EX-99.1 2 c88210exv99w1.htm EXHIBIT 99.1 Exhibit 99.1
(UNIVEST LOGO)
         
CONTACT:
  Jeff Schweitzer   Exhibit 99.1
 
  UNIVEST CORPORATION OF PENNSYLVANIA    
 
  Chief Financial Officer    
 
  215-721-2458, schweitzerj@univest.net    
FOR IMMEDIATE RELEASE
UNIVEST CORPORATION OF PENNSYLVANIA — UNIVEST NATIONAL
BANK AND TRUST CO. — REPORTS SECOND QUARTER EARNINGS
SOUDERTON, Pa., July 23, 2009 — Univest Corporation of Pennsylvania (NASDAQ: UVSP), parent company of Univest National Bank and Trust Co. of Souderton, Pa., today announced financial results for the second quarter ended June 30, 2009. Univest reported net income of $2.7 million or $0.21 diluted earnings per share for the quarter ended June 30, 2009, compared to net income of $5.9 million or $0.46 diluted earnings per share for the quarter ended June 30, 2008. Net income for the second quarter of 2009 included a special FDIC assessment of $609 thousand after-tax.
For the six months ended June 30, 2009, Univest reported net income of $6.5 million or $0.50 diluted earnings per share compared to net income of $12.6 million or $0.98 diluted earnings per share reported for the six months ended June 30, 2008. The decrease year over year is primarily due to an increase in the provision for loan and lease losses of $4.2 million along with death benefit claims on bank owned life insurance policies in the prior year of $1.9 million. Additionally, FDIC deposit insurance premiums increased $2.0 million year over year.
“While our second quarter performance did not meet our expectations, we remain focused on our long term objectives during this very challenging economic time,” said William S. Aichele, Chairman, President and Chief Executive Officer of Univest Corporation. “Our steadfast approach to doing business helped sustain us during the quarter. Our diversified platform of financial solutions and strong commitment to our customers, communities, employees and shareholders continue to differentiate us from our competitors. We believe Univest is well positioned to take advantage of the growth opportunities this current market disruption presents, and we look to the future with optimism.”

 

 

 

Net Interest Income and Margin
Net interest income increased $608 thousand or 3.7% in the second quarter of 2009 from the second quarter of 2008. The result is from the growth in average loans of $79 million or 5.7% combined with a decrease in the cost of interest-bearing liabilities.
The net interest margin on a tax equivalent basis for the second quarter of 2009 increased 12 basis points to 3.87% compared to 3.75% for the second quarter of 2008. The increase in the net interest margin can be attributed to increased loan volume and declines in the cost of interest-bearing liabilities exceeding the declines in yields on total interest earning assets.
The net interest margin on a tax equivalent basis for the six months ended June 30, 2009 increased 11 basis points to 3.82% compared to 3.71% for the comparable period in the prior year. The increase in net interest margin is primarily due to increased loan volume and declines in the cost of interest-bearing liabilities exceeding the declines in yields on total interest earning assets. Average loans increased $85 million or 6.2% year over year, which was driven by an increase in average commercial loans of $102 million or 10.2%.
Non-Interest Income
Total non-interest income declined slightly for the quarter ended June 30, 2009 compared to the quarter ended June 30, 2008. For the quarter ended June 30, 2009, Univest reported total non-interest income of $7.8 million compared to $8.0 million for the comparable period in the prior year. This decline is due to $1.4 million of revenue from death benefit claims on bank owned life insurance in the prior year. Excluding this item, total non-interest income increased $1.2 million or 19.0%. This increase is primarily due to increased mortgage banking revenue of $651 thousand for the quarter ended June 30, 2009 compared to the same period in the prior year and increased revenues from the acquisitions of Trollinger Consulting Group and Liberty Benefits, Inc. at the end of 2008.
Total non-interest income for the six months ended June 30, 2009 declined $1.7 million compared to the corresponding period in the prior year. This decline is due to $1.9 million of revenue from death benefit claims on bank owned life insurance in the prior year and other than temporary impairment on bank equity securities of $1.4 million recorded during the six months ended June 30, 2009 compared to $235 thousand recorded during the six months ended June 30, 2008. Excluding these items, total non-interest income increased $1.3 million compared to the same period in the prior year primarily due to increased mortgage banking revenue of $1.1 million along with increased revenues from the acquisitions of Trollinger Consulting Group and Liberty Benefits, Inc.

 

 

 

Non-Interest Expense
Non-interest expense for the second quarter of 2009 increased $1.7 million, or 11.3%, primarily due to higher FDIC insurance costs, salaries and employee benefits expense. FDIC insurance costs increased $1.4 million quarter over quarter primarily due to premium increases affecting all financial institutions along with the special assessment levied on all banks which cost Univest $937 thousand during the quarter. Salary and employee benefits expenses increased primarily due to increased pension costs, normal merit increases and increased headcount due to the acquisitions of Trollinger Consulting Group and Liberty Benefits, Inc along with increased staff from our recent mortgage banking initiative.
Non-interest expense for the six months ended June 30, 2009 increased $3.6 million, or 12.5%, primarily due to higher FDIC insurance costs, salaries and employee benefits expense. FDIC insurance costs increased $2.0 million year over year. Salaries and employee benefits expense increased $2.7 million primarily due to increased pension expenses of $535 thousand along with normal merit increases combined with increased headcount from the acquisitions completed at the end of the year along with our recent mortgage banking initiatives.
Credit Quality and Provision for Loan and Lease Losses
Nonaccrual loans and leases were $5.8 million at June 30, 2009 compared to $3.7 million at March 31, 2009 and $5.0 million at December 31, 2008. Nonperforming loans and leases as a percentage of total loans and leases equaled 0.75% at June 30, 2009 compared to 0.45% at March 31, 2009 and 0.45% at December 31, 2008. The increase from the prior quarter and year-end is primarily due to an increase in restructured loans. Net loan and lease charge-offs for the six months ended June 30, 2009 were $1.8 million or 0.25% of average loans and leases compared to $2.7 million or 0.39% for the six months ended June 30, 2008. The provision for loan and lease losses was $5.4 million for the second quarter of 2009 compared to $2.3 million for the corresponding quarter in the prior year. For the six months ended June 30, 2009, the provision for loan and lease losses was $7.5 million compared to $3.3 million in the prior year. The increase in the provision is due to the deterioration of underlying collateral and economic factors. As a result of the increased provision, the allowance for loan and leases as a percentage of total loans and leases increased to 1.28% from 1.01% at March 31, 2009 and 0.90% at December 31, 2008. The allowance for loan and lease losses to nonperforming loans and leases equaled 172.30% at June 30, 2009.
On July 1, 2009, Univest Corporation paid a quarterly cash dividend of $0.20 per share.

 

 

 

About Univest Corporation
Headquartered in Souderton, Pa., Univest Corporation of Pennsylvania (www.univest.net) and its subsidiaries serve the financial needs of residents, businesses, and nonprofit organizations in Bucks, Chester, Montgomery and Lehigh counties. Univest National Bank and Trust Co., member FDIC and Equal Housing Lender, offers customers 32 financial service centers, 12 retirement financial services centers, and 38 ATM locations throughout the region, and is the parent company of Univest Capital, Inc., a small ticket commercial finance business; Univest Insurance, Inc., an independent insurance agency headquartered in Lansdale, Pa., which serves commercial and personal customers; and Univest Investments, Inc., Member FINRA and SIPC, a full-service broker-dealer and investment advisory firm. For more information on Univest Corporation of Pennsylvania and its subsidiaries, please visit www.univest.net.
# # #
This press release may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various factors. Such factors include the possibility that increased demand or prices for the Company’s financial services and products may not occur, changing economic and competitive conditions, technological developments, and other risks and uncertainties, including those detailed in the company’s filings with the Securities and Exchange Commission.

 

 

 

Univest Corporation of Pennsylvania
Consolidated Selected Financial Data
6/30/2009
(Dollars in thousands)
                                                         
Balance Sheet (Period End)   06/30/09     03/31/09     12/31/08     09/30/08     06/30/08                  
Assets
   $ 2,086,821     $ 2,065,901     $ 2,084,797     $ 2,046,390     $ 2,012,659                  
Securities
     425,774       410,357       432,266       406,965       419,804                  
Loans and leases, gross
     1,466,005       1,455,492       1,450,436       1,441,899       1,398,269                  
Allowance for loan and lease losses
     18,824       14,720       13,118       14,954       13,713                  
Loans and leases, net
     1,447,181       1,440,772       1,437,318       1,426,945       1,384,556                  
Total deposits
     1,565,076       1,573,052       1,527,328       1,507,527       1,504,007                  
Non-interest bearing deposits
     222,877       218,148       221,863       226,606       233,436                  
NOW, Money Market and Savings
     833,825       819,659       795,495       783,830       788,177                  
Time deposits
     508,374       535,245       509,970       497,091       482,394                  
Borrowings
     265,457       245,962       312,736       304,368       275,343                  
Shareholders’ equity
     208,358       206,238       203,207       204,251       203,138                  
 
                                                        
    For the three months ended,     For the six months ended  
Balance Sheet (Average)   06/30/09     03/31/09     12/31/08     09/30/08     06/30/08     06/30/09     06/30/08  
Assets
   $ 2,077,565     $ 2,059,965     $ 2,028,900     $ 2,020,537     $ 2,044,987     $ 2,068,700     $ 2,025,337  
Securities
     413,142       419,995       403,783       412,271       450,070       416,550       445,802  
Loans and leases, gross
     1,471,243       1,446,157       1,437,727       1,422,774       1,392,177       1,458,768       1,373,380  
Deposits
     1,560,317       1,555,964       1,523,964       1,503,402       1,560,015       1,558,152       1,562,853  
Shareholders’ equity
     208,321       204,544       205,384       205,062       205,464       206,443       202,954  
 
                                                        
Asset Quality Data (Period End)   06/30/09     03/31/09     12/31/08     09/30/08     06/30/08                  
Nonaccrual loans and leases
   $ 5,762     $ 3,675     $ 5,029     $ 7,871     $ 6,992                  
Troubled debt restructured
     3,324       747       380       563       423                  
Other real estate owned
     2,812       2,824       346       346       —                  
Nonperforming assets
     13,737       9,355       6,900       10,358       10,422                  
Allowance for loan and lease losses
     18,824       14,720       13,118       14,954       13,713                  
Nonperforming loans and leases / Loans and leases
     0.75 %     0.45 %     0.45 %     0.69 %     0.75 %                
Allowance for loan and lease losses / Loans and leases
     1.28 %     1.01 %     0.90 %     1.04 %     0.98 %                
Allowance for loan and lease losses / Nonperforming loans
     172.30 %     225.39 %     200.15 %     149.36 %     131.58 %                
 
                                                        
    For the three months ended,     For the six months ended  
    06/30/09     03/31/09     12/31/08     09/30/08     06/30/08     06/30/09     06/30/08  
Net loan and lease charge-offs
   $ 1,248     $ 554     $ 4,263     $ 1,804     $ 1,582     $ 1,802     $ 2,670  
Net loan and lease charge-offs (annualized) / Average loans and leases
     0.34 %     0.16 %     1.18 %     0.50 %     0.46 %     0.25 %     0.39 %

 

 

 

Univest Corporation of Pennsylvania
Consolidated Selected Financial Data
June 30, 2009
(Dollars in thousands, except per share data)
                                                         
    For the three months ended,     For the six months ended  
For the period:   06/30/09     03/31/09     12/31/08     09/30/08     06/30/08     06/30/09     06/30/08  
 
                                                        
Interest income
   $ 24,529     $ 24,402     $ 26,455     $ 26,661     $ 26,935     $ 48,931     $ 54,942  
Interest expense
     7,356       8,057       9,630       10,148       10,370       15,413       22,532  
 
                                          
Net interest income
     17,173       16,345       16,825       16,513       16,565       33,518       32,410  
Provision for loan and lease losses
     5,353       2,156       2,427       3,046       2,297       7,509       3,296  
 
                                          
Net interest income after provision
     11,820       14,189       14,398       13,467       14,268       26,009       29,114  
Noninterest income:
                                                        
Trust fee income
     1,325       1,425       1,171       1,578       1,628       2,750       3,255  
Service charges on deposit accounts
     1,692       1,613       1,723       1,719       1,708       3,305       3,366  
Investment advisory commission and fee income
     917       907       536       581       642       1,824       1,257  
Insurance commissions and fee income
     1,813       1,986       1,128       1,266       1,271       3,799       3,329  
Bank owned life insurance income
     408       157       25       241       1,734       565       2,525  
Net loss on sales of and impairments on securities
     (245 )     (1,140 )     (122 )     (692 )     (213 )     (1,385 )     (157 )
Gain on sales of loans held for sale
     669       261       21       26       16       930       35  
Other income
     1,247       965       846       845       1,193       2,212       2,112  
 
                                          
Total noninterest income
     7,826       6,174       5,328       5,564       7,979       14,000       15,722  
Noninterest expense
                                             5,623          
Salaries and benefits
     9,417       9,432       8,291       7,935       8,019       18,849       16,187  
Premises and equipment
     2,125       2,233       2,225       2,110       2,085       4,358       4,142  
Deposit insurance premiums
     1,477       583       477       183       64       2,060       107  
Other expense
     3,771       3,255       3,874       3,437       4,917       7,026       8,257  
 
                                          
Total noninterest expense
     16,790       15,503       14,867       13,665       15,085       32,293       28,693  
 
                                          
Income before taxes
     2,856       4,860       4,859       5,366       7,162       7,716       16,143  
Applicable income taxes
     187       1,024       1,054       1,176       1,288       1,211       3,548  
 
                                          
Net income
   $ 2,669     $ 3,836     $ 3,805     $ 4,190     $ 5,874     $ 6,505     $ 12,595  
 
                                          
 
                                                        
Per Common Share Data:
                                                        
Book value per share
   $ 16.00     $ 15.87     $ 15.71     $ 15.83     $ 15.80     $ 16.00     $ 15.80  
Net income per share:
                                                        
Basic
   $ 0.21     $ 0.30     $ 0.30     $ 0.33     $ 0.46     $ 0.50     $ 0.98  
Diluted
   $ 0.21     $ 0.30     $ 0.29     $ 0.33     $ 0.46     $ 0.50     $ 0.98  
Dividends per share
   $ 0.20     $ 0.20     $ 0.20     $ 0.20     $ 0.20     $ 0.40     $ 0.40  
Weighted average shares outstanding
     13,023,148       12,977,369       12,921,814       12,874,648       12,855,379       13,000,406       12,847,230  
Period end shares outstanding
     13,023,704       12,996,291       12,938,514       12,905,326       12,858,376       13,023,704       12,858,376  

 

 

 

Univest Corporation of Pennsylvania
Consolidated Selected Financial Data
June 30, 2009
                                                         
    For the three months ended,     Year to date  
Profitability Ratios (annualized)   06/30/09     03/31/09     12/31/08     09/30/08     06/30/08     06/30/09     06/30/08  
 
                                                        
Return on average assets
     0.52 %     0.76 %     0.75 %     0.82 %     1.16 %     0.63 %     1.25 %
Return on average shareholders’ equity
     5.14 %     7.61 %     7.37 %     8.13 %     11.50 %     6.35 %     12.48 %
Net interest margin (FTE)
     3.87 %     3.76 %     3.83 %     3.79 %     3.75 %     3.82 %     3.71 %
Efficiency ratio (1)
     63.96 %     65.70 %     64.51 %     59.35 %     57.51 %     64.78 %     56.27 %
 
                                                        
Capitalization Ratios
                                                        
 
                                                        
Dividends paid to net income
     97.60 %     67.75 %     67.94 %     61.50 %     43.77 %     80.00 %     40.81 %
Shareholders’ equity to assets (Period End)
     9.98 %     9.98 %     9.75 %     9.98 %     10.09 %     9.98 %     10.09 %
     
(1)   Total operating expenses to net interest income before loan loss provision plus non-interest income adjusted for tax equivalent income.