one  stock  split  as  of the earliest period presented.
(Dollars,  except  per  share  data,  in  thousands).


<TABLE>
<CAPTION>

                                            Three Months Ended March 31,
                                      1999       1999         1998        1998
                                   ----------  ---------   ----------   ---------
                                     BASIC      DILUTED      BASIC      DILUTED
                                   ----------  ----------  ----------  ----------
<S>                                <C>         <C>         <C>         <C>
Net Income                         $      567  $      567  $      415  $      415
                                   ----------  ----------  ----------  ----------

Weighted average shares
 outstanding                        3,043,926   3,043,926   3,024,288   3,024,288
Effective of Dilutive Securities:
    Stock options                           -     547,391           -     529,234
                                   ----------  ----------  ----------  ----------
                                    3,043,926   3,591,317   3,024,288   3,553,522
                                   ----------  ----------  ----------  ----------

Per-share amount                   $     0.19  $     0.16  $     0.15  $     0.12
                                   ==========  ==========  ==========  ==========
</TABLE>



NOTE  4  -  SEGMENT  INFORMATION:
     The  Company reports information about its operating segments in accordance
with  SFAS  131,  "Disclosures  about  Segments  of  an  Enterprise  and Related
Information".  Summit  Financial  Corporation  is the parent holding company for
Summit National Bank ("Bank"), a nationally chartered bank, and Freedom Finance,
Inc.  ("Finance"),  a  consumer finance company.  The Company considers the Bank
and  the  Finance Company separate business segments.  Financial performance for
each  segment  is detailed in the following tables.  Included in the "Corporate"
column  are  amounts  for  general  corporate  activities  and  eliminations  of
intersegment  transactions.



<TABLE>
<CAPTION>

At  and  for  the  three  months  ended  March  31,  1999

                             Bank      Finance    Corporate     Total
                           ---------  ---------  -----------  ---------
<S>                        <C>        <C>        <C>          <C>
Interest income            $  3,140   $    447         ($22)  $  3,565 
Interest expense             (1,511)       (68)          59     (1,520)
                           ---------  ---------  -----------  ---------
Net interest income           1,629        379           37      2,045 
Provision for loan losses       (40)       (41)           -        (81)
Other income                    318         88          (12)       394 
Other expenses               (1,193)      (367)          (3)    (1,563)
                           ---------  ---------  -----------  ---------
Income before taxes             714         59           22        795 
Income taxes                   (199)       (23)          (6)      (228)
                           ---------  ---------  -----------  ---------
Net income                 $    515   $     36   $       16   $    567 
                           =========  =========  ===========  =========
Net loans                  $128,515   $  2,428      ($1,050)  $129,893 
                           =========  =========  ===========  =========
Total assets               $167,041   $  3,350      ($1,142)  $169,249 
                           =========  =========  ===========  =========
</TABLE>



<TABLE>
<CAPTION>

At  and  for  the  three  months  ended  March  31,  1998


                             Bank      Finance    Corporate     Total
                           ---------  ---------  -----------  ---------
<S>                        <C>        <C>        <C>          <C>
Interest income            $  3,142   $    428         ($21)  $  3,549 
Interest expense             (1,668)       (74)          56     (1,686)
                           ---------  ---------  -----------  ---------
Net interest income           1,474        354           35      1,863 
Provision for loan losses       (30)       (20)           -        (50)
Other income                    311         83          (12)       382 
Other expenses               (1,148)      (389)          (8)    (1,545)
                           ---------  ---------  -----------  ---------
Income before taxes             607         28           15        650 
Income taxes                   (221)        (9)          (5)      (235)
                           ---------  ---------  -----------  ---------
Net income                 $    386   $     19   $       10   $    415 
                           =========  =========  ===========  =========
Net loans                  $113,179   $  2,207        ($725)  $114,661 
                           =========  =========  ===========  =========
Total assets               $159,575   $  3,263        ($786)  $162,052 
                           =========  =========  ===========  =========
</TABLE>

<PAGE>

                         SUMMIT  FINANCIAL  CORPORATION

                        PART  I.  FINANCIAL  INFORMATION

                ITEM  2.  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS
              OF  FINANCIAL  CONDITION  AND  RESULTS  OF  OPERATIONS


          Summit  Financial Corporation (the Company) is a financial institution
holding  company headquartered in Greenville, South Carolina.  The Company has a
wholly-owned bank subsidiary, Summit National Bank (the Bank) and a wholly-owned
consumer  finance  company  subsidiary,  Freedom  Finance,  Inc.  (the  Finance
Company).  In  1997, the Bank incorporated Summit Investment Services, Inc. as a
wholly-owned subsidiary to provide an increased level of nondeposit products and
financial  management  services.

     During  the  quarter ended March 31, 1999, the Company's net income totaled
$567,000  or $.16 per diluted share.  This is compared to net income of $415,000
or  $.12  per diluted share for the same quarterly period of 1998 or an increase
of  33%.

     Total  assets  decreased $1.2 million or 1% from December 31, 1998 to March
31,  1999.  Gross  loans  increased  $1.2  million  (1%)  from  year end, funded
primarily  by  the $2.6 million increase in deposits.  The increase in deposits,
combined  with  the  reduction of liquid assets, was also utilized to reduce the
federal  funds  purchased  by  $3.3  million  and  other borrowings by $620,000.

RESULTS  OF OPERATIONS - COMPARISON OF THE THREE MONTHS ENDED MARCH 31, 1999 AND
1998

GENERAL
     The  Company  reported  consolidated net income for the quarter ended March
31,  1999  of $567,000, compared to net income of $415,000 for the quarter ended
March  31,  1998,  for  an  improvement  of  approximately $152,000 or 37%.  The
increase  in consolidated earnings for the 1999 period is primarily attributable
to  a  $167,000 or 10% decrease in the Company's interest expense resulting from
the  shift  of the deposit mix to a larger percentage of floating rate deposits,
which  allowed  the  Company  to  react  to  the  declining rate environment and
maintain  its net interest margin.  Another contributor to the higher net income
was  the Company's ability to limit the increase in overhead expenses to 1% from
the  prior  year,  despite  opening  a  new  branch  facility  in  October 1998.

NET  INTEREST  INCOME
     Net interest income is the difference between the interest earned on assets
and  the  interest paid for the liabilities used to support those assets.  It is
the  largest  component  of  the  Company's  earnings and changes in it have the
greatest  impact  on net income.  Variations in the volume and mix of assets and
liabilities  and their relative sensitivity to interest rate movements determine
changes  in  net  interest income.  During the quarter ended March 31, 1999, the
Company  recorded  consolidated  net  interest  income  of  $2.0  million, a 10%
increase  from  the  net  interest  income of $1.9 million for the quarter ended
March  31,  1998.  The  increase in this amount is related to the 3% increase in
the  average earning assets combined with the 10% reduction in interest expense.

     For  the quarters ended March 31, 1999 and 1998, the Company's consolidated
net  interest margin was 5.41% and 5.03%, respectively.  The net interest margin
is  calculated as annualized net interest income divided by year-to-date average
earning  assets.  The  increase  in  consolidated net interest margin is related
primarily to the lower average cost of liabilities as higher priced certificates
of  deposit  matured  and  were  replace with lower cost floating rate deposits.

INTEREST  INCOME
     For the quarter ended March 31, 1999, the Company's earning assets averaged
$157.9  million  and  had  an  average yield of 9.31%.  This compares to average
earning  assets of $153.6 million for the first quarter of 1998, yielding 9.49%.
Thus,  the 3% increase in volume of earning assets, offset by the 18 basis point
reduction  in  average  yield accounts for the $15,000 (1%) increase in interest
income  between  the  first  quarter  of  1998  and  1999.

     Consolidated  loans  averaged  approximately  82%  of the Company's average
earning  assets  for  the  first quarter of 1999.  The majority of the Company's
loans  are  tied to the prime rate (approximately 64% of the Bank's portfolio is
at  floating  rates  at  March  31, 1999, which averaged 7.75% and 8.50% for the
quarters  ended March 31, 1999 and 1998, respectively.  During the first quarter
of  1999,  the Bank's loans averaged $128.5 million, yielding an average rate of
8.70%,  compared  to  $116.1  million, yielding an average of rate 9.09% for the
first  quarter of 1998.  The 39 basis point decrease in the average yield on the
Bank's  loans  is  directly  related  to the reduction in the prime lending rate
which  occurred  during the fourth quarter of 1998.  The higher level of average
loans  (which increased 11%) offset the decrease in average rate and resulted in
an  increase  in  consolidated  interest  income  on  loans  of  $172,000 or 6%.

     Investment  securities  averaged  $26.5  million  or 17% of average earning
assets  and  yielded  6.44%  (tax  equivalent basis) during the first quarter of
1999,  compared  to  average  securities of $28.1 million yielding 6.83% for the
quarter  ended  March  31,  1998.  The  decrease  in  the  average  yield of the
investment  portfolio  is  related to the declining rate environment in 1998 and
the  timing,  maturity  distribution  and  maturities of investments higher than
current market yields.  The 6% decrease in average securities, combined with the
decrease  in  average  rate,  resulted  in  the  decrease  of interest income on
securities  of  $71,000.

INTEREST  EXPENSE
     The  Company's  interest  expense  for the quarter ended March 31, 1999 was
$1.5  million.  The  decrease of 10% from the comparable quarter in 1998 of $1.7
million  was  related  to  the  62  basis  point  reduction  in  average rate on
liabilities.  Interest-bearing liabilities averaged $131.6 million for the first
quarter  of  1999  with  an  average  rate  of  4.65%.  This compares to average
interest-bearing liabilities of $128.4 million with an average rate of 5.27% for
the  quarter  ended  March  31,  1998.  The decrease in the average rate was the
result  of maturities of certificates of deposit renewed at lower current market
rates  and  the  shift of deposits to a larger percentage of lower-cost floating
rate  deposits  which were repriced immediately as the prime rate dropped in the
fourth  quarter  of  1998.  At  March  31,  1999,  money market deposit accounts
totaled  38%  of  total  deposits  compared  to  29%  for  the  prior  year.

PROVISION  FOR  LOAN  LOSSES
     The  amount  charged  to  the provision for loan losses by the Bank and the
Finance  Company is based on management's judgment as to the amounts required to
maintain  an  allowance  adequate to provide for probable losses inherent in the
loan  portfolio.  The  level  of  this allowance is dependent upon growth in the
loan  portfolios; the total amount of past due loans; nonperforming loans; known
loan deteriorations and/or concentrations of credit; trends in portfolio volume,
maturity  and  composition;  projected  collateral  values;  general  economic
conditions;  and management's assessment of potential losses based upon internal
credit  grading of the loans and periodic reviews and assessments of credit risk
associated  with  particular  loans.

     While  it is the Company's policy to provide for loan losses in the current
period  in  which  a  loss is considered probable, there are additional risks of
future  losses  which cannot be quantified precisely or attributed to particular
loans  or  classes  of loans.  Management uses the best information available to
make  evaluations; however, future adjustments to the allowance may be necessary
if  economic conditions differ substantially from the assumptions used in making
evaluations.  The  Company  is  also  subject  to  regulatory  examinations  and
determinations  as to the adequacy of the allowance, which may take into account
such  factors as the methodology used to calculate the allowance for loan losses
and  the  size  of  the  allowance  in  comparison  to a group of peer companies
identified  by  the  regulatory  agencies.

     Included  in  the  net  income  for  the  quarter ended March 31, 1999 is a
provision  for loan losses of $81,000 compared to a provision of $50,000 for the
first  quarter  of 1998.  The higher net loan originations for the first quarter
of  1999, which totaled $15.4 million compared to $10.1 million for 1998, led to
the  increase  in  the  provision  for  loan  losses  in  the  current  year.

     At  March  31,  1999,  the  consolidated allowance for loan losses was $1.9
million  or  1.47%  of total gross loans.  This compares to an allowance of $1.7
million  or 1.50% of gross loans at March 31, 1998.  For the quarter ended March
31,  1999, the Company reported consolidated net recoveries of ($35,000) or .11%
of  average  loans on an annualized basis.  This is compared to consolidated net
charge-offs  of $37,000 or .12% (annualized) of average loans for the comparable
quarter  of  1998.  There were no loans on nonaccrual status at either March 31,
1999  or  1998.  Loans  past due 90 days and greater totaled $75,000 or 0.06% of
gross  loans  at  both March 31, 1999 and 1998.  Generally loans of the Bank are
placed  on nonaccrual status at the earlier of when they are 90 days past due or
when  the collection of interest becomes doubtful.  Loans of the Finance Company
are  not classified as nonaccrual, but are charged-off when they become 150 days
contractually  past  due  or  earlier  if the loan is deemed uncollectible.  The
allowance for loan losses at March 31, 1999 is considered adequate by management
to  cover  probable  losses  inherent  in  the  loan  portfolio  at  that  date.

OTHER  INCOME  AND  EXPENSES
     Other  income,  which is primarily related to service charges on customers'
deposit  accounts;  credit  card  interchange  fees;  merchant  discount  fees;
commissions  on nondeposit investment product sales and insurance product sales;
and mortgage origination fees, was $394,000 for the quarter ended March 31, 1999
compared  to  $382,000  for  the  first  quarter  of 1998, or an increase of 3%.
Reductions  in the volume of activity generating insurance commission income was
offset  by  increase  in other income related to gains on sales of available for
sale  investment  securities  and  company  vehicles.

     For  the  quarter ended March 31, 1999, total other operating expenses were
$1.6  million which is an increase of $17,000 or 1% over the amount incurred for
the  quarter  ended March 31, 1998.  The most significant item included in other
operating  expenses  is  salaries, wages and benefits which amounted to $843,000
for  the  quarter  ended  March 31, 1999 as compared to $837,000 for the quarter
ended  March  31,  1998.  The increase of $6,000 or 1% is a result of additional
staff  added at the new branch of the Bank in the fourth quarter of 1998, offset
by  (1)  lower  commission  expense  and associated payroll taxes related to the
reduction  in  nondeposit  product  sales  in the first quarter of 1998; and (2)
fewer  employees  at  the  Finance  Company related to a branch office which was
closed  in  September  1998.

     The  30%  ($33,000)  increase in occupancy and the 7% ($10,000) increase in
furniture, fixtures, and equipment ("FFE") between the first quarter of 1998 and
1999  is  directly  related  to  normal  expenses,  including  rent,  utilities,
depreciation,  and  property  taxes  and insurance, associated with the new Bank
branch  facility  which  opened  in  the  fourth  quarter  of  1998.

     Included  in  the  line  item  "other  operating expenses", which decreased
$32,000  or  7%  from  the  comparable  quarter  of  1998,  are  charges for OCC
assessments;  property and bond insurance; Relay/Cirrus switch fees; credit card
expenses;  professional services; education and seminars; advertising and public
relations;  and  other  branch  and  customer related expenses.  The decrease is
primarily  related  to  reductions  in  advertising,  education,  professional
services,  and  travel  which  were  incurred  in  1998  above the normal levels
experienced  in  the  1999  quarter.

INCOME  TAXES
     For  the  quarter  ended  March  31, 1999, the Company reported $228,000 in
income tax expense, or an effective tax rate of 29%.  This is compared to income
tax  expense of $235,000 for the same quarter of the prior year, or an effective
tax  rate  of  36%.  The reduction in the effective rate is primarily related to
the  higher  level  of  tax-free  municipal  investments.


LIQUIDITY
     Liquidity  management  involves  meeting  the cash flow requirements of the
Company.  The  Company  must maintain an adequate liquidity position in order to
respond  to  the  short-term  demand  for  funds  caused by the withdrawals from
deposit  accounts, maturities of repurchase agreements, extensions of credit and
for  the  payment  of  operating  expenses.  Maintaining  an  adequate  level of
liquidity  is  accomplished  through a combination of liquid assets, those which
can  easily  be  converted into cash, and access to additional sources of funds.
The  Company's  primary liquid assets are cash and due from banks, federal funds
sold,  unpledged  investment  securities  available  for  sale, other short-term
investments  and  maturing loans.  The Company's primary liquid assets accounted
for  11% and 16%, respectively of average assets at March 31, 1999 and 1998.  In
management's  opinion,  the  Company  maintains  adequate levels of liquidity by
retaining  liquid  assets and assets which can easily be converted into cash and
by maintaining access to various sources of funds.  The primary sources of funds
available  through  the  Bank  include  borrowing on a short-term basis from the
Federal Home Loan Bank and Federal Reserve System, purchasing federal funds from
other  financial  institutions,  and  increasing deposits by raising rates paid.

     Summit  Financial  Corporation  ("Summit  Financial"),  the  parent holding
company,  has  limited  liquidity needs.  Summit Financial requires liquidity to
pay  limited  operating expenses, to service its debt, and to provide funding to
its  consumer  finance  subsidiary,  Freedom Finance.  Summit Financial has $1.5
million  in  available  liquidity remaining from its initial public offering and
the  retention  of  earnings.  All of this liquidity was advanced to the Finance
Company  to  fund  its  operations  as  of  March 31, 1999.  In addition, Summit
Financial  has  an  available  line  of  credit  totaling  $2.5  million with an
unaffiliated  financial  institution,  all  of  which was available at March 31,
1999.  Additional  sources  of  liquidity for Summit Financial include unsecured
borrowings from individuals, and management fees and debt service which are paid
by  its  subsidiary  on  a  monthly  basis.

     Liquidity  needs  of  Freedom  Finance,  primarily  for the funding of loan
originations,  acquisitions,  and  operating  expenses,  have  been meet to date
through  the  initial  capital  investment of $500,000 made by Summit Financial,
borrowings  from  an  unrelated  private investor, and line of credit facilities
provided  by  Summit  Financial  and  Summit  National Bank, its sister company.

     The  Company's  management  believes  its liquidity sources are adequate to
meet  its  operating  needs  and  does  not  know  of  any  trends,  events  or
uncertainties  that  may result in a significant adverse affect on the Company's
liquidity  position.


CAPITAL  RESOURCES
     Total equity at March 31, 1998 was $16.1 million or 9.5% of total assets at
March  31,  1999.  This  is compared to $13.9 million or 8.5% of total assets at
March  31,  1998.  The  $2.2  million  increase  in  total  shareholders' equity
resulted  from  the  retention  of  earnings  and  stock  issued pursuant to the
Company's  incentive  stock  option  plan.

     To  date,  the  capital  needs  of  the  Company  have been met through the
retention  of net income and from the proceeds of its initial offering of common
stock.  The  Company  has  no commitments or immediate plans for any significant
capital  expenditures  outside  the  normal  course  of business.  The Company's
management  does not know of any trends, events or uncertainties that may result
in  the  Company's  capital  resources  materially  increasing  or  decreasing.

     The  Company  and  the  Bank  are  subject  to  various  regulatory capital
requirements  administered  by  the  federal  banking agencies.  Failure to meet
minimum  capital  requirements  can  initiate  certain  mandatory  and  possibly
additional discretionary actions by regulators that, if undertaken, could have a
material  effect on the financial statements.  Under capital adequacy guidelines
and  the  regulatory framework for prompt corrective action, the Company and the
Bank must meet specific capital guidelines that involve quantitative measures of
the  Company's  and the Bank's assets, liabilities and certain off-balance sheet
items  as  calculated  under regulatory accounting practices.  The Company's and
the  Bank's  capital  amounts and classification are also subject to qualitative
judgments  by  the  regulators  about  components,  risk  weightings,  and other
factors.

     The  Company  and  the  Bank  are  required to maintain minimum amounts and
ratios  of total risk-based capital, Tier 1 capital, and Tier 1 leverage capital
as set forth in the table following.  Management believes, as of March 31, 1999,
that  the  Company  and the Bank meet all capital adequacy requirements to which
they  are subject.  At March 31, 1999 and 1998, the Bank is categorized as "well
capitalized" under the regulatory framework for prompt corrective action.  There
are  no  current  conditions or events that management believes would change the
Company's  or  the  Bank's  category.

     The  following  table  presents the Company's and the Bank's actual capital
amounts  (dollars  in  thousands)  and  ratios  at March 31, 1999 as well as the
minimum  calculated  amounts  for  each  regulatory  defined  category.



<TABLE>
<CAPTION>

                              RISK-BASED CAPITAL CALCULATION

                                                           FOR CAPITAL    TO BE CATEGORIZED
                                            ACTUAL      ADEQUACY PURPOSES "WELL-CAPITALIZED"
                                        --------------- ----------------  --------------- 
                                        AMOUNT   RATIO   AMOUNT   RATIO   AMOUNT   RATIO
                                        -------  ------  -------  ------  -------  ------
<S>                                     <C>      <C>     <C>      <C>     <C>      <C>
AS OF MARCH 31, 1999
THE COMPANY
Total capital to risk-weighted assets   $18,718  13.45%  $11,134   8.00%       N.A.
Tier 1 capital to risk-weighted assets  $16,978  12.20%  $ 5,567   4.00%       N.A.
Tier 1 capital to average assets        $16,978  10.09%  $ 6,733   4.00%       N.A.

THE BANK
Total capital to risk-weighted assets   $15,926  11.64%  $10,943   8.00%  $13,679  10.00%
Tier 1 capital to risk-weighted assets  $14,218  10.39%  $ 5,472   4.00%  $ 8,207   6.00%
Tier 1 capital to average assets        $14,218   8.56%  $ 6,643   4.00%  $ 8,304   5.00%

AS OF MARCH 31, 1998
THE COMPANY
Total capital to risk-weighted assets   $15,756  12.89%  $ 9,781   8.00%       N.A.
Tier 1 capital to risk-weighted assets  $14,228  11.64%  $ 4,891   4.00%       N.A.
Tier 1 capital to average assets        $14,228   8.82%  $ 6,449   4.00%       N.A.

THE BANK
Total capital to risk-weighted assets   $13,674  11.43%  $ 9,572   8.00%  $11,964  10.00%
Tier 1 capital to risk-weighted assets  $12,178  10.18%  $ 4,786   4.00%  $ 7,179   6.00%
Tier 1 capital to average assets        $12,178   7.67%  $ 6,354   4.00%  $ 7,942   5.00%

</TABLE>


<PAGE>

EFFECT  OF  INFLATION  AND  CHANGING  PRICES
     The consolidated financial statements have been prepared in accordance with
generally  accepted  accounting  principles  which  require  the  measurement of
financial  position  and  results  of operations in terms of historical dollars,
without  consideration of changes in the relative purchasing power over time due
to  inflation.  Unlike  most  other  industries, virtually all of the assets and
liabilities  of  a  financial  institution are monetary in nature.  As a result,
interest  rates  generally  have  a  more  significant  effect  in  a  financial
institution's  performance  than  does  the  effect  of  inflation.

     The  yield  on  a  majority  of  the  Company's  earning  assets  adjusts
simultaneously  with  changes  in  the  general  level  of  interest  rates.
Approximately  50%  of  the  Company's interest-bearing liabilities at March 31,
1999  are  issued with fixed terms and can be repriced only at maturity.  During
periods  of  declining  interest  rates,  as  experienced in 1998, the Company's
assets  reprice  faster than the supporting liabilities.  This causes a decrease
in  the  net  interest  margin  until  the fixed rate liabilities mature and are
repriced  at  lower  current market rates, thus narrowing the difference between
what the Company earns on its assets and what it pays on its liabilities.  Given
the  Company's current balance sheet structure, the opposite effect (that is, an
increase  in net interest income) is realized in a rising rate environment.  The
degree  of interest rate sensitivity of the Company's assets and liabilities and
the  differences  in  timing  of  repricing  assets  and liabilities provides an
indication  of  the  extent  to  which  the Company's net interest income may be
affected  by  interest  rate  movements.


ACCOUNTING,  REPORTING  AND  REGULATORY  MATTERS
     In  June  1998,  the  Financial  Accounting Standards Board ("FASB") issued
Statement  of  Financial  Accounting  Standards  ("SFAS")  133,  "Accounting for
Derivative  Instruments  and Hedging Activities."  SFAS 133 changes the previous
accounting definition of a derivative and discusses the appropriateness of hedge
accounting  for  various  forms of hedging activities.  Under this standard, all
derivatives  are  measured  at  fair  value  and  recognized in the statement of
financial position as assets or liabilities.  This standard is effective for all
fiscal quarters of years beginning after June 15, 1999.  Because the Company has
no  derivative  activity  at  this  time,  management  does not expect that this
standard  will  have  a  significant  effect  on  the  Company.


YEAR  2000
     The  Company  recognizes  that  there  is  a  business risk in computerized
systems  as  the  calendar  rolls  into the next century.  The Federal Financial
Institutions  Examination  Council  ("FFIEC") issued an interagency statement on
May  5,  1997,  providing  an outline for institutions to effectively manage the
Year  2000  ("Y2K")  challenges.  The  Company  has  developed  an  ongoing plan
designed  to  ensure  that  its  operational  and  financial systems will not be
adversely  affected  by  Y2K  software failures due to processing errors arising
from  calculations  using  dates  after  December  31, 1999.  The Company has an
internal  task  force  assigned  to  this project and the Board of Directors and
management  of  the Company have established Year 2000 compliance as a strategic
initiative.

     The  Company has completed the assessment phase of the project in which all
critical  applications  are  identified  and  programming issues determined.  In
conjunction  with  this  phase,  the  Company  inventoried  all of its hardware,
software,  and  environmental or other non-computerized systems.  Each inventory
item  (equipment,  application, or service provider system) has been prioritized
and  evaluated  as  to its Y2K compliance.  Currently, all systems identified as
"mission critical" have been certified as Y2K compliant by the vendors providing
the  software applications or hardware.  The Company has substantially completed
its  testing  phase  for both the mission critical applications as well as other
inventoried  items.  The  Company  has  established  timelines  for  testing all
noncritical  software  and  ancillary  systems,  such  as  telephone systems and
security devices.  Finally, the Company is in the process of completing both its
remediation  and  business  resumption  contingency plans.  In these contingency
plans,  all  possible  scenarios  have  attempted to be addressed, including the
resources and procedures necessary to manually process transactions in the event
the core systems do not function on January 1, 2000.  While the Company believes
that  it  has available resources to assure Y2K compliance, it is to some extent
dependent on vendor cooperation.  Accordingly, management is in constant contact
with  its  various  vendors  and  is monitoring their Y2K efforts on an on-going
basis.

     In  addition to the internal processing risks associated with the Year 2000
issue,  the  Company has made every attempt to address external risks, primarily
credit  and  liquidity,  associated with our major customers and their Year 2000
remediation  efforts.  The way that these material customers approach and comply
with  Y2K  readiness  will have a potentially significant impact on the Company.
In  an  effort  to  identify  and manage the risks posed by those customers, the
Company  has  (1)  identified  material customers; (2) evaluated their Year 2000
preparedness through questionnaires and interviews; (3) assessed their Year 2000
risk  to  the  Company;  and  (4) implemented appropriate controls to manage and
mitigate  their Year 2000 related risk to the Company.  The controls implemented
may  include  ongoing monitoring of a customer's Y2K remediation efforts, review
and  adjustment  of  credit  maturities,  obtaining  additional  collateral,  or
including  specific  Year  2000  language  in  loan  agreements, as appropriate.
Management  is  also  addressing all new relationships for Y2K risk.  Currently,
there  are  no  significant customers which are rated as a "high" Year 2000 risk
and  which  the Company believes a risk of loss is present.  Other components of
the  Company's  Year  2000 Customer Awareness Program include questionnaires for
major  customers,  hosting  seminars  for  customers, distributing the Company's
"Year  2000 Position Statement" which contains the initiatives and status of the
Company's Y2K efforts, and informative mailers and brochures describing the Year
2000  challenges  in  general  as  well  as  specific information related to the
Company.

     At  this  time,  the  Company  believes the cost of making modifications to
correct  any  Y2K  issues  will be nominal.  Corrections and "fixes" to software
provided  by  third-party vendors is covered in the annual maintenance fees paid
by  the  Company  on  a  regular  basis.  In  addition,  equipment  and software
acquisition  expenses  are  not  expected  to  materially differ from historical
levels  as the Company routinely upgrades and purchases technologically advanced
software  and hardware on a continual basis and expects to specifically evaluate
and  test  such  purchases  for  Y2K  compliance.  There has been no significant
change  to  the Company's existing technology plans due to any Year 2000 issues.

     The Company's management believes it has adequately addressed the Year 2000
issue  and  has  adequate resources and personnel executing the Year 2000 Action
Plan  to  ensure compliance in accordance with the timeframes established in the
plan  and  as  mandated by the regulatory agencies which oversee the Company and
its subsidiaries.  The Company's bank subsidiary has already been subject to and
will  undergo  additional  examinations  of  its Year 2000 initiatives to ensure
compliance  with  all  regulatory requirements.  Management does not know of any
trends,  events,  or  uncertainities  related  to  the  Year 2000 issues that it
believes  may  result in a significant adverse effect on the Company's financial
position.


INTEREST  RATE  SENSITIVITY
     Achieving  consistent  growth in net interest income is the primary goal of
the Company's asset/liability function.  The Company's profitability is affected
by  fluctuations in interest rates.  The Company attempts to control the mix and
maturities  of  assets  and liabilities to maintain a reasonable balance between
exposure  to  interest  rate fluctuations and earnings and to achieve consistent
growth  in net interest income.  The Company seeks to accomplish this goal while
maintaining  adequate  liquidity and capital.  A sudden and substantial increase
in interest rates may adversely impact the Company's earnings to the extent that
the  interest  rates on interest-earning assets and interest-bearing liabilities
do  not  change at the same speed, to the same extent or on the same basis.  The
Company's  asset/liability  mix  is  sufficiently balanced so that the effect of
interest rates moving in either direction is not expected to be significant over
time.

     The  Company's  Asset/Liability Committee ("ALCO") uses a simulation model,
among other techniques, to assist in achieving consistent growth in net interest
income  while managing interest rate risk.  The model takes into account, over a
12 month period or longer if necessary, interest rate changes as well as changes
in  the  mix  and  volume  of  assets  and liabilities.  The model simulates the
Company's  balance  sheet  and  income  statement  under  several different rate
scenarios  and  rate  shocks.  The  model's  inputs  (such as interest rates and
levels  of  loans  and deposits) are updated as necessary throughout the year in
order  to  maintain  a current forecast as assumptions change.  According to the
model,  the  Company  is  presently  positioned so that net interest income will
increase  slightly  if  interest  rates  rise in the near term and will decrease
slightly  if  interest  rates  decline  in  the  near  term.

     The Company also uses interest rate sensitivity gap analysis to monitor the
relationship  between  the maturity and repricing of its interest-earning assets
and  interest-bearing  liabilities.  Interest rate sensitivity gap is defined as
the  difference  between  the  amount  of  interest-earning  assets  maturing or
repricing  within  a  specific  time  period  and the amount of interest-bearing
liabilities  maturing  or  repricing  within  the  same time period.  The static
interest  sensitivity  gap  position,  while  not a complete measure of interest
sensitivity, is also reviewed periodically to provide insights related to static
repricing  structure  of  assets  and  liabilities.  At  March  31,  1999,  on a
cumulative  basis  through  12  months,  rate-sensitive  liabilities  exceed
rate-sensitive  assets,  resulting  in  a  12  month  period liability sensitive
position  at  the  date  of $27.9 million.  When the effective change ratio (the
historical  relative  movement of each asset's and liability's rates in relation
to  a  100  basis point change in the prime rate) is applied to the interest gap
position, the Company is actually in an asset sensitive position over a 12 month
period  and  the  entire repricing lives of the assets and liabilities.  This is
primarily  due to the fact that 64% of the loan portfolio moves immediately on a
one-to-one  ratio with a change in the prime rate, while the deposit accounts do
not  increase  or  decrease  as  much  relative  to  a  prime  rate  movement.

     The  Company's  asset  sensitive  position means that assets reprice faster
than  the  liabilities, resulting in increases in the net interest income during
periods  of  rising rates and decreases in net interest income when market rates
decline.  In  the  fourth  quarter  of  1998, interest rates dropped, leading to
declines  in  the  average  yield  on  assets  for  the first quarter of 1999 as
compared  to  1998.  However,  the Company was able to increase the net interest
margin  between  the  two  quarterly periods due to the reduction in the overall
cost  of  funds  based  primarily  on (1) the higher percentage of floating rate
deposits in 1999 as compared to 1998 which allowed the Company to respond to the
prime  rate  drops;  and  (2)  the  maturities  of higher priced certificates of
deposit  throughout  1998  which  were  replaced with CDs at lower current rates
during  the  year.


       ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Market  risk  is the risk of loss from adverse changes in market prices and
rates.  The  Company's  market  risk  arises principally from interest rate risk
inherent  in its lending, deposit and borrowing activities.  Management actively
monitors  and  manages  its  interest  rate risk exposure.  Although the Company
manages  other  risks,  as  in  credit quality and liquidity risk, in the normal
course  of  business,  management  considers  interest  rate risk to be its most
significant  market  risk  and  it  could  potentially have the largest material
effect  on  the  Company's financial condition and results of operations.  Other
types of market risks, such as foreign currency exchange rate risk and commodity
price  risk,  do  not  arise  in  the  normal  course  of the Company's business
activities.

     The  Bank's  ALCO  monitors  and considers methods of managing the rate and
sensitivity repricing characteristics of the balance sheet components consistent
with maintaining acceptable levels of changes in net portfolio value ("NPV") and
net  interest  income.  Net  portfolio  value  represents  the  market  value of
portfolio  equity  and  is  equal to the market value of assets minus the market
value  of  liabilities, with adjustments made for off-balance sheet items over a
range  of  assumed  changes  in market interest rates.  A primary purpose of the
Company's  asset  and  liability  management  is to manage interest rate risk to
effectively  invest  the  Company's capital and to preserve the value created by
its  core business operations.  As such, certain management monitoring processes
are  designed to minimize the impact of sudden and sustained changes in interest
rates  on  NPV  and  net  interest  income.

     The  Company's  exposure  to  interest  rate risk is reviewed on a periodic
basis  by  the  Board  of  Directors  and  the  ALCO  which  is charged with the
responsibility  to maintain the level of sensitivity of the Bank's net portfolio
value  within  Board  approved  limits.  Interest rate risk exposure is measured
using  interest  rate sensitivity analysis by computing estimated changes in NPV
of  its  cash flows from assets, liabilities, and off-balance sheet items in the
event  of  a  range  of assumed changes in market interest rates.  This analysis
assesses the risk of loss in market risk sensitive instruments in the event of a
sudden  and  sustained 100 - 400 basis points increase or decrease in the market
interest  rates.  The  Company's Board of Directors has adopted an interest rate
risk policy which establishes maximum allowable decreases in NPV in the event of
a  sudden  and  sustained  increase  or  decrease  in  market  interest  rates.

     As  of  March  31,  1999, there was no substantial change from the interest
rate  sensitivity  analysis  or the market value of portfolio equity for various
changes  in  interest  rates  calculated  as of December 31, 1998. The foregoing
disclosures  related  to  the  market  risk  of  the  Company  should be read in
conjunction  with  the  Company's  audited  consolidated  financial  statements,
related  notes  and  management's discussion and analysis of financial condition
and  results  of operations for the year ended December 31, 1998 included in the
Company's  1998  Annual  Report  on  Form  10-K.

<PAGE>



                          SUMMIT FINANCIAL CORPORATION

                          PART  II.  OTHER  INFORMATION



Item  1.     Legal  Proceedings.

The  Corporation  and  its  subsidiaries  from  time  to  time and currently are
involved  as  plaintiff  or  defendant  in various legal actions incident to its
business.  There  are  no  material  actions  currently  pending.

Item  2.     Changes  in  Securities.

     None.

Item  3.     Defaults  Upon  Senior  Securities.

     None.

Item  4.     Submission  of  Matters  to  a  Vote  of  Security  Holders.

          At  the Annual Meeting of Shareholders held April 20, 1999 pursuant to
the Notice of Annual Meeting of Shareholders and Proxy Statement dated March 19,
1999,  the  following  matters  were  voted  on:

          (1)  election  of  4  nominees  for  directors  to  terms  of 3 years:
2,698,478  shares  (99.9%  of  the  votes  cast)  voted  FOR the election of the
directors;  and
          (2)  the  ratification  of the appointment of KPMG Peat Marwick LLP as
independent  accountants for the Company:  2,692,892 shares (99.7% of the shares
represented  at  the  meeting) voted FOR the ratification; 1,675 shares AGAINST;
7,540  shares  ABSTAIN.

          No other matters were submitted to the shareholders for  a vote at the
Annual  Meeting  or  at  any  other  time  during  the  quarter.

Item  5.     Other  Information.

     None.

Item  6.     Exhibits  and  Reports  on  Form  8-K.

(a)     Exhibits:

     27.1  Financial  Data  Schedule

(b)     Reports  on  Form  8-K:

     None.

<PAGE>

                       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:  May  6,  1999          /s/  J.  Randolph  Potter
                               -------------------------
                               J.  Randolph  Potter,  President
                              and  Chief  Executive  Officer


Dated:  May  6,  1999          /s/  Blaise  B.  Bettendorf
                               ---------------------------
                               Blaise  B.  Bettendorf,  Senior
                               Vice  President  and  Chief
                               Financial  Officer