SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C.  20549



                                    Form 8-K



                Current Report Pursuant to Section 13 or 15(d) of
                           The Securities Act of 1934




Date of Report (Date of earliest event reported)................January 15, 1997




                        SOUTH BRANCH VALLEY BANCORP, INC.
             (Exact name of registrant as specified in its charter)




West Virginia                          0-16587                     55-0672148
- ---------------------             --------------           -------------------- 
(State of other                      (Commission               (I.R.S. Employer
jurisdiction                        File Number)             Identification No.)
of incorporation)






                              310 North Main Street
                        Moorefield, West Virginia   26836
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          (Address of principal executive offices, including zip code)





Registrant's telephone number, including area code           (304) 538-2353
                                                   ------------------------









Item 5.     Other Events


      On January 15, 1997,  South Branch Valley Bancorp,  Inc.  ("South Branch")
executed  a binding  Letter of Intent  (the  "Letter  of  Intent")  with Fred L.
Haddad,  350 MacCorkle Avenue,  S.E., Station Place,  Charleston,  West Virginia
25314 to purchase all 275,000 shares of Mr.  Haddad's  stock,  or  approximately
23%,  in Capital  State Bank,  Inc.  ("Capital  State  Bank"),  a state  banking
corporation  located  at 2402  Mountaineer  Boulevard,  South  Charleston,  West
Virginia  25309.  South Branch will pay to Mr. Haddad a purchase price of $11.00
per  share.  The  Letter of Intent is  contingent  on the  happening  of various
events,  including  but not  limited  to (i)  execution  of a  definitive  stock
purchase  agreement;  (ii) the ability of South Branch to purchase an additional
149,680  shares of Capital  State  Bank stock at a purchase  price of $11.00 per
share from the following  individuals:  Karen L. Haddad - 10,000  shares,  Larry
Haddad - 20,000  shares,  Susan Haddad - 60,000  shares,  Lauren Haddad - 15,000
shares,  Elizabeth Haddad - 15,000 shares and Paul White - 29,680 shares;  (iii)
the  ability  of South  Branch  to obtain  all  regulatory  approvals;  and (iv)
completion  of a due diligence  review of legal,  accounting  and  environmental
matters, that is satisfactory to South Branch.
























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 hereunto duly authorized.



                                               South Branch Valley Bancorp, Inc.


                January 21, 1997                      /s/ H. Charles Maddy, III
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