SOUDERTON, Pa., July 24, 2019 (GLOBE NEWSWIRE) -- 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 quarter ended June 30, 2019 of $16.5 million, or $0.56 diluted earnings per share, compared to net income of $4.4 million, or $0.15 diluted earnings per share, for the quarter ended June 30, 2018. Net income for the six months ended June 30, 2019 was $32.5 million, or $1.11 diluted earnings per share, compared to net income of $17.2 million, or $0.58 diluted earnings per share, for the six months ended June 30, 2018.

The financial results for the three and six months ended June 30, 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), which represented $0.34 diluted earnings per share in each period, related to fraudulent activities by employees of a borrower. In addition, the three and six months ended June 30, 2018 included a tax-free bank owned life insurance (BOLI) death benefit of $446 thousand, which represented $0.02 diluted earnings per share for each period. The six months ended June 30, 2018 included 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 $100.0 million, or 9.8% (annualized), from March 31, 2019 and $161.3 million, or 8.1% (annualized), from December 31, 2018 and $349.5 million, or 9.2%, from June 30, 2018 primarily due to growth in commercial real estate and residential real estate loans.

Deposits
Total deposits increased $119.0 million, or 11.9% (annualized), from March 31, 2019 and $236.2 million, or 12.2% (annualized), from December 31, 2018 and $501.3 million, or 13.8%, from June 30, 2018. The growth in deposits from March 31, 2019 and December 31, 2018 was primarily due to increases in commercial, public funds and consumer deposits. The growth in deposits from June 30, 2018 was primarily due to increases in commercial and public funds deposits.

Net Interest Income and Margin
Net interest income of $84.2 million for the six months ended June 30, 2019 increased $7.9 million, or 10.4%, from the six months ended June 30, 2018. The increase in net interest income for the six months ended June 30, 2019 compared to the same period in 2018 was primarily due to the growth in loans during the last year.

Net interest margin, on a tax-equivalent basis, was 3.67% for the second quarter of 2019, compared to 3.75% for the first quarter of 2019 and 3.73% for the second quarter of 2018. The favorable impact of purchase accounting accretion was one basis point for the quarters ended June 30, 2019 and March 31, 2019 and three basis points for the quarter ended June 30, 2018. Excluding the impact of purchase accounting accretion, the net interest margin, on a tax-equivalent basis, was 3.66% for the quarter ended June 30, 2019 compared to 3.74% for the quarter ended March 31, 2019 and 3.70% for the quarter ended June 30, 2018. During the quarter ended June 30, 2019, excess liquidity reduced net interest margin by approximately 5 basis points. This excess liquidity was primarily driven by strong deposit balance growth throughout the quarter.

Noninterest Income
Noninterest income for the quarter ended June 30, 2019 was $16.4 million, an increase of $1.0 million, or 6.8%, from the second quarter of 2018. Noninterest income for the six months ended June 30, 2019 was $32.7 million, an increase of $1.8 million, or 5.7%, from the comparable period in the prior year.

Investment advisory commission and fee income increased $277 thousand, or 7.3%, for the quarter and $383 thousand, or 5.1%, for the six months ended June 30, 2019, primarily due to new customer relationships. Insurance commission and fee income increased $229 thousand, or 6.2%, for the quarter and $485 thousand, or 5.6%, for the six months ended June 30, 2019, primarily due to an increase in premiums for commercial lines and group life and health and an increase in contingent commission income of $120 thousand for the six months ended June 30, 2019. Service charges on deposit accounts increased $112 thousand, or 8.4%, for the quarter and $220 thousand, or 8.3%, for the six months ended June 30, 2019, primarily due to increased fee income on commercial cash management accounts. Other service fee income increased $159 thousand, or 6.5%, for the quarter and $257 thousand, or 5.6%, for the six months ended June 30, 2019, primarily due to increases in debit card interchange income.

Other income increased $861 thousand for the quarter and $1.1 million for the six months ended June 30, 2019. Fees on risk participation agreements increased $284 thousand for the quarter and $543 thousand for the six months ended June 30, 2019 driven by increased customer activity. Gain on sale of small business administration (SBA) loans increased $259 thousand for the quarter and $313 thousand for the six months ended June 30, 2019 related to increased SBA loan sale activity. Net loss on valuations and sales of other real estate owned was $55 thousand for the six months ended June 30, 2019 compared to $482 thousand for the three and six months ended June 30, 2018.

These increases were partially offset by a decrease in BOLI income of $467 thousand, or 38.6%, for the quarter and $184 thousand, or 9.8%, for the six months ended June 30, 2019. These decreases were primarily due to proceeds from BOLI death benefits of $446 thousand recognized in the second quarter of 2018. The net gain on mortgage banking activities decreased $146 thousand, or 15.5%, for the quarter and $379 thousand, or 22.9% for the six months ended June 30, 2019, primarily due to contraction in margins to remain price competitive.

Noninterest Expense
Noninterest expense for the quarter ended June 30, 2019 was $36.8 million, an increase of $2.4 million, or 7.1%, compared to the second quarter of 2018. Noninterest expense for the six months ended June 30, 2019 was $72.3 million, an increase of $2.9 million, or 4.1%, from the comparable period in the prior year.

Salaries, benefits and commissions increased $2.0 million, or 10.1%, for the quarter and $2.9 million, or 7.2%, for the six months ended June 30, 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 $536 thousand, or 25.6%, for the quarter and $818 thousand, or 18.9%, for the six months ended June 30, 2019, primarily due to continued investments in customer relationship management software, internal infrastructure improvements and outsourced data processing solutions. 

These increases were partially offset by a decrease in intangibles expense of $177 thousand, or 29.8%, for the quarter and $363 thousand, or 30.1%, for the six months ended June 30, 2019 due to run-off of the intangible assets. In addition, restructuring costs related to financial center closures and staffing rationalization were $571 thousand during the first quarter of 2018. Excluding restructuring costs, noninterest expense for six months ended June 30, 2019 increased $3.4 million, or 5.0%, from the comparable period in 2018.

Asset Quality and Provision for Loan and Lease Losses
Nonperforming assets were $27.1 million at June 30, 2019, compared to $28.1 million at December 31, 2018 and $32.8 million at June 30, 2018.

Net loan and lease charge-offs were $1.1 million during the second quarter of 2019 and $1.5 million for the six months ended June 30, 2019. The provision for loan and lease losses was $2.1 million for the second quarter of 2019 and $4.8 million for the six months ended June 30, 2019. Net loan and lease charge-offs were $13.2 million during the second quarter of 2018 and $13.4 million for the six months ended June 30, 2018. The provision for loan and lease losses was $15.4 million for the second quarter of 2018 and $17.5 million for the six months ended June 30, 2018. Both net loan and lease charge-offs and the provision for loan and lease losses during 2018 included the previously discussed $12.7 million commercial loan 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 June 30, 2019, compared to 0.81% at December 31, 2018 and 0.76% at June 30, 2018.

Tax Provision  
The effective income tax rate was 18.2% for the quarter June 30, 2019 compared to an effective income tax rate of 4.2% for the quarter ended June 30, 2018. The effective income tax rate was 18.0% for the six months ended June 30, 2019 compared to an effective income tax rate of 14.9% for the six months ended June 30, 2018. The Corporation's effective income tax rate for the six months ended June 30, 2019 was favorably impacted by discrete tax benefits. Excluding these items, the effective tax rate was 18.3% for the six months ended June 30, 2019.

Dividend
On May 20, 2019, Univest declared a quarterly cash dividend of $0.20 per share, payable on July 1, 2019. This represented a 3.06% 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 second quarter 2019 results on Thursday, July 25, 2019 at 9:00 a.m. EDT. Participants may preregister at http://dpregister.com/10133126. The general public can access the call by dialing 1-888-338-6515. A replay of the conference call will be available through August 25, 2019 by dialing 1-877-344-7529; using Conference ID: 10133126.

About Univest Financial Corporation

Univest Financial Corporation (UVSP), including its wholly-owned subsidiary Univest Bank and Trust Co., Member FDIC, has approximately $5.2 billion in assets and $3.7 billion in assets under management and supervision through its Wealth Management lines of business at June 30, 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 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 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)
June 30, 2019
(Dollars in thousands)
Balance Sheet (Period End)		06/30/19				03/31/19				12/31/18				09/30/18				06/30/18
Assets		$	5,154,298			$	5,035,527			$	4,984,347			$	4,801,998			$	4,749,181
Investment securities			468,833				466,883				473,306				447,339				446,933
Loans held for sale			1,498				921				1,754				106				1,778
Loans and leases held for investment, gross			4,167,904				4,067,879				4,006,574				3,866,169				3,818,398
Allowance for loan and lease losses			32,600				31,602				29,364				27,371				25,652
Loans and leases held for investment, net			4,135,304				4,036,277				3,977,210				3,838,798				3,792,746
Total deposits			4,122,110				4,003,153				3,885,933				3,820,048				3,620,786
Noninterest-bearing deposits			1,166,301				1,103,674				1,055,919				1,047,081				1,055,479
NOW, money market and savings			2,246,372				2,260,795				2,159,937				2,101,484				1,970,912
Time deposits			709,437				638,684				670,077				671,483				594,395
Borrowings			304,241				313,083				429,672				326,709				481,862
Shareholders' equity			651,670				637,606				624,133				614,242				605,294
Balance Sheet (Average)		For the three months ended,																				For the six months ended,
		06/30/19				03/31/19				12/31/18				09/30/18				06/30/18				06/30/19				06/30/18
Assets		$	5,170,448			$	5,004,253			$	4,890,519			$	4,817,321			$	4,682,827			$	5,087,810			$	4,619,714
Investment securities			471,422				470,196				464,684				453,422				450,375				470,812				454,130
Loans and leases, gross			4,123,069				4,017,362				3,894,298				3,832,295				3,743,195				4,070,508				3,689,152
Deposits			4,145,411				3,931,199				3,938,378				3,792,627				3,563,956				4,038,897				3,524,221
Shareholders' equity			645,538				631,574				619,204				611,803				611,667				638,595				608,835
Asset Quality Data (Period End)
		06/30/19				03/31/19				12/31/18				09/30/18				06/30/18
Nonaccrual loans and leases, including nonaccrual troubled debt restructured
loans and leases		$	25,147			$	25,952			$	26,208			$	27,559			$	30,148
Accruing loans and leases 90 days or more past due			1,379				636				192				1,224				150
Accruing troubled debt restructured loans and leases			55				270				542				766				790
Total nonperforming loans and leases			26,581				26,858				26,942				29,549				31,088
Other real estate owned			540				540				1,187				1,433				1,742
Total nonperforming assets			27,121				27,398				28,129				30,982				32,830
Nonaccrual loans and leases / Loans and leases held for investment			0.60	%			0.64	%			0.65	%			0.71	%			0.79	%
Nonperforming loans and leases / Loans and leases held for investment			0.64	%			0.66	%			0.67	%			0.76	%			0.81	%
Nonperforming assets / Total assets			0.53	%			0.54	%			0.56	%			0.65	%			0.69	%
Allowance for loan and lease losses			32,600				31,602				29,364				27,371				25,652
Allowance for loan and lease losses / Loans and leases held for investment			0.78	%			0.78	%			0.73	%			0.71	%			0.67	%
Allowance for loan and lease losses / Loans and leases held for investment			0.85	%			0.85	%			0.81	%			0.79	%			0.76	%
(excluding acquired loans at period-end)
Allowance for loan and lease losses / Nonaccrual loans and leases held for investment			129.64	%			121.77	%			112.04	%			99.32	%			85.09	%
Allowance for loan and lease losses / Nonperforming loans and leases held for investment			122.64	%			117.66	%			108.99	%			92.63	%			82.51	%
Acquired credit impaired loans		$	569			$	693			$	695			$	900			$	998
		For the three months ended,																				For the six months ended,
		06/30/19				03/31/19				12/31/18				09/30/18				06/30/18				06/30/19				06/30/18
Net loan and lease charge-offs (recoveries)		$	1,078			$	447			$	(1,890	)		$	1,026			$	13,167			$	1,525			$	13,365
Net loan and lease charge-offs (recoveries) (annualized)/Average loans and leases			0.10	%			0.05	%			(0.19	%)			0.11	%			1.41	%			0.08	%			0.73	%

 

Univest Financial Corporation
Consolidated Selected Financial Data (Unaudited)
June 30, 2019
(Dollars in thousands, except per share data)
		For the three months ended,																For the six months ended,
For the period:		06/30/19			03/31/19			12/31/18			09/30/18			06/30/18				06/30/19			06/30/18
Interest income		$	54,060		$	52,364		$	51,239		$	49,255		$	46,460			$	106,424		$	89,994
Interest expense			11,425			10,841			9,862			8,832			7,470				22,266			13,732
Net interest income			42,635			41,523			41,377			40,423			38,990				84,158			76,262
Provision for loan and lease losses			2,076			2,685			103			2,745			15,409				4,761			17,462
Net interest income after provision			40,559			38,838			41,274			37,678			23,581				79,397			58,800
Noninterest income:
Trust fee income			2,054			1,887			1,882			1,960			2,044				3,941			4,040
Service charges on deposit accounts			1,447			1,435			1,516			1,454			1,335				2,882			2,662
Investment advisory commission and fee income			4,055			3,789			3,852			3,785			3,778				7,844			7,461
Insurance commission and fee income			3,941			5,144			3,415			3,643			3,712				9,085			8,600
Other service fee income			2,590			2,267			2,448			2,284			2,431				4,857			4,600
Bank owned life insurance income			743			952			430			865			1,210				1,695			1,879
Net gain on sales of investment securities			7			1			-			-			-				8			10
Net gain on mortgage banking activities			796			483			713			754			942				1,279			1,658
Other income (loss)			723			339			160			116			(138	)			1,062			(14	)
Total noninterest income			16,356			16,297			14,416			14,861			15,314				32,653			30,896
Noninterest expense:
Salaries, benefits and commissions			22,089			21,564			19,576			20,321			20,065				43,653			40,712
Net occupancy			2,601			2,611			2,455			2,515			2,533				5,212			5,290
Equipment			1,065			990			1,014			1,042			1,067				2,055			2,090
Data processing			2,627			2,514			2,352			2,339			2,091				5,141			4,323
Professional fees			1,307			1,264			1,335			1,370			1,331				2,571			2,686
Marketing and advertising			622			316			432			461			526				938			907
Deposit insurance premiums			430			452			449			544			452				882			843
Intangible expenses			417			426			481			479			594				843			1,206
Restructuring charges			-			-			-			-			-				-			571
Other expense			5,620			5,420			5,302			5,300			5,688				11,040			10,844
Total noninterest expense			36,778			35,557			33,396			34,371			34,347				72,335			69,472
Income before taxes			20,137			19,578			22,294			18,168			4,548				39,715			20,224
Income tax expense			3,669			3,499			3,922			3,204			191				7,168			3,017
Net income		$	16,468		$	16,079		$	18,372		$	14,964		$	4,357			$	32,547		$	17,207
Net income per share:
Basic		$	0.56		$	0.55		$	0.63		$	0.51		$	0.15			$	1.11		$	0.59
Diluted		$	0.56		$	0.55		$	0.63		$	0.51		$	0.15			$	1.11		$	0.58
Dividends declared per share		$	0.20		$	0.20		$	0.20		$	0.20		$	0.20			$	0.40		$	0.40
Weighted average shares outstanding			29,287,754			29,277,339			29,319,664			29,402,405			29,403,946				29,282,575			29,379,552
Period end shares outstanding			29,294,942			29,272,502			29,270,852			29,407,076			29,406,450				29,294,942			29,406,450

 

Univest Financial Corporation
Consolidated Selected Financial Data (Unaudited)
June 30, 2019
		For the three months ended,																				For the six months ended,
Profitability Ratios (annualized)		06/30/19				03/31/19				12/31/18				09/30/18				06/30/18				06/30/19				06/30/18
Return on average assets			1.28	%			1.30	%			1.49	%			1.23	%			0.37	%			1.29	%			0.75	%
Return on average assets, excluding restructuring charges (1), (2)			1.28	%			1.30	%			1.49	%			1.23	%			0.37	%			1.29	%			0.77	%
Return on average shareholders' equity			10.23	%			10.32	%			11.77	%			9.70	%			2.86	%			10.28	%			5.70	%
Return on average shareholders' equity, excluding			10.23	%			10.32	%			11.77	%			9.70	%			2.86	%			10.28	%			5.85	%
restructuring charges (1), (2)
Return on average tangible common equity, excluding			14.10	%			14.36	%			16.52	%			13.70	%			4.04	%			14.23	%			8.29	%
restructuring charges (1), (2)
Net interest margin (FTE)			3.67	%			3.75	%			3.72	%			3.71	%			3.73	%			3.71	%			3.72	%
Efficiency ratio (3)			61.5	%			60.5	%			59.0	%			61.2	%			62.1	%			61.0	%			63.7	%
Efficiency ratio, excluding restructuring charges (1), (3), (4)			61.5	%			60.5	%			59.0	%			61.2	%			62.1	%			61.0	%			63.2	%
Capitalization Ratios
Dividends declared to net income			35.6	%			36.4	%			31.9	%			39.3	%			135.0	%			36.0	%			68.3	%
Shareholders' equity to assets (Period End)			12.64	%			12.66	%			12.52	%			12.79	%			12.75	%			12.64	%			12.75	%
Tangible common equity to tangible assets (1)			9.54	%			9.47	%			9.29	%			9.43	%			9.33	%			9.54	%			9.33	%
Common equity book value per share		$	22.25			$	21.78			$	21.32			$	20.89			$	20.58			$	22.25			$	20.58
Tangible common equity book value per share  (1)		$	16.20			$	15.72			$	15.25			$	14.83			$	14.51			$	16.20			$	14.51
Regulatory Capital Ratios  (Period End)
Tier 1 leverage ratio			10.01	%			10.10	%			10.13	%			10.07	%			10.19	%			10.01	%			10.19	%
Common equity tier 1 risk-based capital ratio			10.99	%			10.93	%			10.88	%			10.99	%			10.89	%			10.99	%			10.89	%
Tier 1 risk-based capital ratio			10.99	%			10.93	%			10.88	%			10.99	%			10.89	%			10.99	%			10.89	%
Total risk-based capital ratio			13.79	%			13.77	%			13.70	%			13.87	%			13.76	%			13.79	%			13.76	%
(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 Financial Corporation 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 table for additional information.
	(a) Restructuring charges	$	-			$	-			$	-			$	-			$	-			$	-			$	571
	Tax effect on restructuring charges		-				-				-				-				-				-				(120	)
	(b) Restructuring charges, net of tax	$	-			$	-			$	-			$	-			$	-			$	-			$	451
	(c) Shareholders' equity	$	651,670			$	637,606			$	624,133			$	614,242			$	605,294			$	651,670			$	605,294
	Goodwill		(172,559	)			(172,559	)			(172,559	)			(172,559	)			(172,559	)			(172,559	)			(172,559	)
	Other intangibles (i)		(4,396	)			(4,805	)			(5,222	)			(5,690	)			(6,159	)			(4,396	)			(6,159	)
	(d) Tangible common equity	$	474,715			$	460,242			$	446,352			$	435,993			$	426,576			$	474,715			$	426,576
	(e) Total assets	$	5,154,298			$	5,035,527			$	4,984,347			$	4,801,998			$	4,749,181			$	5,154,298			$	4,749,181
	Goodwill		(172,559	)			(172,559	)			(172,559	)			(172,559	)			(172,559	)			(172,559	)			(172,559	)
	Other intangibles (i)		(4,396	)			(4,805	)			(5,222	)			(5,690	)			(6,159	)			(4,396	)			(6,159	)
	(f) Tangible assets	$	4,977,343			$	4,858,163			$	4,806,566			$	4,623,749			$	4,570,463			$	4,977,343			$	4,570,463
	(g) Average shareholders' equity	$	645,538			$	631,574			$	619,204			$	611,803			$	611,667			$	638,595			$	608,835
	Average goodwill		(172,559	)			(172,559	)			(172,559	)			(172,559	)			(172,559	)			(172,559	)			(172,559	)
	Average other intangibles (i)		(4,615	)			(5,031	)			(5,473	)			(5,947	)			(6,468	)			(4,821	)			(6,764	)
	(h) Average tangible common equity	$	468,364			$	453,984			$	441,172			$	433,297			$	432,640			$	461,215			$	429,512
	(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 Basis	June 30, 2019								March 31, 2019
	Average			Income/		Average			Average				Income/		Average
(Dollars in thousands)	Balance			Expense		Rate			Balance				Expense		Rate
Assets:
Interest-earning deposits with other banks	$	102,623		$	569	2.22	%		$	42,566			$	269	2.56	%
U.S. government obligations		17,315			73	1.69				20,039				82	1.66
Obligations of state and political subdivisions		59,267			507	3.43				64,167				546	3.45
Other debt and equity securities		394,840			2,572	2.61				385,990				2,631	2.76
Federal Home Loan Bank, Federal Reserve Bank and other stock		31,938			535	6.72				32,360				586	7.34
Total interest-earning deposits, investments and other interest-earning assets		605,983			4,256	2.82				545,122				4,114	3.06
Commercial, financial, and agricultural loans		820,009			10,589	5.18				811,071				10,758	5.38
Real estate—commercial and construction loans		1,912,248			23,110	4.85				1,822,276				21,559	4.80
Real estate—residential loans		941,712			11,483	4.89				938,299				11,412	4.93
Loans to individuals		31,939			510	6.40				32,524				518	6.46
Municipal loans and leases		335,399			3,305	3.95				332,299				3,221	3.93
Lease financings		81,762			1,459	7.16				80,893				1,435	7.19
Gross loans and leases		4,123,069			50,456	4.91				4,017,362				48,903	4.94
Total interest-earning assets		4,729,052			54,712	4.64				4,562,484				53,017	4.71
Cash and due from banks		46,868								44,714
Reserve for loan and lease losses		(31,847	)							(30,111	)
Premises and equipment, net		58,873								59,179
Operating lease right-of-use assets		35,821								37,129
Other assets		331,681								330,858
Total assets	$	5,170,448							$	5,004,253
Liabilities:
Interest-bearing checking deposits	$	457,231		$	457	0.40	%		$	478,927			$	714	0.60	%
Money market savings		982,440			4,234	1.73				918,487				3,748	1.65
Regular savings		818,523			1,013	0.50				789,033				814	0.42
Time deposits		688,897			3,407	1.98				655,303				2,927	1.81
Total time and interest-bearing deposits		2,947,091			9,111	1.24				2,841,750				8,203	1.17
Short-term borrowings		48,312			217	1.80				117,664				638	2.20
Long-term debt		159,572			836	2.10				145,299				739	2.06
Subordinated notes		94,663			1,261	5.34				94,603				1,261	5.41
Total borrowings		302,547			2,314	3.07				357,566				2,638	2.99
Total interest-bearing liabilities		3,249,638			11,425	1.41				3,199,316				10,841	1.37
Noninterest-bearing deposits		1,198,320								1,089,449
Operating lease liabilities		38,873								40,090
Accrued expenses and other liabilities		38,079								43,824
Total liabilities		4,524,910								4,372,679
Shareholders' Equity:
Common stock		157,784								157,784
Additional paid-in capital		293,496								292,746
Retained earnings and other equity		194,258								181,044
Total shareholders' equity		645,538								631,574
Total liabilities and shareholders' equity	$	5,170,448							$	5,004,253
Net interest income				$	43,287								$	42,176
Net interest spread						3.23									3.34
Effect of net interest-free funding sources						0.44									0.41
Net interest margin						3.67	%								3.75	%
Ratio of average interest-earning assets to average interest-bearing liabilities		145.53	%							142.61	%
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 June 30, 2019 and March 31, 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 June 30,
Tax Equivalent Basis				2019									2018
	Average			Income/		Average			Average				Income/		Average
(Dollars in thousands)	Balance			Expense		Rate			Balance				Expense		Rate
Assets:
Interest-earning deposits with other banks	$	102,623		$	569	2.22	%		$	37,254			$	148	1.59	%
U.S. government obligations		17,315			73	1.69				23,183				91	1.57
Obligations of state and political subdivisions		59,267			507	3.43				71,092				603	3.40
Other debt and equity securities		394,840			2,572	2.61				356,100				2,177	2.45
Federal Home Loan Bank, Federal Reserve Bank and other stock		31,938			535	6.72				32,788				509	6.23
Total interest-earning deposits, investments and other interest-earning assets		605,983			4,256	2.82				520,417				3,528	2.72
Commercial, financial, and agricultural loans		820,009			10,589	5.18				810,610				9,750	4.82
Real estate—commercial and construction loans		1,912,248			23,110	4.85				1,661,198				19,044	4.60
Real estate—residential loans		941,712			11,483	4.89				853,769				10,046	4.72
Loans to individuals		31,939			510	6.40				28,985				444	6.14
Municipal loans and leases		335,399			3,305	3.95				313,181				2,961	3.79
Lease financings		81,762			1,459	7.16				75,452				1,353	7.19
Gross loans and leases		4,123,069			50,456	4.91				3,743,195				43,598	4.67
Total interest-earning assets		4,729,052			54,712	4.64				4,263,612				47,126	4.43
Cash and due from banks		46,868								45,158
Reserve for loan and lease losses		(31,847	)							(23,914	)
Premises and equipment, net		58,873								61,234
Operating lease right-of-use assets		35,821								-
Other assets		331,681								336,737
Total assets	$	5,170,448							$	4,682,827
Liabilities:
Interest-bearing checking deposits	$	457,231		$	457	0.40	%		$	463,156			$	383	0.33	%
Money market savings		982,440			4,234	1.73				694,734				1,758	1.01
Regular savings		818,523			1,013	0.50				803,586				582	0.29
Time deposits		688,897			3,407	1.98				553,579				1,819	1.32
Total time and interest-bearing deposits		2,947,091			9,111	1.24				2,515,055				4,542	0.72
Short-term borrowings		48,312			217	1.80				217,327				958	1.77
Long-term debt		159,572			836	2.10				155,628				709	1.83
Subordinated notes		94,663			1,261	5.34				94,420				1,261	5.36
Total borrowings		302,547			2,314	3.07				467,375				2,928	2.51
Total interest-bearing liabilities		3,249,638			11,425	1.41				2,982,430				7,470	1.00
Noninterest-bearing deposits		1,198,320								1,048,901
Operating lease liabilities		38,873								-
Accrued expenses and other liabilities		38,079								39,829
Total liabilities		4,524,910								4,071,160
Shareholders' Equity:
Common stock		157,784								157,784
Additional paid-in capital		293,496								290,517
Retained earnings and other equity		194,258								163,366
Total shareholders' equity		645,538								611,667
Total liabilities and shareholders' equity	$	5,170,448							$	4,682,827
Net interest income				$	43,287								$	39,656
Net interest spread						3.23									3.43
Effect of net interest-free funding sources						0.44									0.30
Net interest margin						3.67	%								3.73	%
Ratio of average interest-earning assets to average interest-bearing liabilities		145.53	%							142.96	%
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 June 30, 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 Six Months Ended June 30,
Tax Equivalent Basis				2019									2018
	Average			Income/		Average			Average				Income/		Average
(Dollars in thousands)	Balance			Expense		Rate			Balance				Expense		Rate
Assets:
Interest-earning deposits with other banks	$	72,760		$	838	2.32	%		$	28,269			$	224	1.60	%
U.S. government obligations		18,669			155	1.67				23,550				185	1.58
Obligations of state and political subdivisions		61,703			1,053	3.44				72,814				1,196	3.31
Other debt and equity securities		390,440			5,203	2.69				357,766				4,272	2.41
Federal Home Loan Bank, Federal Reserve Bank and other stock		32,148			1,121	7.03				30,933				1,013	6.60
Total interest-earning deposits, investments and other interest-earning assets		575,720			8,370	2.93				513,332				6,890	2.71
Commercial, financial, and agricultural loans		815,565			21,347	5.28				796,483				18,650	4.72
Real estate—commercial and construction loans		1,867,510			44,669	4.82				1,630,964				36,662	4.53
Real estate—residential loans		940,015			22,895	4.91				845,677				19,721	4.70
Loans to individuals		32,230			1,028	6.43				28,475				857	6.07
Municipal loans and leases		333,858			6,526	3.94				312,470				5,853	3.78
Lease financings		81,330			2,894	7.18				75,083				2,697	7.24
Gross loans and leases		4,070,508			99,359	4.92				3,689,152				84,440	4.62
Total interest-earning assets		4,646,228			107,729	4.68				4,202,484				91,330	4.38
Cash and due from banks		45,797								43,839
Reserve for loan and lease losses		(30,984	)							(22,973	)
Premises and equipment, net		59,025								61,485
Operating lease right-of-use assets		36,472								-
Other assets		331,272								334,879
Total assets	$	5,087,810							$	4,619,714
Liabilities:
Interest-bearing checking deposits	$	468,019		$	1,171	0.50	%		$	444,197			$	675	0.31	%
Money market savings		950,641			7,982	1.69				676,651				3,101	0.92
Regular savings		803,859			1,827	0.46				818,895				1,139	0.28
Time deposits		672,193			6,334	1.90				547,562				3,318	1.22
Total time and interest-bearing deposits		2,894,712			17,314	1.21				2,487,305				8,233	0.67
Short-term borrowings		82,796			855	2.08				196,690				1,603	1.64
Long-term debt		152,475			1,575	2.08				155,697				1,374	1.78
Subordinated notes		94,633			2,522	5.37				94,390				2,522	5.39
Total borrowings		329,904			4,952	3.03				446,777				5,499	2.48
Total interest-bearing liabilities		3,224,616			22,266	1.39				2,934,082				13,732	0.94
Noninterest-bearing deposits		1,144,185								1,036,916
Operating lease liabilities		39,478								-
Accrued expenses and other liabilities		40,936								39,881
Total liabilities		4,449,215								4,010,879
Shareholders' Equity:
Common stock		157,784								157,784
Additional paid-in capital		293,123								290,363
Retained earnings and other equity		187,688								160,688
Total shareholders' equity		638,595								608,835
Total liabilities and shareholders' equity	$	5,087,810							$	4,619,714
Net interest income				$	85,463								$	77,598
Net interest spread						3.29									3.44
Effect of net interest-free funding sources						0.42									0.28
Net interest margin						3.71	%								3.72	%
Ratio of average interest-earning assets to average interest-bearing liabilities		144.09	%							143.23	%
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 six months ended June 30, 2019 and 2018 have been calculated using the Corporation’s federal applicable rate of 21.0%.

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

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