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 September 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 October 20, 1997, 1,345,577 shares of $1.00 par value common stock were
outstanding.



<TABLE>
<CAPTION>

                           SUMMIT FINANCIAL CORPORATION
                            CONSOLIDATED BALANCE SHEETS
                              (Dollars in Thousands)



                                                     September 30,   December 31,
                                                          1997           1996
                                                     --------------  -------------
(Unaudited)
<S>                                                  <C>             <C>
ASSETS:
Cash and interest-bearing deposits. . . . . . . . .  $        7,423  $       6,026
Federal funds sold. . . . . . . . . . . . . . . . .          13,530          3,000
Investment securities available for sale
 (amortized cost of $23,538 and $18,510). . . . . .          23,619         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 $1,689 and $1,487 . . . . . . .         111,747        101,205
Premises and equipment, net . . . . . . . . . . . .           2,388          2,502
Accrued interest receivable . . . . . . . . . . . .           1,116            940
Other assets. . . . . . . . . . . . . . . . . . . .           1,466          1,344
                                                     --------------  -------------
     TOTAL ASSETS . . . . . . . . . . . . . . . . .  $      161,982  $     134,162
                                                     ==============  =============
LIABILITIES & SHAREHOLDERS' EQUITY:
Demand deposits . . . . . . . . . . . . . . . . . .  $       16,084  $      17,484
Interest-bearing demand deposits. . . . . . . . . .           6,481          6,227
Savings and money market deposits . . . . . . . . .          36,868         23,366
Time deposits, $100,000 and over. . . . . . . . . .          30,446         25,393
Other time deposits . . . . . . . . . . . . . . . .          52,725         45,335
                                                     --------------  -------------
     TOTAL DEPOSITS . . . . . . . . . . . . . . . .         142,604        117,805
Securities sold under repurchase agreements . . . .             792            761
Other borrowings. . . . . . . . . . . . . . . . . .           4,000          2,550
Accrued interest payable. . . . . . . . . . . . . .             993            823
Other liabilities . . . . . . . . . . . . . . . . .             666            586
                                                     --------------  -------------
     TOTAL LIABILITIES. . . . . . . . . . . . . . .         149,055        122,525
                                                     --------------  -------------
SHAREHOLDERS' EQUITY:
Common stock ($1.00 par value; 20,000,000 shares
 authorized; issued and outstanding 1,345,557 and
 1,334,409 shares). . . . . . . . . . . . . . . . .           1,346          1,335
Additional paid-in capital. . . . . . . . . . . . .          10,308         10,254
Retained earnings . . . . . . . . . . . . . . . . .           1,220             48
Unrealized net loss on investments available
 for sale, net of income taxes. . . . . . . . . . .              53              -
                                                     --------------  -------------
     TOTAL SHAREHOLDERS' EQUITY . . . . . . . . . .          12,927         11,637
                                                     --------------  -------------
     TOTAL LIABILITIES AND EQUITY . . . . . . . . .  $      161,982  $     134,162
                                                     ==============  =============
<FN>

SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
</TABLE>



<TABLE>
<CAPTION>

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


                                                           For the Quarters Ended
                                                               September 30,
                                                          1997              1996
                                                     ---------------  ----------------
<S>                                                  <C>              <C>
INTEREST INCOME:
 Loans. . . . . . . . . . . . . . . . . . . . . . .  $        2,953   $         2,351 
 Taxable investment securities. . . . . . . . . . .             299               307 
 Nontaxable investment securities . . . . . . . . .              34                 8 
 Federal funds sold . . . . . . . . . . . . . . . .             149                44 
 Other. . . . . . . . . . . . . . . . . . . . . . .              39                32 
                                                     ---------------  ----------------
                                                              3,474             2,742 
                                                     ---------------  ----------------
INTEREST EXPENSE:
 Deposits . . . . . . . . . . . . . . . . . . . . .           1,660             1,196 
 Other. . . . . . . . . . . . . . . . . . . . . . .              71                55 
                                                     ---------------  ----------------
                                                              1,731             1,251 
                                                     ---------------  ----------------
Net interest income . . . . . . . . . . . . . . . .           1,743             1,491 
Provision for loan losses . . . . . . . . . . . . .             (45)             (128)
                                                     ---------------  ----------------
Net interest income after provision for loan losses           1,698             1,363 
                                                     ---------------  ----------------
OTHER INCOME:
 Service charges and fees . . . . . . . . . . . . .              47                43 
 Credit card service fees and income. . . . . . . .              59                51 
 Insurance commission fee income. . . . . . . . . .              53                46 
 Other income . . . . . . . . . . . . . . . . . . .             100               102 
                                                     ---------------  ----------------
                                                                259               242 
                                                     ---------------  ----------------
OTHER OPERATING EXPENSES:
 Salaries, wages and benefits . . . . . . . . . . .             669               560 
 Occupancy. . . . . . . . . . . . . . . . . . . . .             113                99 
 Furniture, fixtures and equipment. . . . . . . . .             112               106 
 Other operating expenses . . . . . . . . . . . . .             387               316 
                                                     ---------------  ----------------
                                                              1,281             1,081 
                                                     ---------------  ----------------
Net income before income taxes. . . . . . . . . . .             676               524 
Provision for income taxes. . . . . . . . . . . . .            (244)             (202)
                                                     ---------------  ----------------
NET INCOME. . . . . . . . . . . . . . . . . . . . .  $          432   $           322 
                                                     ===============  ================
PER SHARE DATA:
  Primary . . . . . . . . . . . . . . . . . . . . .  $         0.31   $          0.23 
  Fully diluted . . . . . . . . . . . . . . . . . .  $         0.29   $          0.23 
AVERAGE SHARES OUTSTANDING:
  Primary and Fully Diluted . . . . . . . . . . . .           1,487             1,411 
<FN>

SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
</TABLE>



<TABLE>
<CAPTION>

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


                                                       For the Nine Months Ended
                                                               September 30,
                                                          1997             1996
                                                     ---------------  --------------
<S>                                                  <C>              <C>
INTEREST INCOME:
 Loans. . . . . . . . . . . . . . . . . . . . . . .  $        8,497   $       6,398 
 Taxable investment securities. . . . . . . . . . .             853             952 
 Nontaxable investment securities . . . . . . . . .              62              22 
 Federal funds sold . . . . . . . . . . . . . . . .             273             159 
 Other. . . . . . . . . . . . . . . . . . . . . . .             118             110 
                                                     ---------------  --------------
                                                              9,803           7,641 
                                                     ---------------  --------------
INTEREST EXPENSE:
 Deposits . . . . . . . . . . . . . . . . . . . . .           4,446           3,486 
 Other. . . . . . . . . . . . . . . . . . . . . . .             198             157 
                                                     ---------------  --------------
                                                              4,644           3,643 
                                                     ---------------  --------------
Net interest income . . . . . . . . . . . . . . . .           5,159           3,998 
Provision for loan losses . . . . . . . . . . . . .            (256)           (313)
                                                     ---------------  --------------
Net interest income after provision for loan losses           4,903           3,685 
                                                     ---------------  --------------
OTHER INCOME:
 Service charges and fees . . . . . . . . . . . . .             148             127 
 Credit card service fees and income. . . . . . . .             180             163 
 Insurance commission fee income. . . . . . . . . .             149             144 
 Other income . . . . . . . . . . . . . . . . . . .             275             309 
                                                     ---------------  --------------
                                                                752             743 
                                                     ---------------  --------------
OTHER OPERATING EXPENSES:
 Salaries, wages and benefits . . . . . . . . . . .           2,010           1,710 
 Occupancy. . . . . . . . . . . . . . . . . . . . .             344             288 
 Furniture, fixtures and equipment. . . . . . . . .             325             302 
 Other operating expenses . . . . . . . . . . . . .           1,131             918 
                                                     ---------------  --------------
                                                              3,810           3,218 
                                                     ---------------  --------------
Net income before income taxes. . . . . . . . . . .           1,845           1,210 
Provision for income taxes. . . . . . . . . . . . .            (674)           (464)
                                                     ---------------  --------------
NET INCOME. . . . . . . . . . . . . . . . . . . . .  $        1,171   $         746 
                                                     ===============  ==============
PER SHARE DATA:
  Primary . . . . . . . . . . . . . . . . . . . . .  $         0.81   $        0.53 
  Fully diluted . . . . . . . . . . . . . . . . . .  $         0.79   $        0.53 
AVERAGE SHARES OUTSTANDING:
  Primary and Fully Diluted . . . . . . . . . . . .           1,486           1,410 
<FN>

SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
</TABLE>



<PAGE>
<TABLE>
<CAPTION>

                                           SUMMIT FINANCIAL CORPORATION
                                  CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                             FOR THE NINE MONTHS ENDED SEPTEMBER 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
                                        -------- -------- ------------ ----------- --------------    -------------  
  
<S>                                      <C>     <C>      <C>          <C>         <C>             <C>
Balance at December 31, 1995. . . . . .   1,267  $ 1,267  $     9,342          -   $          54   $       10,663 
Net income for the year ended                                              1,002                            1,002 
 December 31, 1996. . . . . . . . . . .       -        -            -                          - 
Change in unrealized net gain (loss) on                                                      (54)             (54)
 investment securities available for
 sale, net of income taxes. . . . . . .       -        -            -          - 
Employee stock options exercised. . . .       4        4           24          -               -               28 
Issuance of 5% stock distribution . . .      63       63          888       (951)              -                - 
Cash in lieu of fractional shares from                                        (2)                              (2)
 stock distribution . . . . . . . . . .       -        -            -                          - 
                                         ------  -------  -----------  ----------  --------------   --------------
Balance at December 31, 1996. . . . . .   1,334    1,334       10,254         49               -           11,637 
Net income for the nine months                                             1,171                            1,171 
ended September 30, 1997. . . . . . . .       -        -            -                          - 
Change in unrealized net gain (loss) on                                                       53               53 
 investment securities available for
 sale, net of income taxes. . . . . . .       -        -            -          - 
Employee stock options exercised. . . .      12       12           54          -               -               66 
                                         ------  -------  -----------  ---------   --------------  ---------------
Balance at September 30, 1997 . . . . .   1,346  $ 1,346  $    10,308  $   1,220   $          53   $       12,927 
                                         ======  =======  ===========  ==========  ==============  ===============

<FN>


SEE  NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
</TABLE>



<TABLE>
<CAPTION>

                                SUMMIT FINANCIAL CORPORATION
                           CONSOLIDATED STATEMENTS OF CASH FLOWS
                                        (Unaudited)


                                                               For the Nine Months Ended
                                                                     September 30,
                                                                 1997             1996
                                                            ---------------  --------------
<S>                                                         <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income. . . . . . . . . . . . . . . . . . . . . . . .  $        1,171   $         746 
 Adjustments to reconcile net income to net cash
  provided by operating activities:
   Provision for loan losses . . . . . . . . . . . . . . .             256             313 
   Depreciation and amortization . . . . . . . . . . . . .             250             232 
   Gain on sale of fixed assets. . . . . . . . . . . . . .             (29)              - 
   Gain on sale of investments available for sale. . . . .              (1)              - 
   Net amortization of net premium on investments. . . . .               5               7 
   Increase in other assets. . . . . . . . . . . . . . . .            (298)           (468)
   Increase (decrease) in other liabilities. . . . . . . .             224            (424)
                                                            ---------------  --------------
Net cash provided by operating activities. . . . . . . . .           1,578             406 
                                                            ---------------  --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchases of securities available for sale. . . . . . . .         (10,832)         (7,822)
 Proceeds from maturities of securities available for sale           2,809           7,990 
 Proceeds from sales of securities available for sale. . .           2,991               - 
 Purchases of Federal Home Loan Bank Stock . . . . . . . .             (59)           (122)
 Net increase in loans . . . . . . . . . . . . . . . . . .         (10,299)        (17,371)
 Purchases of net finance loans receivable . . . . . . . .            (499)         (1,099)
 Purchases of fixed assets . . . . . . . . . . . . . . . .            (147)            (65)
 Proceeds from sale of fixed assets. . . . . . . . . . . .              41               - 
                                                            ---------------  --------------
Net cash used in investing activities. . . . . . . . . . .         (15,995)        (18,489)
                                                            ---------------  --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
 Net increase in deposit accounts. . . . . . . . . . . . .          24,798          12,260 
 Net increase in securities sold under . . . . . . . . . .              30             183 
repurchase agreements
 Repayment of other borrowings . . . . . . . . . . . . . .             (50)         (2,000)
 Advances from other borrowings. . . . . . . . . . . . . .           1,500           1,700 
 Proceeds from stock issuance pursuant to. . . . . . . . .              66              28 
employee stock option plan                                  ---------------  -------------- 
Net cash provided by financing activities. . . . . . . . .          26,344          12,171 
                                                            ---------------  --------------
Net (decrease) increase in cash and cash equivalents . . .          11,927          (5,912)
Cash and cash equivalents, beginning of period . . . . . .           9,026          15,445 
                                                            ---------------  --------------
Cash and cash equivalents, end of period . . . . . . . . .  $       20,953   $       9,533 
                                                            ===============  ==============
SUPPLEMENTAL INFORMATION:
 Cash paid during period for interest. . . . . . . . . . .  $        4,474   $       3,725 
 Cash paid during period for income taxes. . . . . . . . .  $          775   $         613 
 Change in market value of investment securities available  $           53   $        (209)
  for sale, net of income taxes
<FN>
                                                                           
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
</TABLE>
                                                                             


                       SUMMIT  FINANCIAL  CORPORATION
             CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                              SEPTEMBER 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
September  30, 1997 and for the periods ended September 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
September  30,  1997,  and  the  results  of operations and cash flows for the
periods ended September 30, 1997 and 1996 have been included.  The results for
the  quarter or nine month period ended September 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  $20,953,000  and  $9,533,000 at
September  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.

<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).

     During  the  quarter  ended  September 30, 1996, the Company's net income
totaled  $432,000  or  $.29  per fully diluted share.  This is compared to net
income  of  $322,000  or  $.23  per fully diluted share for the same quarterly
period  of  1996 or an increase of 35%.  For the first nine months of 1997 the
Company  reported  net income of $1.2 million or $.79 per fully diluted share,
an  improvement  of  approximately $425,000 compared to the net income for the
first  nine  months  of  1996  of  $746,000  or  $.53 per fully diluted share.

     Total  assets  increased approximately $27.8 million or 21% from December
31,  1996  to  September  30,  1997.    Deposits increased approximately $24.8
million or 21% during the period.  The increase in deposits, combined with the
$1.4  million  (57%) increase in other borrowings, funded gross loan growth of
$10.7  million (10%), the $5.1 million (28%) increase in investments available
for  sale,  and the $10.5 million (351%) increase in federal funds sold during
the  same  period.

RESULTS  OF  OPERATIONS  - COMPARISON OF THE QUARTERS ENDED SEPTEMBER 30, 1997
AND  1996

GENERAL
     The  Company  reported  consolidated  net  income  for  the quarter ended
September  30,  1997  of  $432,000, compared to net income of $322,000 for the
quarter  ended September 30, 1996, or an improvement of approximately $110,000
or  35%.    The  increase  in  consolidated  earnings  for  the 1997 period is
primarily  attributable to (1) a $253,000 or 17% increase in the Company's net
interest  income  related  to  the  higher  level of earning assets in 1997 as
compared  to  the  prior  year  combined with the increase in general level of
interest rates during the period and (2) a reduction in the provision for loan
losses  for the third quarter of 1997 as compared to the prior year due to the
lower  loan  originations  for the 1997 quarter.  The increase in net interest
income  was  somewhat  offset  by  increases in other operating expenses.  The
Company  on  a  stand-alone  basis recorded net income of $21,000 for both the
third  quarter  of 1997 and 1996 related primarily to the interest income from
an  intercompany  loan  to  its  consumer  finance  subsidiary.

     Summit  National  Bank  recorded net earnings of $435,000 for the quarter
ended  September  30,  1997 which was a 43% increase from the third quarter of
1996  earnings  of  $305,000.   The increase in net income for this subsidiary
resulted  primarily  from a $234,000 (20%) increase in the Bank's net interest
income  which  was  directly  related to a 28% higher level of earning assets,
offset  somewhat  by  the 22 basis point reduction in the net interest margin.

     The  Company's  consumer  finance  subsidiary,  Freedom  Finance,  Inc.,
recorded  net  losses  for  both  the  third  quarter  of  1997  and  1996  of
approximately  $(24,000)  and  $(4,000),  respectively.   The higher operating
expenses  related  to  the  increase in the number of offices and employees in
1997 as compared to the same period of 1996 was the primary contributor to the
increased  loss  in  1997.

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 September
30,  1997,  the  Company  recorded  consolidated  net  interest income of $1.7
million,  a  17% increase from the net interest income of $1.5 million for the
quarter  ended  September  30,  1996.  The increase in this amount is directly
related  to  the  increase  in  the average earning asset and interest-bearing
liability  volume of the Company of 27% and 30%, respectively, offset somewhat
by  the  decline  in  net  interest  margin  for  the  Company.

     For  the  quarters  ended  September  30,  1997  and  1996, the Company's
consolidated  net  interest margin was 4.69% and 5.05%, respectively.  The net
interest  margin  is  calculated  as annualized net interest income divided by
year-to-date  average  earning  assets.    The  decrease  in  consolidated net
interest  margin  is  related primarily to the increase in the average cost of
liabilities  as  the  Bank offered several promotional deposit rates, combined
with  the  shift  of  earning  assets to lower yielding federal funds sold and
short-term  interest-bearing  deposits  as the loan growth slowed in the third
quarter  of  1997.

INTEREST  INCOME
     For  the  quarter  ended September 30, 1997, the Company's earning assets
averaged  $149.0  million and had an average yield of 9.30%.  This compares to
average  earning  assets of $117.3 million for the third quarter of 1996, also
yielding  9.30%.   Thus, the contributor to the increase in interest income of
$732,000  or 27% between the quarters ended September 30, 1996 and 1997 is the
increase  in  volume  of  earning  assets  of  27%.

     Consolidated  loans  averaged  approximately 77% of the Company's average
earning  assets  for the third quarter of 1997.  The majority of the Company's
loans are tied to the prime rate (approximately 60% of the Bank's portfolio is
at  floating  rates),  which  averaged  8.50% and 8.25% for the quarters ended
September  30, 1997 and 1996, respectively.  During the third quarter of 1997,
the  Bank's  loans averaged $112.7 million, yielding an average rate of 9.10%,
compared  to  $88.9  million,  yielding an average of rate 8.96% for the third
quarter  of  1996.    The increase in the average yield on the Bank's loans is
primarily  related to the 25 basis point increase in the prime lending rate in
late  March  1997.    The higher level of average loans (which increased 25%),
combined  with  the  increase  in  average  rate,  resulted  in an increase in
consolidated  interest  income  on  loans  of  $602,000  or  26%.

     Investment  securities  averaged  $21.5 million or 14% of average earning
assets  and  yielded  6.47% (tax equivalent basis) during the third quarter of
1997,  compared  to average securities of $20.7 million yielding 6.14% for the
quarter  ended  September  30, 1996.  The increase in the average yield of the
investment portfolio is related to the timing, maturity distribution and types
of  securities  purchased during the latter half of 1996 and into 1997 as well
as  the  maturities  of  some investments at lower than current market yields.
The  4%  increase in average securities, combined with the increase in average
rate, and resulted in the increase of interest income on securities of $18,000
or  6%.

INTEREST  EXPENSE
     The  Company's  interest expense for the quarter ended September 30, 1997
was  $1.7 million.  The increase of 38% from the comparable quarter in 1996 of
$1.25  million  was  related  to  the  30%  increase  in  average  volume  of
interest-bearing liabilities, combined with the increase in average rate of 31
basis  points.    Interest-bearing liabilities averaged $128.5 million for the
third quarter of 1997 with an average rate of 5.35%.  This compares to average
interest-bearing  liabilities  of  $98.8 million with an average rate of 5.04%
for  the  quarter  ended September 30, 1996.  The increase in the average rate
was  the  result  of (1) the higher level of general interest rates in 1997 as
compared  to  1996  and (2) the increase in rates paid on money market deposit
accounts  and  certificates  of  deposit  in  1997  for promotions to increase
deposits.

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 potential losses 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 charge-off in the current period
loans  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 September 30, 1997 is a
provision  for  loan losses of $45,000 compared to a provision of $128,000 for
the  third  quarter  of  1996.   The Bank had no net loan growth for the third
quarter  of  1997  due  to  numerous  large  payoffs, while loan growth at the
Finance  Company  was  nominal  for  the same period, thus the decrease in the
provision  required  for  the  comparable  quarterly  periods.

     At  September  30,  1997,  the consolidated allowance for loan losses was
$1.7  million or 1.49% of total gross loans.  This compares to an allowance of
$1.5  million  or 1.45% of gross loans at September 30, 1996.  For the quarter
ended  September  30,  1997,  the Company reported net charge-offs of $53,000,
which  is a result of the Finance Company net charge-offs of $38,000 (4.65% of
average loans of the Finance Company) combined with the Bank's net charge-offs
for  the  third  quarter of 1997 of $15,000.  This is compared to consolidated
net  charge-offs of $40,000 for the comparable quarter of 1996.  There were no
loans  on nonaccrual status at September 30, 1997 and nonaccrual loans for the
prior  year  were $1,000.  Loans past due 90 days and greater totaled $151,000
or  0.13%  of  gross  loans at September 30, 1997 and $94,000 or .10% of gross
loans  at  September  30,  1996.    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  September  30,  1997 represents management's
estimate  of  potential  losses  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  $259,000 for the quarter ended
September  30,  1997 compared to $242,000 for the third quarter of 1996, or an
increase  of 7%.  Increases in Bank branch related income items were offset by
reductions  in  nondeposit sale commission income in the third quarter of 1997
as  compared  to  1996.

     For  the  quarter  ended September 30, 1997, total overhead expenses were
$1.28  million  which  is  an increase of 19% over the amount incurred for the
quarter  ended  September 30, 1996 of $1.1 million.  The most significant item
included  in  other expenses is salaries, wages and benefits which amounted to
$669,000  for the quarter ended September 30, 1997 as compared to $560,000 for
the  quarter  ended  September 30, 1996.  The increase of $109,000 or 19% is a
result of (1) normal annual raises; (2) the Finance Company's operations which
increased  $30,000  or 19% related to the additional offices and staff between
the  third  quarters  of 1996 and 1997; (3) additional staff added at the Bank
between  the fourth quarter of 1996 and September 30, 1997; and (4) additional
bonus  accruals  pursuant  to  the  Bank's  incentive  bonus  program.

     The  13%  ($14,000)  increase  in  occupancy expenses and the 6% ($6,000)
increase  in  furniture,  fixtures,  and  equipment  ("FFE") between the third
quarters  of  1996  and 1997 are primarily related to normal operations of the
Bank  and  the additional branches of the Finance Company in the third quarter
of  1997  as  compared  to  the  prior  year.

     Included  in  the  line  item "other operating expenses", which increased
$71,000  or  22%  from  the  comparable  quarter  of 1996, 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.  These items
are  related  directly  to  the  normal operations of the Bank and increase in
relation  to  the  increase in assets, the higher level of transaction volume,
and the larger number of customer accounts.  The Bank's activity increased 26%
and  accounted  for  $57,000 or 80% of the increase and, in addition to normal
volume-related  activity  had  increases  in  advertising  due  to several new
deposit promotions and expenses for the check card product introduced in 1997.

     Also  included in the line item "other operating expenses" is activity of
the  Finance  Company which includes charges for credit reports, license fees,
acquisition  premium  amortization, and office support.  These items increased
11%  between  the  third quarter of 1997 and 1996 in relation to the volume of
activity,  number  of  branches  and  number  of  customer  accounts


INCOME  TAXES
     For  the  quarter ended September 30, 1997, the Company reported $244,000
in  income  tax expense, or an effective tax rate of 36%.  This is compared to
income  tax  expense of $202,000 for the same quarter of the prior year, or an
effective tax rate of 38.6%.  The reduction in the effective rate is primarily
related  to the increase in tax-free municipal investments in 1997 as compared
to  the  prior  year.


RESULTS OF OPERATIONS - COMPARISON OF THE NINE MONTHS ENDED SEPTEMBER 30, 1997
AND  1996

GENERAL
     The  Company  reported  consolidated net income for the nine months ended
September 30, 1997 of $1.2 million, compared to net income of $746,000 for the
nine  months  ended  September  30,  1996,  or an improvement of approximately
$425,000 or 57%.  The increase in consolidated earnings for the 1997 period is
primarily  attributable to a $1.2 million or 29% increase in the Company's net
interest  income  related  to  the  higher  level of earning assets in 1997 as
compared  to  the  prior  year, combined with the increase in general level of
interest  rates  during  the  period.  The increase in net interest income was
somewhat  offset  by  increases in other operating expenses.  The Company on a
stand-alone  basis  recorded  net  income of $62,000 for the nine months ended
September  30,  1997  related  primarily  to  the  interest  income  from  an
intercompany  loan  to  its  consumer  finance  subsidiary.

     Summit  National Bank recorded net earnings of $1.14 million for the nine
months  ended September 30, 1997 which was an 64% increase from the first nine
months  of  1996  earnings  of  $698,000.  The increase in net income for this
subsidiary resulted primarily from a $869,000 (27%) increase in the Bank's net
interest  income  which  was directly related to a 23% higher level of average
earning  assets  and  a 16 basis point improvement in the net interest margin.
This  increase  was  offset  somewhat  by a reduction in other income due to a
lower volume of activity in the nondeposit financial services area of the Bank
during  the  first  nine  months  of  1997  as compared to the prior year, and
increases  in  other  operating  expenses.

     The  Company's  consumer  finance  subsidiary,  Freedom  Finance,  Inc.,
recorded  net  losses  for  both  the  first  nine  months of 1997 and 1996 of
approximately  $(35,000)  and  $(9,000),  respectively.    The higher level of
outstanding  loans  for  the  1997 period as compared to the 1996 period which
generated  a  $278,000  or  39%  increase  in  net  interest income was offset
primarily  by  increases  in  (1)  the provision for loan losses and (2) other
operating  expenses  resulting from the higher number of offices and employees
in  1997  as  compared  to  the  same  period  of  1996.

NET  INTEREST  INCOME
     Net  interest  income,  the  difference  between  the interest earned and
interest  paid, 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 nine months
ended  September  30,  1997,  the  Company  recorded consolidated net interest
income  of  $5.2  million, a 29% increase from the net interest income of $4.0
million  for  the  nine months ended September 30, 1996.  The increase in this
amount  is  directly  related to the increase in the average earning asset and
interest-bearing liability volume of the Company of 27% and 23%, respectively,
combined  with  the  11  basis point increase in the consolidated net interest
margin  for  the  period.

     For  the  nine  months  ended  September 30, 1997 and 1996, the Company's
consolidated  net  interest margin was 4.81% and 4.70%, 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 primarily related to the Bank's net interest margin which
increased 16 basis points as a result of the higher average yield on loans and
investments during the period related to the general rise in interest rates in
1997.


INTEREST  INCOME
     For  the  nine  months  ended  September  30, 1997, the Company's earning
assets  averaged  $144.2  million  and  had an average tax-equivalent yield of
9.12%.    This  compares  to  average earning assets of $113.6 million for the
first  nine  months  of  1996,  yielding  approximately  8.98%.    Thus,  the
significant  contributor to the increase in interest income of $2.2 million or
28%  between the nine months ended September 30, 1996 and 1997 is the increase
in  volume of earning assets of 27%, combined with the 14 basis point increase
in  average  yield.

     Consolidated  loans  averaged  approximately 76% of the Company's average
earning  assets.    The  majority of the Company's loans are tied to the prime
rate  (approximately  60% of the Bank's portfolio is at floating rates), which
averaged  8.43%  and  8.28%  for  the nine months ended September 30, 1997 and
1996,  respectively.    During the first nine months of 1997, the Bank's loans
averaged  $107.8  million,  yielding  an  average  of 9.12%, compared to $84.0
million,  yielding an average of 8.17% for the first nine months of 1996.  The
increase  in the average yield on the Bank's loans is primarily related the 14
basis  point  increase  in  the average prime lending between the two periods,
combined  with  higher  pricing  on  new  loan  originations.  The increase in
average  yield  of  the  Finance  Company  loans  contributed  to  the  higher
consolidated  average  yield  on loans which increased to 10.39% for the first
nine months of 1997 compared to 10.01% for the first nine months of 1996.  The
higher  level  of  average  loans, combined with the increase in average rate,
resulted  in  an  increase  in  consolidated  interest income on loans of $2.1
million  or  33%.

     Investment  securities  averaged  $19.8 million or 14% of average earning
assets  and  yielded 6.40% (tax equivalent basis) during the first nine months
of  1997,  compared  to average securities of $21.8 million yielding 6.02% for
the  nine  months ended September 30, 1996.  The increase in the average yield
of  the  investment  portfolio is related to the timing, maturity distribution
and types of securities purchased during the latter half of 1996 and into 1997
as  well  as  the  maturities of some investments at lower than current market
yields.  The 9% decrease in average securities (which was primarily related to
maturities  of  the  holding  company's  securities  being  reinvested  in
intercompany  borrowings) was offset somewhat by the increase in average rate,
and  resulted  in  the decrease of interest income on securities of $59,000 or
6%.

INTEREST  EXPENSE
     The  Company's  interest  expense for the nine months ended September 30,
1997 was $4.6 million.  The increase of 27% from the comparable nine months in
1996  of  $3.6  million  was  related to the 23% increase in average volume of
interest-bearing liabilities, combined with the increase in average rate of 18
basis  points.    Interest-bearing liabilities averaged $118.2 million for the
first  nine months of 1997 with an average rate of 5.25%.  This is compared to
average  interest-bearing liabilities of $95.9 million with an average rate of
5.07%  for  the  nine  months  ended  September 30, 1996.  The increase in the
average  rate was the result of (1) the higher level of general interest rates
in 1997 as compared to 1996 and (2) the increase in rates paid on money market
deposit  accounts  and  certificates  of  deposit  in  1997  for promotions to
increase  deposits.

PROVISION  FOR  LOAN  LOSSES
     As  previously discussed under the quarterly analysis, 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  potential  losses  in  the  loan  portfolio.

     Included  in  the net income for the nine months ended September 30, 1997
is a provision for loan losses of $256,000 compared to a provision of $313,000
for  the first nine months of 1996.  The decrease in the provision required is
related  to  the  lower net originations experienced by the Company during the
first  three  quarters  of  1997  as  compared  to  the  same  period of 1996.

     At  September  30,  1997,  the consolidated allowance for loan losses was
$1.7  million or 1.49% of total gross loans.  This compares to an allowance of
$1.5  million  or  1.45%  of  gross loans at September 30, 1996.  For the nine
months  ended  September  30,  1997,  the  Company reported net charge-offs of
$79,000,  which is a result of the Finance Company net charge-offs of $118,000
(4.95%  of  average loans of the Finance Company) combined with the Bank's net
recoveries  for  the first nine months of 1997 of ($39,000).  This is compared
to  consolidated  net charge-offs of $39,000 for the comparable nine months of
1996.

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 $752,000 for the nine months ended
September  30, 1997 compared to $743,000 for the first nine months of 1996, or
an  increase of 1%.  Increases in Bank branch related income items were offset
by  reductions  in  nondeposit  sale  commission  income during the first nine
months  of  1997  as  compared  to  1996.

     For  the  nine  months  ended September 30, 1997, total overhead expenses
were $3.8 million which is an increase of 18% over the amount incurred for the
nine  months  ended  September 30, 1996 of $3.2 million.  The most significant
item included in other expenses is salaries, wages and benefits which amounted
to  $2.0  million  for the nine months ended September 30, 1997 as compared to
$1.7  million  for  the nine months ended September 30, 1996.  The increase of
$300,000  or  17%  is  a  result  of (1) normal annual raises; (2)  additional
accruals  under  the  Bank's  incentive  bonus  program;  and  (3) the Finance
Company's operations which increased $189,000 or 43% related to the additional
offices  and  between  the  first  nine  months of 1996 and 1997.  The Finance
Company's  operations  accounted  for  63%  of  the  increase  in salaries and
benefits  for  the  first  nine  months of 1997 as compared to the prior year.

     The  19%  ($56,000)  increase  in occupancy expenses and the 8% ($23,000)
increase  in furniture, fixtures, and equipment ("FFE") between the first nine
months  of  1996 and 1997 are primarily related to an $8,000 vault door repair
at  the Bank during the first nine months of 1997, and the additional branches
of  the  Finance  Company  in the first nine months of 1997 as compared to the
prior  year.    The  Finance  Company's  activity  accounted  for 53% and 79%,
respectively,  of  the  above  increases  in  occupancy  and  FFE.

     Included  in  the  line  item "other operating expenses", which increased
$213,000  or  23% from the comparable nine months of 1996, 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.  These items
are  related  directly  to  the  normal operations of the Bank and increase in
relation  to  the  increase in assets, the higher level of transaction volume,
and the larger number of customer accounts.  The Bank's activity accounted for
$113,000  or  53%  of  the  increase and, in addition to normal volume-related
activity  had  increases in advertising due to several new deposit promotions;
expenses  for  the  check  card  product  introduced  in  1997;  and  higher
professional  and  outside  service  fees  related  to  additional  technology
consulting  engagements  during  1997.

     Also  included in the line item "other operating expenses" is activity of
the  Finance  Company which includes charges for credit reports, license fees,
acquisition premium amortization, and office support.  These items increase in
relation  to the volume of activity, number of branches and number of customer
accounts.  The Finance Company added 3 new branches between September 1996 and
1997.

INCOME  TAXES
     For  the  nine  months  ended  September  30,  1997, the Company reported
$674,000  in  income  tax expense, or an effective tax rate of 36.5%.  This is
compared  to  income  tax  expense of $464,000 for the same nine months of the
prior  year,  or an effective tax rate of 38%.  The reduction in the effective
rate is primarily related to the increase in tax-free municipal investments in
1997  as  compared  to  the  prior  year.


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  16%  and  25%  of  average  assets  at  September  30,  1997  and  1996,
respectively.   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.

     The Company's core deposits consist of consumer non-jumbo (i.e. less than
$100,000)  time  deposits,  and  consumer and commercial savings accounts, NOW
accounts,  money  market  accounts, and checking accounts.  Although such core
deposits are becoming increasingly more costly and interest sensitive for both
the  Company  and  the  industry  as  a  whole, such core deposits continue to
provide  the  Company  with a large and stable source of funds.  Core deposits
averaged  66%  and  65% of earning assets during the first nine months of 1997
and  1996,  respectively.    The  Company  closely  monitors  its  reliance on
certificates of deposits greater than $100,000, which are generally considered
less stable and more interest rate sensitive than core deposits.  Certificates
of  deposit  in excess of $100,000, which represented 21% of total deposits at
both  September  30,  1997  and  1996,  are held primarily by customers in the
Company's  service area who have dealt with the Company for an extended period
of  time.    The  Company  has  no  brokered  deposits.

     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 $1.3
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 September 30, 1997.  In addition, Summit
Financial  has available lines of credit totaling $3 million with unaffiliated
financial  institutions,  of  which  all  was available at September 30, 1997.
Further  sources of liquidity for Summit Financial include management fees and
debt service which are paid by its subsidiary on a monthly basis and unsecured
borrowings  from  unaffiliated  individuals.

     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
     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 believes that the rate of asset growth will not
negatively  impact  the  capital base.  Total equity at September 30, 1997 was
$12.9  million.    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.

     Quantitative  measures  established  by  regulation  to  ensure  capital
adequacy  require  the  Company  and  the Bank to maintain minimum amounts and
ratios  (set forth in the table below) of total and Tier 1 capital (as defined
in  the  regulation) to risk-weighted assets (as defined) and to total assets.
Management  believes,  as of September 30, 1997, that the Company and the Bank
meet  all  capital  adequacy  requirements  to  which  they  are  subject.  At
September  30, 1997 and 1996, the Company and the Bank are both categorized as
"well  capitalized"  under  the  regulatory  framework  for  prompt corrective
action.    To  be  categorized as "well capitalized", the Company and the Bank
must maintain minimum total risk-based, Tier 1 risk-based, and Tier 1 leverage
ratios  as  set  forth in the table below.  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 September 30, 1997 as well as the
minimum  calculated  amounts  for  each  regulatory  defined  category.


<TABLE>
<CAPTION>




                                           FOR CAPITAL ADEQUACY       TO BE CATEGORIZED
                                  ACTUAL         PURPOSES            "WELL CAPITALIZED"
                                  -------  ----------------------   ----------------------

                         ACTUAL    RATIO      AMOUNT       RATIO    AMOUNT       RATIO
                         -------  -------  ------------  ---------  -------  -------------
<S>                      <C>      <C>      <C>           <C>        <C>      <C>

Total Qualifying
 Capital to Risk-
Weighted Assets:
Company
                         $14,400   11.79%  $      9,771      8.00%  $12,214         10.00%
Bank
                         $12,845   10.75%  $      9,563      8.00%  $11,954         10.00%

Tier 1 Capital to Risk-
Weighted Assets:
Company
                         $12,873   10.54%  $      4,886      4.00%  $ 7,329          6.00%
Bank
                         $11,356    9.50%  $      4,781      4.00%  $ 7,172          6.00%

Tier 1 Capital to
 Average Assets
Company
                         $12,873    8.85%  $      5,818      4.00%  $ 7,273          5.00%
Bank
                         $11,356    7.95%  $      5,716      4.00%  $ 7,146          5.00%

</TABLE>




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.  Most of
the Company's liabilities are issued with fixed terms and can be repriced only
at  maturity.   During periods of rising interest rates, as experienced at the
end of the first quarter of 1997, the Company's assets reprice faster than the
supporting  liabilities.    This causes an increase in the net interest margin
until the fixed rate deposits mature and are repriced at higher 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, a decrease in net
interest  income)  is  realized  in a falling 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  December  1996,  the  Financial  Accounting  Standards Board ("FASB")
issued Statement of Financial Accounting Standards ("SFAS") No. 127, "Deferral
of  the Effective Date of Certain Provisions of SFAS No. 125", an amendment to
SFAS No. 125 whish was effective December 31, 1996.  This statement delays the
effective  date of certain provisions of SFAS No. 125 until December 31, 1997.
The  amended  provisions  included those related to the transfers of financial
assets  and  secured  borrowings.    The provisions in SFAS No. 125 related to
servicing  assets  and  liabilities  are  not  delayed by this amendment.  The
adoption  of  this  standard  did  not have a material effect on the Company's
financial  statements.

     In  February  1997,  the  FASB issued SFAS No. 128, "Earnings per Share",
which  is  effective for both interim and annual periods ending after December
15,  1997.   This statement supersedes Accounting Principles Board Opinion No.
15,  "Earnings  per  Share".    The  purpose  of this statement is to simplify
current  reporting  and  make  U.S.  reporting  comparable  to  international
standards.   The statement requires dual presentation of basic and diluted EPS
by  entities  with  complex  capital structures (as defined by the statement).
The  Company  anticipates  that  adoption  of  this  standard  will not have a
material  effect  on  EPS.

     Also,  in  February  1997,  the  FASB issued SFAS No. 129, "Disclosure of
Information  about  Capital  Structure",  which  is  effective  for  financial
statements for periods ending after December 31, 1997.  This statement applies
to  both  public and nonpublic entities.  The new statement requires no change
for  entities  subject  to the existing requirements.  The Company anticipates
that adoption of this standard will not have a material effect on the Company.

     In  June  1997,  the  FASB  issued SFAS No. 130, "Reporting Comprehensive
Income",  which  establishes  standards  for  reporting  and  display  of
comprehensive  income  and  its  components  in a full set of general purposes
financial  statements.    Under  this  statement,  enterprises are required to
classify  items  of  "other  comprehensive  income"  by  their  nature  in the
financial  statement  and  display  the  balance of other comprehensive income
separately  in  the  equity  section  of  a  statement  of financial position.
Statement 130 is effective for both interim and annual periods beginning after
December  15,  1997.    Comparative  financial statements provided for earlier
periods  are  required  to  be  reclassified  to reflect the provisions of the
statement.   The Company will adopt Statement 130 effective March 31, 1998 and
will  provide  the  required  disclosures  in  the  Company's  Form  10-Q.

     Also  in  June  1997,  the  FASB  issued SFAS No. 131, "Disclosures about
Segments  of  an  Enterprise  and  Related  Information".    This  statement
establishes standards for the way public enterprises are to report information
about  operating  segments  in  annual financial statements and requires those
enterprises to report selected information about operating segments in interim
financial  reports  issued  to  shareholders.   Statement 131 is effective for
financial  statements  for  periods beginning after December 15, 1997.  In the
initial  year  of application, comparative information for earlier years is to
be  restated,  unless  it is impractical to do so.  It is not anticipated that
the  adoption  of  this statement will materially effect the Company's current
method  of  financial  reporting.

<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.

No  matters  were  submitted to the shareholders for a vote at any 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:  November 10, 1997                     /s/  J.  Randolph  Potter
                                              -------------------------
                                              J. Randolph Potter, President
                                                 and Chief Executive Officer


Dated:  November 10,  1997                     /s/  Blaise  B.  Bettendorf
                                               ---------------------------
                                                Blaise B. Bettendorf, Senior
                                                 Vice President and Chief
                                                      Financial Officer