Summit Financial in Moorefield, W.Va., plans to raise roughly $12.8 million through a private placement and a subsequent rights offering.

The $1.4 billion-asset bank intends to use the proceeds to strengthen its capital reserves and pay off debt.

"Higher consolidated capital levels resulting from these transactions should give us flexibility and strength to restore a dividend to our common shareholders sooner and to evaluate opportunities for future growth earlier than previously planned," H. Charles Maddy, III, the bank's president and chief executive officer, said in a press release Monday.

The capital raise will take place in three separate transactions. Summit will first raise approximately $8 million through a private placement with Castle Creek Capital Partners. The transaction will involve 819,384 shares of common stock, and is expected to close in the fourth quarter.

Castle Creek will then purchase an additional 237,753 shares of common stock for $2.3 million. The second transaction, scheduled to close in the first quarter, is conditioned on conversion of the bank's preferred shares into common stock.

Once the private placement is complete, Castle Creek will own 9.9% of the bank's common stock.

Finally, Summit plans to raise approximately $2.5 million through a rights offering to existing shareholders. The bank expects the offering to occur in the second quarter of next year.

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