EX-99.1 2 exhibit991earningsrele.htm EX-99.1 Document

Exhibit 99.1
NEWS
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CONTACT:  Brian J. Richardson
UNIVEST FINANCIAL CORPORATION
Chief Financial Officer
215-721-2446, richardsonb@univest.net      

FOR IMMEDIATE RELEASE

UNIVEST FINANCIAL CORPORATION
REPORTS YEAR AND FOURTH QUARTER RESULTS
(Loan Growth for 2019 of 9.5%)

SOUDERTON, Pa., January 22, 2020 - Univest Financial Corporation (“Univest” or the "Corporation") (NASDAQ: UVSP), parent company of Univest Bank and Trust Co. and its insurance, investments and equipment financing subsidiaries, today announced net income for the year ended December 31, 2019 of $65.7 million, or $2.24 diluted earnings per share, compared to net income of $50.5 million, or $1.72 diluted earnings per share, for the year ended December 31, 2018. Net income for the quarter ended December 31, 2019 was $15.5 million, or $0.53 diluted earnings per share, compared to net income of $18.4 million, or $0.63 diluted earnings per share, for the quarter ended December 31, 2018.

One-Time Items
The financial results for the year ended December 31, 2019 included a Federal Deposit Insurance Corporation (FDIC) small bank assessment credit of $1.1 million (after-tax benefit of $871 thousand) of which $988 thousand was recognized during the third quarter of 2019 and $114 thousand was recognized during the fourth quarter of 2019. The FDIC credit represented a favorable impact to earnings per share of $0.03 during the third quarter of 2019 and for the year ended December 31, 2019. In addition, the fourth quarter and year ended December 31, 2019 included an expense related to a legal settlement with a former Fox Chase Bank customer of $869 thousand (after-tax charge of $687 thousand), or $0.02 diluted earnings per share.

The financial results for the year ended December 31, 2018 included a net provision for loan and lease losses of $10.9 million (after-tax charge of $8.6 million), or $0.29 diluted earnings per share related to fraudulent activities by employees of a borrower. The second quarter of 2018 included a pre-tax charge to the provision for loan and lease losses of $12.7 million (after-tax charge of $10.1 million), or $0.34 diluted earnings per share, related to this relationship, and the quarter ended December 31, 2018 included a


recovery of $1.8 million (after-tax recovery of $1.5 million), which represented $0.05 diluted earnings per share.

The year ended December 31, 2018 included two additional items: a tax-free bank owned life insurance (BOLI) death benefit of $446 thousand during the second quarter of 2018, which represented $0.02 diluted earnings per share, and restructuring costs related to financial center closures of $451 thousand, net of tax, recognized in the first quarter of 2018, which represented $0.02 diluted earnings per share.

Loans
Gross loans and leases increased $380.3 million, or 9.5%, from December 31, 2018 and $134.9 million, or 12.7% (annualized), from September 30, 2019 primarily due to growth in commercial real estate and residential real estate loans.

Deposits
Total deposits increased $468.8 million, or 12.1%, from December 31, 2018 primarily due to an increase in public funds deposits of $201.9 million and increases in commercial and consumer deposits. Total deposits increased $16.8 million, or 1.5% (annualized), from September 30, 2019 primarily due to increases in commercial and consumer deposits partially offset by a seasonal decrease in public funds deposits of $166.3 million.

Net Interest Income and Margin
Net interest income of $169.2 million for the year ended December 31, 2019 increased $11.2 million, or 7.1%, from the prior year. The increase in net interest income for the year ended December 31, 2019 compared to the prior year was primarily due to a 9.8% increase in average loans during the last year. Net interest margin, on a tax-equivalent basis, was 3.59% for the year ended December 31, 2019 compared to 3.72% for the year ended December 31, 2018. The favorable impact of purchase accounting accretion was two basis points for each of the years ended December 31, 2019 and 2018. Excess liquidity reduced net interest margin by approximately eight basis points for the year ended December 31, 2019 compared to one basis point for the year ended December 31, 2018. This excess liquidity was primarily driven by strong deposit balance growth during 2019. Excluding purchase accounting accretion and the impact of excess liquidity, the net interest margin, on a tax-equivalent basis, was 3.65% for the year ended December 31, 2019 and 3.71% for the year ended December 31, 2018.

Net interest margin, on a tax-equivalent basis, was 3.44% for the fourth quarter of 2019, compared to 3.52% for the third quarter of 2019 and 3.72% for the fourth quarter of 2018. The favorable impact of purchase accounting accretion was three basis points for the quarter ended December 31, 2019 compared to no impact for the quarter ended September 30, 2019 and one basis point for the quarter


ended December 31, 2018. Excess liquidity reduced net interest margin by approximately 12 basis points for the quarter ended December 31, 2019, compared to 13 basis points for the quarter ended September 30, 2019, and four basis points for the quarter ended December 31, 2018. Excluding purchase accounting accretion and the impact of excess liquidity, the net interest margin, on a tax-equivalent basis, was 3.53% for the quarter ended December 31, 2019 compared to 3.65% for the quarter ended September 30, 2019 and 3.75% for the quarter ended December 31, 2018.

Noninterest Income
Noninterest income for the quarter ended December 31, 2019 was $16.2 million, an increase of $1.8 million, or 12.2%, from the fourth quarter of 2018. Noninterest income for the year ended December 31, 2019 was $65.4 million, an increase of $5.2 million, or 8.7%, from the comparable period in the prior year.

The net gain on mortgage banking activities increased $325 thousand, or 45.6%, for the quarter and $821 thousand, or 26.3%, for the year ended December 31, 2019, primarily due to an increase in mortgage volume partially offset by contraction in margins to remain price competitive. Investment advisory commission and fee income increased $212 thousand, or 5.5%, for the quarter and $842 thousand, or 5.6%, for the year ended December 31, 2019, primarily due to new client relationships and appreciation of assets under management. Insurance commission and fee income increased $194 thousand, or 5.7%, for the quarter and $913 thousand, or 5.8%, for the year ended December 31, 2019, primarily due to an increase in premiums for commercial lines and group life and health for the quarter and year ended December 31, 2019 as well as an increase in contingent commission income of $316 thousand for the year ended December 31, 2019. Service charges on deposit accounts increased $314 thousand, or 5.6%, for the year ended December 31, 2019, primarily due to increased fee income on commercial cash management accounts. BOLI income increased $311 thousand for the quarter ended December 31, 2019 primarily due to a decline in the value of the non-qualified annuity portfolio of $287 thousand in the fourth quarter of 2018.

Other income increased $853 thousand for the quarter and $2.4 million for the year ended December 31, 2019. Fees on risk participation agreements increased $407 thousand for the quarter and $1.1 million for the year ended December 31, 2019, driven by increased customer activity. Gain on sale of small business administration (SBA) loans increased $94 thousand for the quarter and $462 thousand for the year ended December 31, 2019 due to increased SBA loan sale activity. Net loss on valuations and sales of other real estate owned was $28 thousand for the year ended December 31, 2019 compared to $626 thousand for the year ended December 31, 2018.



Noninterest Expense
Noninterest expense for the quarter ended December 31, 2019 was $37.5 million, an increase of $4.1 million, or 12.2%, compared to the fourth quarter of 2018. Noninterest expense for the year ended December 31, 2019 was $146.1 million, an increase of $8.8 million, or 6.4%, from the prior year.

Salaries, benefits and commissions increased $2.4 million, or 12.2%, for the quarter and $7.8 million, or 9.7%, for the year ended December 31, 2019, primarily attributable to additional staff hired to support revenue generation across all business lines, expansion of our commercial lending groups and annual merit increases. During the first quarter of 2019, Univest hired a team of eight commercial lenders and support staff to focus on increasing Univest’s presence in Western Lancaster and York Counties. During the second quarter of 2019, a team of three commercial lenders was hired to help expand Univest’s presence in the New Jersey suburbs of Philadelphia. Data processing expense increased $333 thousand, or 14.2%, for the quarter and $1.4 million, or 15.9%, for the year ended December 31, 2019, primarily due to continued investments in customer relationship management software and internal infrastructure improvements as well as outsourced data processing solutions for the year ended December 31, 2019. Other expense included a charge of $869 thousand related to a legal settlement with a former Fox Chase Bank customer.

These increases were partially offset by a decrease in deposit insurance premiums of $1.1 million for the year ended December 31, 2019 due to the previously discussed FDIC small bank assessment credit. Intangible expenses decreased by $107 thousand, or 22.2%, for the quarter and $571 thousand, or 26.4%, for the year ended December 31, 2019 due to a run-off of intangible assets from prior acquisitions. In addition, restructuring costs related to financial center closures and staffing rationalization were $571 thousand during the first quarter of 2018. There were no restructuring costs incurred during 2019. Excluding the FDIC small bank assessment credit, the legal settlement charge and restructuring costs, noninterest expense for the year ended December 31, 2019 increased $9.6 million, or 7.1%.

Asset Quality and Provision for Loan and Lease Losses
Nonperforming assets were $39.3 million at December 31, 2019, compared to $40.4 million at September 30, 2019 and $28.1 million at December 31, 2018. The increase in nonperforming assets at December 31, 2019 compared to December 31, 2018 was primarily due to one commercial banking relationship, totaling $11.9 million as of December 31, 2019, which was placed on non-accrual status during 2019.

Net loan and lease charge-offs were $558 thousand during the fourth quarter of 2019 and $2.6 million for the year ended December 31, 2019. The provision for loan and lease losses was $2.2 million for the fourth quarter of 2019 and $8.5 million for the year ended December 31, 2019. Net loan and lease


recoveries were $1.9 million during the fourth quarter of 2018, which included the $1.8 million recovery related to the previously discussed commercial loan charge-off. The provision for loan and lease losses was $103 thousand for the fourth quarter of 2018. For the year ended December 31, 2018, net loan and lease charge-offs of $12.5 million and the provision for loan and lease losses of $20.3 million include the previously discussed $10.9 million commercial loan net charge-off.

The allowance for loan and lease losses as a percentage of loans and leases held for investment, excluding covered loans acquired in the Fox Chase and Valley Green Bank acquisitions, which were recorded at fair value as of the acquisition date, was 0.85% at December 31, 2019 and September 30, 2019 and 0.81% at December 31, 2018.

Tax Provision
The effective income tax rate was 17.9% for the quarter ended December 31, 2019, compared to an effective income tax rate of 17.6% for the quarter ended December 31, 2018. The effective income tax rate was 17.9% for the year ended December 31, 2019 compared to an effective income tax rate of 16.7% for the year ended December 31, 2018.

Dividend
On December 9, 2019, Univest declared a quarterly cash dividend of $0.20 per share, payable on January 2, 2020. This represented a 3.01% annualized yield based on the closing price of Univest’s stock on the date the dividend was paid.

Conference Call
Univest will host a conference call to discuss fourth quarter and year end 2019 results on Thursday, January 23, 2020 at 9:00 a.m. EST. Participants may preregister at http://dpregister.com/10137953. The general public can access the call by dialing 1-888-338-6515. A replay of the conference call will be available through February 23, 2020 by dialing 1-877-344-7529; using Conference ID: 10137953.

About Univest Financial Corporation
Univest Financial Corporation (UVSP), including its wholly-owned subsidiary Univest Bank and Trust Co., Member FDIC, has approximately $5.4 billion in assets and $3.8 billion in assets under management and supervision through its Wealth Management lines of business at December 31, 2019. Headquartered in Souderton, Pa. and founded in 1876, the Corporation and its subsidiaries provide a full range of financial solutions for individuals, businesses, municipalities and nonprofit organizations primarily in the Mid-Atlantic Region. Univest delivers these services through a network of more than 50 offices in southeastern Pennsylvania extending to the Lehigh Valley and Lancaster, as well as in New Jersey and Maryland and online at www.univest.net.  
# # #
This press release of Univest and the reports Univest files with the Securities and Exchange Commission often contain "forward-looking statements" relating to present or future trends or factors affecting the financial services industry and, specifically, the financial operations, markets and products of Univest. These forward-looking statements involve certain risks and uncertainties. There are a number of important factors that could cause Univest's future results to differ materially from historical performance or projected performance. These factors include, but are not limited to: (1) competitive pressures


among financial institutions; (2) changes in the interest rate environment; (3) changes in asset quality, prepayment speeds, loan sale volumes, charge-offs and loan loss provisions; (4) general economic conditions; (5) legislative or regulatory changes that may adversely affect the businesses in which Univest is engaged; (6) technological issues that may adversely affect Univest financial operations or customers; (7) changes in the securities markets or (8) risk factors mentioned in the reports and registration statements Univest files with the Securities and Exchange Commission. Univest undertakes no obligation to revise these forward-looking statements or to reflect events or circumstances after the date of this press release.



Univest Financial Corporation
Consolidated Selected Financial Data (Unaudited)
December 31, 2019
(Dollars in thousands)
Balance Sheet (Period End)12/31/20199/30/20196/30/20193/31/201912/31/2018
Assets$5,375,614  $5,353,611  $5,154,298  $5,035,527  $4,984,347  
Investment securities441,599  448,447  468,833  466,883  473,306  
Loans held for sale5,504  2,893  1,498  921  1,754  
Loans and leases held for investment, gross4,386,836  4,251,933  4,167,904  4,067,879  4,006,574  
Allowance for loan and lease losses35,331  33,662  32,600  31,602  29,364  
Loans and leases held for investment, net4,351,505  4,218,271  4,135,304  4,036,277  3,977,210  
Total deposits4,354,765  4,337,991  4,122,110  4,003,153  3,885,933  
Noninterest-bearing deposits1,279,681  1,198,425  1,166,301  1,103,674  1,055,919  
NOW, money market and savings2,469,074  2,421,466  2,246,372  2,260,795  2,159,937  
Time deposits606,010  718,100  709,437  638,684  670,077  
Borrowings263,596  273,855  304,241  313,083  429,672  
Shareholders' equity675,122  664,299  651,670  637,606  624,133  
Balance Sheet (Average)For the three months ended,For the twelve months ended,
12/31/20199/30/20196/30/20193/31/201912/31/201812/31/201912/31/2018
Assets$5,400,533  $5,317,867  $5,170,448  $5,004,253  $4,890,519  $5,224,569  $4,737,772  
Investment securities445,932  460,099  471,422  470,196  464,684  461,841  456,612  
Loans and leases, gross4,280,430  4,170,485  4,123,069  4,017,362  3,894,298  4,148,619  3,776,940  
Deposits4,374,528  4,288,170  4,145,411  3,931,199  3,938,378  4,186,325  3,696,264  
Shareholders' equity672,647  659,523  645,538  631,574  619,204  652,453  612,197  
Asset Quality Data (Period End)
12/31/20199/30/20196/30/20193/31/201912/31/2018
Nonaccrual loans and leases, including nonaccrual troubled debt restructured loans and leases$38,578  $37,368  $25,147  $25,952  $26,208  
Accruing loans and leases 90 days or more past due143  2,488  1,379  636  192  
Accruing troubled debt restructured loans and leases54  54  55  270  542  
Total nonperforming loans38,775  39,910  26,581  26,858  26,942  
Other real estate owned516  495  540  540  1,187  
Total nonperforming assets$39,291  $40,405  $27,121  $27,398  $28,129  
Nonaccrual loans and leases / Loans and leases held for investment0.88 %0.88 %0.60 %0.64 %0.65 %
Nonperforming loans and leases / Loans and leases held for investment0.88 %0.94 %0.64 %0.66 %0.67 %
Nonperforming assets / Total assets0.73 %0.75 %0.53 %0.54 %0.56 %
Allowance for loan and lease losses$35,331  $33,662  $32,600  $31,602  $29,364  
Allowance for loan and lease losses / Loans and leases held for investment0.81 %0.79 %0.78 %0.78 %0.73 %
Allowance for loan and lease losses / Loans and leases held for investment (excluding acquired loans at period-end)0.85 %0.85 %0.85 %0.85 %0.81 %
Allowance for loan and lease losses / Nonaccrual loans and leases held for investment91.58 %90.08 %129.64 %121.77 %112.04 %
Allowance for loan and lease losses / Nonperforming loans and leases held for investment91.12 %84.34 %122.64 %117.66 %108.99 %
Acquired credit impaired loans $264  $568  $569  $693  $695  
For the three months ended,For the twelve months ended,
12/31/20199/30/20196/30/20193/31/201912/31/201812/31/201912/31/2018
Net loan and lease charge-offs (recoveries)$558  $468  $1,078  $447  $(1,890) $2,551  $12,501  
Net loan and lease charge-offs (recoveries) (annualized)/Average loans and leases0.05 %0.04 %0.10 %0.05 %(0.19 %)0.06 %0.33 %




Univest Financial Corporation
Consolidated Selected Financial Data (Unaudited)
December 31, 2019
(Dollars in thousands, except per share data)
For the three months ended,For the twelve months ended,
For the period:12/31/20199/30/20196/30/20193/31/201912/31/201812/31/201912/31/2018
Interest income$53,369  $54,300  $54,060  $52,364  $51,239  $214,093  $190,488  
Interest expense10,940  11,655  11,425  10,841  9,862  44,861  32,426  
Net interest income42,429  42,645  42,635  41,523  41,377  169,232  158,062  
Provision for loan and lease losses2,227  1,530  2,076  2,685  103  8,518  20,310  
Net interest income after provision40,202  41,115  40,559  38,838  41,274  160,714  137,752  
Noninterest income:
Trust fee income1,912  1,973  2,054  1,887  1,882  7,826  7,882  
Service charges on deposit accounts1,551  1,513  1,447  1,435  1,516  5,946  5,632  
Investment advisory commission and fee income4,064  4,032  4,055  3,789  3,852  15,940  15,098  
Insurance commission and fee income3,609  3,877  3,941  5,144  3,415  16,571  15,658  
Other service fee income2,229  2,255  2,590  2,267  2,448  9,341  9,332  
Bank owned life insurance income741  743  743  952  430  3,179  3,174  
Net gain on sales of investment securities13  33  7  1  —  54  10  
Net gain on mortgage banking activities1,038  1,629  796  483  713  3,946  3,125  
Other income1,013  544  723  339  160  2,619  262  
Total noninterest income16,170  16,599  16,356  16,297  14,416  65,422  60,173  
Noninterest expense:
Salaries, benefits and commissions21,933  22,758  22,052  21,546  19,544  88,289  80,488  
Net occupancy2,534  2,475  2,601  2,611  2,455  10,221  10,260  
Equipment1,027  1,088  1,065  990  1,014  4,170  4,146  
Data processing2,685  2,624  2,627  2,514  2,352  10,450  9,014  
Professional fees1,475  1,517  1,307  1,264  1,335  5,563  5,391  
Marketing and advertising710  558  786  540  655  2,594  2,642  
Deposit insurance premiums342  (444) 430  452  449  780  1,836  
Intangible expense374  378  417  426  481  1,595  2,166  
Restructuring charges—  —  —  —  —  —  571  
Other expense6,398  5,316  5,493  5,214  5,111  22,421  20,725  
Total noninterest expense37,478  36,270  36,778  35,557  33,396  146,083  137,239  
Income before taxes18,894  21,444  20,137  19,578  22,294  80,053  60,686  
Income tax expense3,384  3,782  3,669  3,499  3,922  14,334  10,143  
Net income$15,510  $17,662  $16,468  $16,079  $18,372  $65,719  $50,543  
Net income per share:
Basic$0.53  $0.60  $0.56  $0.55  $0.63  $2.24  $1.72  
Diluted$0.53  $0.60  $0.56  $0.55  $0.63  $2.24  $1.72  
Dividends declared per share$0.20  $0.20  $0.20  $0.20  $0.20  $0.80  $0.80  
Weighted average shares outstanding29,327,169  29,305,524  29,287,754  29,277,339  29,319,664  29,299,599  29,370,217  
Period end shares outstanding29,334,629  29,312,534  29,294,942  29,272,502  29,270,852  29,334,629  29,270,852  




Univest Financial Corporation
Consolidated Selected Financial Data (Unaudited)
December 31, 2019
For the three months ended,For the twelve months ended,
Profitability Ratios (annualized)12/31/20199/30/20196/30/20193/31/201912/31/201812/31/201912/31/2018
Return on average assets1.14 %1.32 %1.28 %1.30 %1.49 %1.26 %1.07 %
Return on average assets, excluding restructuring charges (1), (2)1.14 %1.32 %1.28 %1.30 %1.49 %1.26 %1.08 %
Return on average shareholders' equity9.15 %10.62 %10.23 %10.32 %11.77 %10.07 %8.26 %
Return on average shareholder's equity, excluding restructuring charges (1), (2)9.15 %10.62 %10.23 %10.32 %11.77 %10.07 %8.33 %
Return on average tangible common equity, excluding restructuring charges (1), (2)12.40 %14.52 %14.10 %14.36 %16.52 %13.82 %11.77 %
Net interest margin (FTE)3.44 %3.52 %3.67 %3.75 %3.72 %3.59 %3.72 %
Efficiency ratio (3)63.0 %60.4 %61.5 %60.5 %59.0 %61.4 %61.9 %
Efficiency ratio, excluding restructuring charges (1), (3), (4)63.0 %60.4 %61.5 %60.5 %59.0 %61.4 %61.6 %
Capitalization Ratios
Dividends declared to net income37.8 %33.2 %35.6 %36.4 %31.9 %35.7 %46.5 %
Shareholders' equity to assets (Period End)12.56 %12.41 %12.64 %12.66 %12.52 %12.56 %12.52 %
Tangible common equity to tangible assets (1)9.60 %9.42 %9.54 %9.47 %9.29 %9.60 %9.29 %
Common equity book value per share$23.01  $22.66  $22.25  $21.78  $21.32  $23.01  $21.32  
Tangible common equity book value per share (1)$17.01  $16.64  $16.20  $15.72  $15.25  $17.01  $15.25  
Regulatory Capital Ratios (Period End)
Tier 1 leverage ratio10.02 %9.97 %10.01 %10.10 %10.13 %10.02 %10.13 %
Common equity tier 1 risk-based capital ratio11.03 %11.03 %10.99 %10.93 %10.88 %11.03 %10.88 %
Tier 1 risk-based capital ratio11.03 %11.03 %10.99 %10.93 %10.88 %11.03 %10.88 %
Total risk-based capital ratio13.78 %13.81 %13.79 %13.77 %13.70 %13.78 %13.70 %
(1) This consolidated selected financial data schedule contains supplemental financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP”). The management of Univest uses these non-GAAP measures in its analysis of the Corporation's performance. These measures should not be considered a substitute for GAAP basis measures nor should they be viewed as a substitute for operating results determined in accordance with GAAP. Management believes the presentation of the non-GAAP financial measures, which exclude the impact of the specified items, provides useful supplemental information that is essential to a proper understanding of the financial results of the Corporation. See below tables for additional information. 
(a) Restructuring charges $—  $—  $—  $—  $—  $—  $571  
Tax effect on restructuring charges  —  —  —  —  —  —  (120) 
(b) Restructuring charges, net of tax $—  $—  $—  $—  $—  $—  $451  
(c) Shareholders' equity$675,122  $664,299  $651,670  $637,606  $624,133  $675,122  $624,133  
Goodwill(172,559) (172,559) (172,559) (172,559) (172,559) (172,559) (172,559) 
Other intangibles (i)(3,658) (4,026) (4,396) (4,805) (5,222) (3,658) (5,222) 
(d) Tangible common equity$498,905  $487,714  $474,715  $460,242  $446,352  $498,905  $446,352  
(e) Total assets$5,375,614  $5,353,611  $5,154,298  $5,035,527  $4,984,347  $5,375,614  $4,984,347  
Goodwill(172,559) (172,559) (172,559) (172,559) (172,559) (172,559) (172,559) 
Other intangibles (i)(3,658) (4,026) (4,396) (4,805) (5,222) (3,658) (5,222) 
(f) Tangible assets$5,199,397  $5,177,026  $4,977,343  $4,858,163  $4,806,566  $5,199,397  $4,806,566  
(g) Average shareholders' equity$672,647  $659,523  $645,538  $631,574  $619,204  $652,453  $612,197  
Average goodwill(172,559) (172,559) (172,559) (172,559) (172,559) (172,559) (172,559) 
Average other intangibles (i)(3,853) (4,234) (4,615) (5,031) (5,473) (4,430) (6,233) 
(h) Average tangible common equity$496,235  $482,730  $468,364  $453,984  $441,172  $475,464  $433,405  
(i) Amount does not include servicing rights 
(2) Net income in this ratio excludes restructuring charges, net of tax. See (1)(b) above. 
(3) Noninterest expense to net interest income before loan loss provision plus noninterest income adjusted for tax equivalent income. 
(4) Noninterest expense in this ratio excludes restructuring charges. See (1)(a) above. 




Univest Financial Corporation
Average Balances and Interest Rates (Unaudited)
For the Three Months Ended,
Tax Equivalent BasisDecember 31, 2019September 30, 2019
AverageIncome/AverageAverageIncome/Average
(Dollars in thousands)BalanceExpenseRateBalanceExpenseRate
Assets:
Interest-earning deposits with other banks$205,645  $860  1.66  %$213,623  $1,178  2.19  %
U.S. government obligations7,297  37  2.01  14,154  62  1.74  
Obligations of state and political subdivisions35,938  324  3.58  42,465  316  2.95  
Other debt and equity securities402,697  2,684  2.64  403,480  2,519  2.48  
Federal Home Loan Bank, Federal Reserve Bank and other stock30,653  514  6.65  30,857  519  6.67  
Total interest-earning deposits, investments and other interest-earning assets682,230  4,419  2.57  704,579  4,594  2.59  
Commercial, financial, and agricultural loans830,757  9,197  4.39  800,006  9,952  4.94  
Real estate—commercial and construction loans2,040,442  23,526  4.57  1,966,593  23,439  4.73  
Real estate—residential loans966,370  11,566  4.75  956,224  11,570  4.80  
Loans to individuals31,694  458  5.73  31,504  490  6.17  
Municipal loans and leases325,939  3,323  4.04  333,734  3,413  4.06  
Lease financings85,228  1,528  7.11  82,424  1,482  7.13  
     Gross loans and leases4,280,430  49,598  4.60  4,170,485  50,346  4.79  
          Total interest-earning assets4,962,660  54,017  4.32  4,875,064  54,940  4.47  
Cash and due from banks50,794  53,019  
Reserve for loan and lease losses(34,392) (33,152) 
Premises and equipment, net57,043  57,881  
Operating lease right-of-use assets34,693  35,238  
Other assets329,735  329,817  
      Total assets$5,400,533  $5,317,867  
Liabilities:
Interest-bearing checking deposits$566,904  $941  0.66  %$497,185  $678  0.54  %
Money market savings1,074,066  3,749  1.38  1,004,806  4,112  1.62  
Regular savings798,087  870  0.43  805,632  963  0.47  
Time deposits648,726  3,261  1.99  715,520  3,681  2.04  
     Total time and interest-bearing deposits3,087,783  8,821  1.13  3,023,143  9,434  1.24  
Short-term borrowings30,404  63  0.82  32,375  94  1.15  
Long-term debt153,049  795  2.06  167,338  866  2.05  
Subordinated notes94,786  1,261  5.28  94,724  1,261  5.28  
     Total borrowings278,239  2,119  3.02  294,437  2,221  2.99  
     Total interest-bearing liabilities3,366,022  10,940  1.29  3,317,580  11,655  1.39  
Noninterest-bearing deposits1,286,745  1,265,027  
Operating lease liabilities37,867  38,364  
Accrued expenses and other liabilities37,252  37,373  
     Total liabilities4,727,886  4,658,344  
Shareholders' Equity:
Common stock157,784  157,784  
Additional paid-in capital294,731  294,138  
Retained earnings and other equity220,132  207,601  
     Total shareholders' equity672,647  659,523  
     Total liabilities and shareholders' equity$5,400,533  $5,317,867  
Net interest income$43,077  $43,285  
Net interest spread3.03  3.08  
Effect of net interest-free funding sources0.41  0.44  
Net interest margin3.44  %3.52  %
Ratio of average interest-earning assets to average interest-bearing liabilities147.43  %146.95  %
Note 1: For rate calculation purposes, average loan and lease categories include deferred fees and costs, purchase accounting adjustments and unearned discount.
Nonaccrual loans and leases have been included in the average loan and lease balances. Loans held for sale have been included in the average loan balances.
Tax-equivalent amounts for the three months ended December 31, 2019 and September 30, 2019 have been calculated using the Corporation’s federal applicable rate of 21.0%.




Univest Financial Corporation
Average Balances and Interest Rates (Unaudited)
For the Three Months Ended December 31,
Tax Equivalent Basis20192018
AverageIncome/AverageAverageIncome/Average
(Dollars in thousands)BalanceExpenseRateBalanceExpenseRate
Assets:
Interest-earning deposits with other banks$205,645  $860  1.66  %$89,784  $480  2.12  %
U.S. government obligations7,297  37  2.01  22,307  89  1.58  
Obligations of state and political subdivisions35,938  324  3.58  65,134  553  3.37  
Other debt and equity securities402,697  2,684  2.64  377,243  2,494  2.62  
Federal Home Loan Bank, Federal Reserve Bank and other stock30,653  514  6.65  30,175  468  6.15  
Total interest-earning deposits, investments and other interest-earning assets682,230  4,419  2.57  584,643  4,084  2.77  
Commercial, financial, and agricultural loans830,757  9,197  4.39  782,666  10,322  5.23  
Real estate—commercial and construction loans2,040,442  23,526  4.57  1,766,543  21,309  4.79  
Real estate—residential loans966,370  11,566  4.75  910,620  11,102  4.84  
Loans to individuals31,694  458  5.73  31,902  511  6.35  
Municipal loans and leases325,939  3,323  4.04  323,904  3,160  3.87  
Lease financings85,228  1,528  7.11  78,663  1,407  7.10  
     Gross loans and leases4,280,430  49,598  4.60  3,894,298  47,811  4.87  
          Total interest-earning assets4,962,660  54,017  4.32  4,478,941  51,895  4.60  
Cash and due from banks50,794  47,429  
Reserve for loan and lease losses(34,392) (28,499) 
Premises and equipment, net57,043  60,448  
Operating lease right-of-use assets34,693  —  
Other assets329,735  332,200  
      Total assets$5,400,533  $4,890,519  
Liabilities:
Interest-bearing checking deposits$566,904  $941  0.66  %$491,749  $708  0.57  %
Money market savings1,074,066  3,749  1.38  889,165  3,372  1.50  
Regular savings798,087  870  0.43  768,825  637  0.33  
Time deposits648,726  3,261  1.99  676,256  2,958  1.74  
     Total time and interest-bearing deposits3,087,783  8,821  1.13  2,825,995  7,675  1.08  
Short-term borrowings30,404  63  0.82  56,215  233  1.64  
Long-term debt153,049  795  2.06  140,597  694  1.96  
Subordinated notes94,786  1,261  5.28  94,542  1,260  5.29  
     Total borrowings278,239  2,119  3.02  291,354  2,187  2.98  
     Total interest-bearing liabilities3,366,022  10,940  1.29  3,117,349  9,862  1.26  
Noninterest-bearing deposits1,286,745  1,112,383  
Operating lease liabilities37,867  —  
Accrued expenses and other liabilities37,252  41,583  
     Total liabilities4,727,886  4,271,315  
Shareholders' Equity:
Common stock157,784  157,784  
Additional paid-in capital294,731  292,342  
Retained earnings and other equity220,132  169,078  
     Total shareholders' equity672,647  619,204  
     Total liabilities and shareholders' equity$5,400,533  $4,890,519  
Net interest income$43,077  $42,033  
Net interest spread3.03  3.34  
Effect of net interest-free funding sources0.41  0.38  
Net interest margin3.44  %3.72  %
Ratio of average interest-earning assets to average interest-bearing liabilities147.43  %143.68  %
Note 1: For rate calculation purposes, average loan and lease categories include deferred fees and costs, purchase accounting adjustments and unearned discount.
Nonaccrual loans and leases have been included in the average loan and lease balances. Loans held for sale have been included in the average loan balances.
Tax-equivalent amounts for the three months ended December 31, 2019 and 2018 have been calculated using the Corporation’s federal applicable rate of 21.0%.




Univest Financial Corporation
Average Balances and Interest Rates (Unaudited)
For the Twelve Months Ended December 31,
Tax Equivalent Basis20192018
AverageIncome/AverageAverageIncome/Average
(Dollars in thousands)BalanceExpenseRateBalanceExpenseRate
Assets:
Interest-earning deposits with other banks$141,760  $2,876  2.03  %$56,984  $1,101  1.93  %
U.S. government obligations14,665  254  1.73  22,930  364  1.59  
Obligations of state and political subdivisions50,360  1,693  3.36  69,842  2,330  3.34  
Other debt and equity securities396,816  10,406  2.62  363,840  9,024  2.48  
Federal Home Loan Bank, Federal Reserve Bank and other stock31,446  2,154  6.85  30,786  1,965  6.38  
Total interest-earning deposits, investments and other interest-earning assets635,047  17,383  2.74  544,382  14,784  2.72  
Commercial, financial, and agricultural loans815,472  40,496  4.97  793,028  39,156  4.94  
Real estate—commercial and construction loans1,936,073  91,634  4.73  1,689,983  78,498  4.64  
Real estate—residential loans950,743  46,031  4.84  870,846  41,270  4.74  
Loans to individuals31,912  1,976  6.19  30,242  1,866  6.17  
Municipal loans and leases331,831  13,262  4.00  316,280  12,049  3.81  
Lease financings82,588  5,904  7.15  76,561  5,514  7.20  
     Gross loans and leases4,148,619  199,303  4.80  3,776,940  178,353  4.72  
          Total interest-earning assets4,783,666  216,686  4.53  4,321,322  193,137  4.47  
Cash and due from banks48,877  45,979  
Reserve for loan and lease losses(32,389) (25,154) 
Premises and equipment, net58,237  61,006  
Operating lease right-of-use assets35,712  —  
Other assets330,466  334,619  
      Total assets$5,224,569  $4,737,772  
Liabilities:
Interest-bearing checking deposits$500,295  $2,790  0.56  %$461,676  $1,924  0.42  %
Money market savings995,403  15,843  1.59  764,777  9,137  1.19  
Regular savings802,851  3,660  0.46  798,332  2,357  0.30  
Time deposits677,199  13,276  1.96  601,674  8,768  1.46  
     Total time and interest-bearing deposits2,975,748  35,569  1.20  2,626,459  22,186  0.84  
Short-term borrowings56,882  1,012  1.78  144,312  2,420  1.68  
Long-term debt156,366  3,236  2.07  150,032  2,777  1.85  
Subordinated notes94,695  5,044  5.33  94,451  5,043  5.34  
     Total borrowings307,943  9,292  3.02  388,795  10,240  2.63  
     Total interest-bearing liabilities3,283,691  44,861  1.37  3,015,254  32,426  1.08  
Noninterest-bearing deposits1,210,577  1,069,805  
Operating lease liabilities38,791  —  
Accrued expenses and other liabilities39,057  40,516  
     Total liabilities4,572,116  4,125,575  
Shareholders' Equity:
Common stock157,784  157,784  
Additional paid-in capital293,784  291,148  
Retained earnings and other equity200,885  163,265  
     Total shareholders' equity652,453  612,197  
     Total liabilities and shareholders' equity$5,224,569  $4,737,772  
Net interest income$171,825  $160,711  
Net interest spread3.16  3.39  
Effect of net interest-free funding sources0.43  0.33  
Net interest margin3.59  %3.72  %
Ratio of average interest-earning assets to average interest-bearing liabilities145.68  %  143.32  %
Note 1: For rate calculation purposes, average loan and lease categories include deferred fees and costs, purchase accounting adjustments and unearned discount.
Nonaccrual loans and leases have been included in the average loan and lease balances. Loans held for sale have been included in the average loan balances.
Tax-equivalent amounts for the twelve months ended December 31, 2019 and 2018 have been calculated using the Corporation’s federal applicable rate of 21.0%.