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0000102212FALSE00001022122023-10-252023-10-25

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 _______________________ 
FORM 8-K 
_______________________ 
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 25, 2023
 _______________________ 
UNIVEST FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
  
Pennsylvania   0-7617   23-1886144
(State or other jurisdiction   (Commission   (I.R.S. Employer
of incorporation)   File Number)   Identification No.)
14 North Main Street, Souderton, Pennsylvania 18964
(Address of principal executive office)(Zip Code)
Registrant’s telephone number, including area code (215) 721-2400
Not applicable
(Former name or former address, if changed since last report)
 _______________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2 (b) under the Exchange Act (17 CFR 240.14d-2 (b))
☐ Pre-commencement communications pursuant to Rule 13e-4 (c) under the Exchange Act (17 CFR 240.13e-4 (c))
Securities registered pursuant to Section 12(b) of the Act:
Title of class Trading Symbol Name of exchange on which registered
Common Stock, $5 par value UVSP The NASDAQ Stock Market
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicated by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨


Item 2.02 Results of Operations and Financial Condition
On October 25, 2023, Univest Financial Corporation (the “Corporation”), parent company of Univest Bank and Trust Co. (the "Bank"), issued a press release reporting 2023 third quarter earnings. A copy of this press release is attached to this Current Report on Form 8-K as Exhibit 99.1.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangement of Certain Officers.
On October 25, 2023, the Board of Directors of the Corporation appointed Anne Vazquez to serve as an Alternate Director of the Corporation, effective December 1, 2023, with a term expiring at the 2024 annual shareholders meeting.
Ms. Vazquez is currently a General Partner at NewSpring Capital, LLC and NewSpring Mezzanine Capital. Ms. Vazquez has served NewSpring Capital, LLC in various capacities since 2008, including serving on the board of various portfolio companies. Ms. Vazquez was previously a Senior Analyst on the Financial Analysis Compliance Team for a private equity and global asset management firm. Ms. Vazquez also held various positions for KPMG, LLP, including Senior Associate in the Assurance Practice. Ms. Vazquez currently serves on the Board of Trustees for Notre Dame Academy de Namur and Holy Child School at Rosemont. Ms. Vazquez also serves on the Board of Directors for Association of Corporate Growth Philadelphia Chapter. Ms. Vazquez holds a MSAT from Villanova University and a BS for the University of Rhode Island.
Item 9.01 Financial Statements and Exhibits
(a) Not applicable
(b) Not applicable
(c) Not applicable
(d) Exhibits
Exhibit No.    Description of Document
99.1   
104 The cover page from the Corporation's Form 8-K, formatted in Inline XBRL



SIGNATURE
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.
 
Univest Financial Corporation
By: /s/ Brian J. Richardson
Name: Brian J. Richardson
Title: Senior Executive Vice President,
Chief Financial Officer
October 26, 2023


EXHIBIT INDEX
 
Exhibit No.    Description of Document
99.1   
104 The cover page from the Corporation's Form 8-K, formatted in Inline XBRL


EX-99.1 2 exhibit991earningsrelease0.htm EX-99.1 Document

Exhibit 99.1
NEWS
logoa.jpg

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

FOR IMMEDIATE RELEASE

UNIVEST FINANCIAL CORPORATION REPORTS THIRD QUARTER RESULTS


SOUDERTON, Pa., October 25, 2023 - Univest Financial Corporation (“Univest” or the "Corporation") (NASDAQ: UVSP), parent company of Univest Bank and Trust Co. (the "Bank") and its insurance, investments and equipment financing subsidiaries, announced net income for the quarter ended September 30, 2023 was $17.0 million, or $0.58 diluted earnings per share, compared to net income of $20.8 million, or $0.71 diluted earnings per share, for the quarter ended September 30, 2022.

Loans
Gross loans and leases increased $112.7 million, or 1.7% (7.0% annualized), from June 30, 2023, primarily due to increases in commercial, commercial real estate, construction and residential mortgage loans. Gross loans and leases increased $451.7 million, or 7.4% (9.8% annualized), from December 31, 2022, primarily due to increases in commercial real estate, construction, residential mortgage loans and lease financings.
Deposits and Liquidity
Total deposits increased $451.8 million, or 7.5% (30.2% annualized), from June 30, 2023 and $525.6 million, or 8.9% (11.9% annualized), from December 31, 2022. The increase from June 30, 2023 was primarily due to seasonal increases in public funds partially offset by decreases in commercial and consumer deposits. The increase from December 31, 2022 was primarily due to increases in brokered deposits and seasonal public funds deposits partially offset by decreases in commercial and consumer deposits. Noninterest-bearing deposits represented 22.2% of total deposits at September 30, 2023, down from 26.4% at June 30, 2023. At September 30, 2023, unprotected deposits, which excludes insured accounts, internal accounts, and collateralized trust accounts, represented 20.8% of total deposits, down from 23.3% at June 30, 2023.


As of September 30, 2023, the Corporation had cash and cash equivalents totaling $290.3 million. The Corporation and its subsidiaries had committed borrowing capacity of $3.3 billion at September 30, 2023, of which $1.7 billion was available. The Corporation and its subsidiaries also maintained unused uncommitted funding sources from correspondent banks of $369.0 million at September 30, 2023. Future availability under these uncommitted funding sources is subject to the prerogatives of the granting banks and may be withdrawn at will.

Net Interest Income and Margin
Net interest income of $53.6 million for the three months ended September 30, 2023 decreased $740 thousand, or 1.4%, from the three months ended June 30, 2023, and $4.7 million, or 8.0%, from the three months ended September 30, 2022. The decrease in net interest income for both comparison periods was due to increases in the cost of funds and the average balance of interest-bearing liabilities, partially offset by an increase in the yield and average balance of interest-earning assets.

Net interest margin, on a tax-equivalent basis, was 2.96% for the third quarter of 2023, compared to 3.14% for the second quarter of 2023 and 3.67% for the third quarter of 2022. Excess liquidity reduced net interest margin by approximately four basis points for the quarter ended September 30, 2023, and approximately one basis point for the quarter ended September 30, 2022. Excess liquidity had no impact on the quarter ended June 30, 2023.

Noninterest Income
Noninterest income for the quarter ended September 30, 2023 was $18.7 million, an increase of $732 thousand, or 4.1%, compared to the third quarter of 2022.

Investment advisory commission and fee income increased $644 thousand, or 15.3%, for the quarter ended September 30, 2023, primarily due to new customer relationships and appreciation of assets under management, as a majority of investment advisory fees are billed based on the prior quarter-end assets under management balance. Insurance commission and fee income increased $410 thousand, or 9.2%, for the quarter ended September 30, 2023, primarily due to increased revenue from commercial lines. Net gain on mortgage banking activities increased $399 thousand, or 48.8%, for the quarter ended September 30, 2023, due to increased volume.

Bank owned life insurance ("BOLI") decreased $347 thousand, or 30.1%, for the quarter ended September 30, 2023, primarily due to a death benefit claim of $446 thousand received in the third quarter of 2022. Other income decreased $639 thousand, or 73.7%, for the quarter ended September 30, 2023, primarily due to a $412 thousand decrease in the gain on sale of Small Business Administration ("SBA") loans.


Noninterest Expense
Noninterest expense for the quarter ended September 30, 2023 was $49.0 million, an increase of $2.3 million, or 5.0%, compared to the third quarter of 2022.

Salaries, benefits and commissions increased $578 thousand, or 2.0%, for the quarter ended September 30, 2023. This increase reflects our expansion into Maryland and Western Pennsylvania and annual merit increases, increases in medical claims expense and decreases in compensation capitalized driven by lower loan production, offset by decreases due to the staff reduction that was announced during the second quarter and a reduction in incentive compensation due to decreased profitability.

Deposit insurance premiums increased $596 thousand, or 90.0%, for the quarter ended September 30, 2023, primarily driven by an increased industry-wide assessment rate and an increase in our assessment base.

Other expense increased $1.5 million, or 26.7%, for the quarter ended September 30, 2023, primarily due to increases in retirement plan costs of $527 thousand. Other increases included $324 thousand of loan processing and workout fees. Federal Home Loan Bank letter of credit fees increased by $138 thousand due to increased public fund deposits and related collateral costs.

Professional fees decreased $758 thousand, or 30.1%, for the quarter ended September 30, 2023, primarily due to consultant fees incurred in the third quarter of 2022 related to our digital transformation initiative.

Tax Provision
The effective income tax rate was 20.0% for the quarters ended September 30, 2023 and 2022. The effective tax rates for the three months ended September 30, 2023 and 2022 reflected the benefits of tax-exempt income from investments in municipal securities and loans and leases.

Asset Quality and Provision for Credit Losses
Nonperforming assets were $40.1 million at September 30, 2023, compared to $34.5 million at June 30, 2023 and $33.0 million at September 30, 2022. On October 16, 2023, a $5.8 million loan was sold at par. This loan was classified as nonperforming at September 30, 2023.

Net loan and lease charge-offs were $969 thousand for the three months ended September 30, 2023 compared to $512 thousand and $1.2 million for the three months ended June 30, 2023 and September 30, 2022, respectively.



The provision for credit losses was $2.0 million for the three months ended September 30, 2023 compared to $3.4 million and $3.6 million for the three months ended June 30, 2023 and September 30, 2022, respectively. The allowance for credit losses on loans and leases as a percentage of loans and leases held for investment was 1.28% at September 30, 2023, June 30, 2023 and September 30, 2022.

Dividend
On October 25, 2023, Univest declared a quarterly cash dividend of $0.21 per share to be paid on November 22, 2023 to shareholders of record as of November 8, 2023.

Conference Call
Univest will host a conference call to discuss third quarter 2023 results on Thursday, October 26, 2023 at 9:00 a.m. EST. Participants may preregister at https://www.netroadshow.com/events/login?show=05f2e363&confId=56351. The general public can access the call by dialing 1-833-470-1428; using Access Code 988711. A replay of the conference call will be available through November 23, 2023 by dialing 1-866-813-9403; using Access Code 428932.

About Univest Financial Corporation
Univest Financial Corporation (UVSP), including its wholly-owned subsidiary Univest Bank and Trust Co., Member FDIC, has approximately $7.8 billion in assets and $4.3 billion in assets under management and supervision through its Wealth Management lines of business at September 30, 2023. 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 and online at www.univest.net.  
# # #
This press release and the reports Univest files with the Securities and Exchange Commission often contain "forward-looking statements" relating to trends or factors affecting the financial services industry and, specifically, the financial condition and results of operations, business, prospects and strategies of Univest. These forward-looking statements involve certain risks and uncertainties in that there are a number of important factors that could cause Univest's future financial condition, results of operations, business, prospects or strategies to differ materially from those expressed or implied by the forward-looking statements. These factors include, but are not limited to: (1) competition; (2) inflation and/or changes in interest rates, which may adversely impact our margins and yields, reduce the fair value of our financial instruments, reduce our loan originations and/or lead to higher operating costs; (3) changes in asset quality, prepayment speeds, loan sale volumes, charge-offs and/or credit loss provisions; (4) changes in liquidity, including the size and composition of our deposit portfolio and the percentage of uninsured deposits in the portfolio; (5) changes in economic conditions nationally and in our market; (6) economic assumptions that may impact our allowance for credit losses calculation; (7) legislative, regulatory, accounting or tax changes; (8) technological issues that may adversely affect our operations or those of our customers; (9) changes in the securities markets; (10) the current or anticipated impact of military conflict, terrorism or other geopolitical events; (11) our ability to enter into new markets successfully and capitalize on growth opportunities and/or (12) risk factors mentioned in the reports and registration statements Univest files with the Securities and Exchange Commission.

(UVSP - ER)


Univest Financial Corporation
Consolidated Selected Financial Data (Unaudited)
September 30, 2023
(Dollars in thousands)
Balance Sheet (Period End) 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022
ASSETS
Cash and due from banks $ 68,900  $ 80,795  $ 71,215  $ 84,176  $ 65,859 
Interest-earning deposits with other banks 221,441  59,616  67,109  68,623  47,451 
Cash and cash equivalents 290,341  140,411  138,324  152,799  113,310 
Investment securities held-to-maturity 149,451  153,509  151,347  154,727  159,170 
Investment securities available for sale, net of allowance for credit losses 334,538  356,164  367,656  350,256  347,479 
Investments in equity securities 4,054  3,443  3,105  2,579  2,994 
Federal Home Loan Bank, Federal Reserve Bank and other stock, at cost 42,417  42,811  43,792  33,841  29,475 
Loans held for sale 16,473  29,526  5,425  5,037  9,087 
Loans and leases held for investment 6,574,958  6,462,238  6,239,804  6,123,230  5,849,259 
Less: Allowance for credit losses, loans and leases (83,837) (82,709) (80,034) (79,004) (74,929)
Net loans and leases held for investment 6,491,121  6,379,529  6,159,770  6,044,226  5,774,330 
Premises and equipment, net 51,287  52,058  52,334  50,939  50,533 
Operating lease right-of-use assets 31,053  30,237  31,663  30,059  30,654 
Goodwill 175,510  175,510  175,510  175,510  175,510 
Other intangibles, net of accumulated amortization 11,079  10,923  11,044  11,384  11,650 
Bank owned life insurance 130,522  129,715  128,926  120,297  120,035 
Accrued interest and other assets 100,220  96,314  90,095  90,362  83,170 
Total assets $ 7,828,066  $ 7,600,150  $ 7,358,991  $ 7,222,016  $ 6,907,397 
LIABILITIES
Noninterest-bearing deposits $ 1,432,559  $ 1,582,767  $ 1,799,225  $ 2,047,263  $ 1,968,422 
Interest-bearing deposits: 5,006,606  4,404,635  4,035,432  3,866,263  3,818,554 
Total deposits 6,439,165  5,987,402  5,834,657  5,913,526  5,786,976 
Short-term borrowings 14,676  244,666  271,881  197,141  80,711 
Long-term debt 320,000  320,000  220,000  95,000  95,000 
Subordinated notes 148,636  148,510  148,385  148,260  99,107 
Operating lease liabilities 34,017  33,428  34,846  33,153  33,718 
Accrued expenses and other liabilities 64,374  60,922  50,726  58,436  57,698 
Total liabilities 7,020,868  6,794,928  6,560,495  6,445,516  6,153,210 
SHAREHOLDERS' EQUITY
Common stock, $5 par value: 48,000,000 shares authorized and 31,556,799 shares issued 157,784  157,784  157,784  157,784  157,784 
Additional paid-in capital 300,171  299,212  298,167  300,808  299,791 
Retained earnings 464,634  453,806  443,493  428,637  410,942 
Accumulated other comprehensive loss, net of tax benefit (71,586) (61,034) (55,550) (62,104) (64,985)
Treasury stock, at cost (43,805) (44,546) (45,398) (48,625) (49,345)
Total shareholders’ equity 807,198  805,222  798,496  776,500  754,187 
Total liabilities and shareholders’ equity $ 7,828,066  $ 7,600,150  $ 7,358,991  $ 7,222,016  $ 6,907,397 
For the three months ended, For the nine months ended,
Balance Sheet (Average) 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 9/30/2023 9/30/2022
Assets $ 7,693,983  $ 7,440,798  $ 7,219,211  $ 7,019,381  $ 6,797,466  $ 7,453,070  $ 6,935,031 
Investment securities, net of allowance for credit losses 506,341  518,995  515,880  505,717  517,335  513,704  518,383 
Loans and leases, gross 6,537,169  6,372,342  6,164,890  5,979,581  5,752,119  6,359,498  5,540,624 
Deposits 6,222,710  5,844,582  5,834,415  5,837,823  5,645,291  5,968,659  5,843,182 
Shareholders' equity 811,515  806,709  789,153  767,192  773,099  802,541  772,951 


Univest Financial Corporation
Consolidated Summary of Loans by Type and Asset Quality Data (Unaudited)
September 30, 2023
(Dollars in thousands)
Summary of Major Loan and Lease Categories (Period End) 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022
Commercial, financial and agricultural $ 1,050,004  $ 1,039,265  $ 1,032,753  $ 1,088,928  $ 1,054,940 
Real estate-commercial 3,275,140  3,221,993  3,128,210  3,027,955  2,936,204 
Real estate-construction 427,561  413,404  376,569  381,811  329,915 
Real estate-residential secured for business purpose 516,471  517,521  498,505  478,254  443,837 
Real estate-residential secured for personal purpose 861,122  832,632  779,557  730,395  685,771 
Real estate-home equity secured for personal purpose 176,855  175,090  172,073  176,699  175,843 
Loans to individuals 27,331  25,544  28,656  27,873  26,679 
Lease financings 240,474  236,789  223,481  211,315  196,070 
Total loans and leases held for investment, net of deferred income 6,574,958  6,462,238  6,239,804  6,123,230  5,849,259 
Less: Allowance for credit losses, loans and leases (83,837) (82,709) (80,034) (79,004) (74,929)
Net loans and leases held for investment $ 6,491,121  $ 6,379,529  $ 6,159,770  $ 6,044,226  $ 5,774,330 
Asset Quality Data (Period End) 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022
Nonaccrual loans and leases, including nonaccrual loans held for sale* $ 18,085  $ 15,087  $ 11,362  $ 13,353  $ 13,620 
Accruing loans and leases 90 days or more past due 2,135  55  1,996  875  416 
Total nonperforming loans and leases 20,220  15,142  13,358  14,228  14,036 
Other real estate owned 19,916  19,345  19,000  19,258  18,960 
Total nonperforming assets $ 40,136  $ 34,487  $ 32,358  $ 33,486  $ 32,996 
Nonaccrual loans and leases / Loans and leases held for investment 0.28  % 0.23  % 0.18  % 0.22  % 0.23  %
Nonperforming loans and leases / Loans and leases held for investment 0.31  % 0.23  % 0.21  % 0.23  % 0.24  %
Nonperforming assets / Total assets 0.51  % 0.45  % 0.44  % 0.46  % 0.48  %
Allowance for credit losses, loans and leases $ 83,837  $ 82,709  $ 80,034  $ 79,004  $ 74,929 
Allowance for credit losses, loans and leases / Loans and leases held for investment 1.28  % 1.28  % 1.28  % 1.29  % 1.28  %
Allowance for credit losses, loans and leases / Nonaccrual loans and leases 463.57  % 548.21  % 704.40  % 591.66  % 550.14  %
Allowance for credit losses, loans and leases / Nonperforming loans and leases 414.62  % 546.22  % 599.15  % 555.27  % 533.83  %
*Includes a $5.8 million loan held for sale at September 30, 2023.
For the three months ended, For the nine months ended,
9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 9/30/2023 9/30/2022
Net loan and lease charge-offs $ 969  $ 512  $ 2,842  $ 908  $ 1,196  $ 4,323  $ 2,987 
Net loan and lease charge-offs (annualized)/Average loans and leases 0.06  % 0.03  % 0.19  % 0.06  % 0.08  % 0.09  % 0.07  %


Univest Financial Corporation
Consolidated Selected Financial Data (Unaudited)
September 30, 2023
(Dollars in thousands, except per share data)
For the three months ended, For the nine months ended,
For the period: 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 9/30/2023 9/30/2022
Interest income $ 97,106  $ 90,139  $ 83,253  $ 77,401  $ 66,877  $ 270,498  $ 174,792 
Interest expense 43,516  35,809  23,936  15,485  8,627  103,261  18,411 
Net interest income 53,590  54,330  59,317  61,916  58,250  167,237  156,381 
Provision for credit losses 2,024  3,428  3,387  5,416  3,558  8,839  6,782 
Net interest income after provision for credit losses 51,566  50,902  55,930  56,500  54,692  158,398  149,599 
Noninterest income:
Trust fee income 1,910  1,924  1,955  1,808  1,835  5,789  5,935 
Service charges on deposit accounts 1,816  1,725  1,547  1,575  1,522  5,088  4,600 
Investment advisory commission and fee income 4,843  4,708  4,752  5,585  4,199  14,303  14,163 
Insurance commission and fee income 4,852  5,108  6,487  4,424  4,442  16,447  14,641 
Other service fee income 3,020  3,318  3,076  3,236  3,124  9,414  9,189 
Bank owned life insurance income 806  789  767  1,230  1,153  2,362  2,557 
Net gain on sales of investment securities —  —  —  —  —  —  30 
Net gain on mortgage banking activities 1,216  1,039  625  436  817  2,880  3,976 
Other income 228  1,222  471  2,164  867  1,921  2,336 
Total noninterest income 18,691  19,833  19,680  20,458  17,959  58,204  57,427 
Noninterest expense:
Salaries, benefits and commissions 29,978  29,875  31,014  29,028  29,400  90,867  86,778 
Net occupancy 2,594  2,614  2,727  2,551  2,504  7,935  7,642 
Equipment 1,087  986  993  977  968  3,066  2,927 
Data processing 4,189  4,137  4,029  4,039  3,901  12,355  11,176 
Professional fees 1,763  1,669  1,941  1,829  2,521  5,373  7,503 
Marketing and advertising 555  622  371  739  605  1,548  1,723 
Deposit insurance premiums 1,258  1,116  1,101  708  662  3,475  2,367 
Intangible expenses 220  253  253  301  309  726  992 
Restructuring charges —  1,330  —  184  —  1,330  — 
Other expense 7,344  7,197  7,100  6,970  5,795  21,641  18,340 
Total noninterest expense 48,988  49,799  49,529  47,326  46,665  148,316  139,448 
Income before taxes 21,269  20,936  26,081  29,632  25,986  68,286  67,578 
Income tax expense 4,253  4,136  5,047  5,796  5,185  13,436  13,294 
Net income $ 17,016  $ 16,800  $ 21,034  $ 23,836  $ 20,801  $ 54,850  $ 54,284 
Net income per share:
Basic $ 0.58  $ 0.57  $ 0.72  $ 0.82  $ 0.71  $ 1.86  $ 1.85 
Diluted $ 0.58  $ 0.57  $ 0.71  $ 0.81  $ 0.71  $ 1.86  $ 1.84 
Dividends declared per share $ 0.21  $ 0.21  $ 0.21  $ 0.21  $ 0.21  $ 0.63  $ 0.62 
Weighted average shares outstanding 29,479,066  29,439,392  29,312,265  29,251,293  29,290,829  29,410,852  29,440,228 
Period end shares outstanding 29,508,128  29,471,124  29,427,696  29,271,915  29,242,451  29,508,128  29,242,451 



Univest Financial Corporation
Consolidated Selected Financial Data (Unaudited)
September 30, 2023
For the three months ended, For the nine months ended,
Profitability Ratios (annualized) 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 9/30/2023 9/30/2022
Return on average assets 0.88  % 0.91  % 1.18  % 1.35  % 1.21  % 0.98  % 1.05  %
Return on average assets, excluding restructuring charges (1) 0.88  % 0.96  % 1.18  % 1.36  % 1.21  % 1.00  % 1.05  %
Return on average shareholders' equity 8.32  % 8.35  % 10.81  % 12.33  % 10.67  % 9.14  % 9.39  %
Return on average shareholders' equity, excluding restructuring charges (1) 8.32  % 8.88  % 10.81  % 12.40  % 10.67  % 9.31  % 9.39  %
Return on average tangible common equity (1)(3) 10.77  % 10.85  % 14.11  % 16.23  % 14.06  % 11.87  % 12.40  %
Return on average tangible common equity, excluding restructuring charges (1)(3) 10.77  % 11.52  % 14.11  % 16.33  % 14.06  % 12.10  % 12.40  %
Net interest margin (FTE) 2.96  % 3.14  % 3.58  % 3.76  % 3.67  % 3.22  % 3.25  %
Efficiency ratio (2) 67.3  % 66.7  % 62.2  % 56.9  % 60.6  % 65.3  % 64.6  %
Efficiency ratio, excluding restructuring charges (1)(2) 67.3  % 64.9  % 62.2  % 56.7  % 60.6  % 64.7  % 64.6  %
Capitalization Ratios
Dividends declared to net income 36.4  % 36.8  % 29.2  % 25.8  % 29.6  % 33.8  % 33.6  %
Shareholders' equity to assets (Period End) 10.31  % 10.59  % 10.85  % 10.75  % 10.92  % 10.31  % 10.92  %
Tangible common equity to tangible assets (1) 8.22  % 8.45  % 8.63  % 8.49  % 8.55  % 8.22  % 8.55  %
Common equity book value per share $ 27.36  $ 27.32  $ 27.13  $ 26.53  $ 25.79  $ 27.36  $ 25.79 
Tangible common equity book value per share (1) $ 21.32  $ 21.27  $ 21.07  $ 20.42  $ 19.67  $ 21.32  $ 19.67 
Regulatory Capital Ratios (Period End)
Tier 1 leverage ratio 9.43  % 9.59  % 9.71  % 9.81  % 9.87  % 9.43  % 9.87  %
Common equity tier 1 risk-based capital ratio 10.32  % 10.26  % 10.43  % 10.37  % 10.51  % 10.32  % 10.51  %
Tier 1 risk-based capital ratio 10.32  % 10.26  % 10.43  % 10.37  % 10.51  % 10.32  % 10.51  %
Total risk-based capital ratio 13.58  % 13.54  % 13.78  % 13.67  % 13.10  % 13.58  % 13.10  %
(1) Non-GAAP metric. A reconciliation of this and other non-GAAP financial measures is included at the end of this document.
(2) Noninterest expense to net interest income before loan loss provision plus noninterest income adjusted for tax equivalent income.
(3) Net income before amortization of intangibles to average tangible common equity.



Univest Financial Corporation
Average Balances and Interest Rates (Unaudited)
For the Three Months Ended,
Tax Equivalent Basis September 30, 2023 June 30, 2023
Average Income/ Average Average Income/ Average
(Dollars in thousands) Balance Expense Rate Balance Expense Rate
Assets:
Interest-earning deposits with other banks $ 143,109  $ 1,865  5.17  % $ 46,897  $ 512  4.38  %
Obligations of state and political subdivisions* 2,281  16  2.78  2,284  15  2.63 
Other debt and equity securities 504,060  3,540  2.79  516,711  3,512  2.73 
Federal Home Loan Bank, Federal Reserve Bank and other stock 40,406  712  6.99  43,783  781  7.15 
Total interest-earning deposits, investments and other interest-earning assets 689,856  6,133  3.53  609,675  4,820  3.17 
Commercial, financial, and agricultural loans 995,355  17,545  6.99  1,005,499  16,919  6.75 
Real estate—commercial and construction loans 3,552,709  49,548  5.53  3,445,431  45,960  5.35 
Real estate—residential loans 1,543,360  18,270  4.70  1,483,478  17,216  4.65 
Loans to individuals 26,538  525  7.85  26,794  479  7.17 
Municipal loans and leases* 234,685  2,430  4.11  234,940  2,388  4.08 
Lease financings 184,522  2,928  6.30  176,200  2,659  6.05 
     Gross loans and leases 6,537,169  91,246  5.54  6,372,342  85,621  5.39 
          Total interest-earning assets 7,227,025  97,379  5.35  6,982,017  90,441  5.20 
Cash and due from banks 62,673  58,675 
Allowance for credit losses, loans and leases (83,827) (81,641)
Premises and equipment, net 52,071  52,540 
Operating lease right-of-use assets 31,647  31,200 
Other assets 404,394  398,007 
      Total assets $ 7,693,983  $ 7,440,798 
Liabilities:
Interest-bearing checking deposits $ 1,070,063  $ 6,703  2.49  % $ 1,011,889  $ 5,392  2.14  %
Money market savings 1,645,210  17,850  4.30  1,460,899  14,089  3.87 
Regular savings 828,672  861  0.41  888,680  845  0.38 
Time deposits 1,140,622  11,668  4.06  823,665  7,141  3.48 
Total time and interest-bearing deposits 4,684,567  37,082  3.14  4,185,133  27,467  2.63 
Short-term borrowings 93,028  1,117  4.76  255,090  3,249  5.11 
Long-term debt 320,000  3,036  3.76  301,593  2,811  3.74 
Subordinated notes 148,568  2,281  6.09  148,443  2,282  6.17 
     Total borrowings 561,596  6,434  4.55  705,126  8,342  4.75 
     Total interest-bearing liabilities 5,246,163  43,516  3.29  4,890,259  35,809  2.94 
Noninterest-bearing deposits 1,538,143  1,659,449 
Operating lease liabilities 34,788  34,415 
Accrued expenses and other liabilities 63,374  49,966 
     Total liabilities 6,882,468  6,634,089 
Total interest-bearing liabilities and noninterest-bearing deposits ("Cost of Funds") 6,784,306  2.54  6,549,708  2.19 
Shareholders' Equity:
Common stock 157,784  157,784 
Additional paid-in capital 299,575  298,788 
Retained earnings and other equity 354,156  350,137 
     Total shareholders' equity 811,515  806,709 
     Total liabilities and shareholders' equity $ 7,693,983  $ 7,440,798 
Net interest income $ 53,863  $ 54,632 
Net interest spread 2.06  2.26 
Effect of net interest-free funding sources 0.90  0.88 
Net interest margin 2.96  % 3.14  %
Ratio of average interest-earning assets to average interest-bearing liabilities 137.76  % 142.77  %
*Obligations of states and political subdivisions and municipal loans and leases are tax-exempt earning assets.
Notes: For rate calculation purposes, average loan and lease categories include deferred fees and costs and purchase accounting adjustment.
Net interest income includes net deferred costs amortization of $563 thousand and $668 thousand for the three months ended September 30, 2023 and June 30, 2023.
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 September 30, 2023 and June 30, 2023 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 September 30,
Tax Equivalent Basis 2023 2022
Average Income/ Average Average Income/ Average
(Dollars in thousands) Balance Expense Rate Balance Expense Rate
Assets:
Interest-earning deposits with other banks $ 143,109  $ 1,865  5.17  % $ 49,476  $ 252  2.02  %
U.S. government obligations —  —  —  565  3  2.11 
Obligations of state and political subdivisions* 2,281  16  2.78  2,308  18  3.09 
Other debt and equity securities 504,060  3,540  2.79  514,462  3,010  2.32 
Federal Home Loan Bank, Federal Reserve Bank and other stock 40,406  712  6.99  28,368  435  6.08 
Total interest-earning deposits, investments and other interest-earning assets 689,856  6,133  3.53  595,179  3,718  2.48 
Commercial, financial, and agricultural loans 995,355  17,545  6.99  981,303  12,036  4.87 
Real estate—commercial and construction loans 3,552,709  49,548  5.53  3,105,821  34,100  4.36 
Real estate—residential loans 1,543,360  18,270  4.70  1,256,509  12,492  3.94 
Loans to individuals 26,538  525  7.85  27,197  381  5.56 
Municipal loans and leases* 234,685  2,430  4.11  235,433  2,432  4.10 
Lease financings 184,522  2,928  6.30  145,856  2,195  5.97 
     Gross loans and leases 6,537,169  91,246  5.54  5,752,119  63,636  4.39 
          Total interest-earning assets 7,227,025  97,379  5.35  6,347,298  67,354  4.21 
Cash and due from banks 62,673  62,930 
Allowance for credit losses, loans and leases (83,827) (72,355)
Premises and equipment, net 52,071  50,476 
Operating lease right-of-use assets 31,647  30,740 
Other assets 404,394  378,377 
      Total assets $ 7,693,983  $ 6,797,466 
Liabilities:
Interest-bearing checking deposits $ 1,070,063  $ 6,703  2.49  % $ 881,395  $ 1,251  0.56  %
Money market savings 1,645,210  17,850  4.30  1,246,795  3,709  1.18 
Regular savings 828,672  861  0.41  1,086,191  302  0.11 
Time deposits 1,140,622  11,668  4.06  416,539  1,189  1.13 
Total time and interest-bearing deposits 4,684,567  37,082  3.14  3,630,920  6,451  0.70 
Short-term borrowings 93,028  1,117  4.76  104,453  524  1.99 
Long-term debt 320,000  3,036  3.76  95,000  324  1.35 
Subordinated notes 148,568  2,281  6.09  99,065  1,328  5.32 
     Total borrowings 561,596  6,434  4.55  298,518  2,176  2.89 
     Total interest-bearing liabilities 5,246,163  43,516  3.29  3,929,438  8,627  0.87 
Noninterest-bearing deposits 1,538,143  2,014,371 
Operating lease liabilities 34,788  33,786 
Accrued expenses and other liabilities 63,374  46,772 
     Total liabilities 6,882,468  6,024,367 
Total interest-bearing liabilities and noninterest-bearing deposits ("Cost of Funds") 6,784,306  2.54  5,943,809  0.58 
Shareholders' Equity:
Common stock 157,784  157,784 
Additional paid-in capital 299,575  299,135 
Retained earnings and other equity 354,156  316,180 
     Total shareholders' equity 811,515  773,099 
     Total liabilities and shareholders' equity $ 7,693,983  $ 6,797,466 
Net interest income $ 53,863  $ 58,727 
Net interest spread 2.06  3.34 
Effect of net interest-free funding sources 0.90  0.33 
Net interest margin 2.96  % 3.67  %
Ratio of average interest-earning assets to average interest-bearing liabilities 137.76  % 161.53  %
*Obligations of states and political subdivisions and municipal loans and leases are tax-exempt earning assets.
Notes: For rate calculation purposes, average loan and lease categories include deferred fees and costs and purchase accounting adjustments.
Net interest income includes net deferred costs amortization of $563 thousand and $498 thousand for the three months ended September 30, 2023 and 2022, respectively.
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 September 30, 2023 and 2022 have been calculated using the Corporation’s federal applicable rate of 21.0%.


Univest Financial Corporation
Average Balances and Interest Rates (Unaudited)
For the Nine Months Ended September 30,
Tax Equivalent Basis 2023 2022
Average Income/ Average Average Income/ Average
(Dollars in thousands) Balance Expense Rate Balance Expense Rate
Assets:
Interest-earning deposits with other banks $ 79,630  $ 2,856  4.80  % $ 416,466  $ 1,433  0.46  %
U.S. government obligations —  —  —  2,578  40  2.07 
Obligations of state and political subdivisions* 2,284  48  2.81  2,314  54  3.12 
Other debt and equity securities 511,420  10,547  2.76  513,491  8,076  2.10 
Federal Home Loan Bank, Federal Reserve Bank and other stock 39,664  2,102  7.09  27,239  1,134  5.57 
Total interest-earning deposits, investments and other interest-earning assets 632,998  15,553  3.29  962,088  10,737  1.49 
Commercial, financial, and agricultural loans 997,590  50,002  6.70  949,141  29,390  4.14 
Real estate—commercial and construction loans 3,447,551  137,929  5.35  3,005,714  88,447  3.93 
Real estate—residential loans 1,478,871  51,216  4.63  1,180,202  33,132  3.75 
Loans to individuals 26,859  1,453  7.23  26,598  924  4.64 
Municipal loans and leases* 233,211  7,159  4.10  237,928  7,270  4.09 
Lease financings 175,416  8,128  6.20  141,041  6,375  6.04 
     Gross loans and leases 6,359,498  255,887  5.38  5,540,624  165,538  3.99 
          Total interest-earning assets 6,992,496  271,440  5.19  6,502,712  176,275  3.62 
Cash and due from banks 59,811  57,455 
Allowance for credit losses, loans and leases (81,829) (70,950)
Premises and equipment, net 52,067  51,551 
Operating lease right-of-use assets 31,384  30,453 
Other assets 399,141  363,810 
      Total assets $ 7,453,070  $ 6,935,031 
Liabilities:
Interest-bearing checking deposits $ 980,725  $ 15,259  2.08  % $ 871,393  $ 2,264  0.35  %
Money market savings 1,532,318  43,020  3.75  1,397,220  6,165  0.59 
Regular savings 900,448  2,375  0.35  1,059,644  777  0.10 
Time deposits 845,635  22,231  3.51  447,497  3,722  1.11 
Total time and interest-bearing deposits 4,259,126  82,885  2.60  3,775,754  12,928  0.46 
Short-term borrowings 195,606  7,094  4.85  46,765  537  1.54 
Long-term debt 245,366  6,438  3.51  95,000  962  1.35 
Subordinated notes 148,444  6,844  6.16  98,989  3,984  5.38 
     Total borrowings 589,416  20,376  4.62  240,754  5,483  3.04 
     Total interest-bearing liabilities 4,848,542  103,261  2.85  4,016,508  18,411  0.61 
Noninterest-bearing deposits 1,709,533  2,067,428 
Operating lease liabilities 34,548  33,514 
Accrued expenses and other liabilities 57,906  44,630 
     Total liabilities 6,650,529  6,162,080 
Total interest-bearing liabilities and noninterest-bearing deposits ("Cost of Funds") 6,558,075  2.11  6,083,936  0.40 
Shareholders' Equity:
Common stock 157,784  157,784 
Additional paid-in capital 299,550  298,784 
Retained earnings and other equity 345,207  316,383 
     Total shareholders' equity 802,541  772,951 
     Total liabilities and shareholders' equity $ 7,453,070  $ 6,935,031 
Net interest income $ 168,179  $ 157,864 
Net interest spread 2.34  3.01 
Effect of net interest-free funding sources 0.88  0.24 
Net interest margin 3.22  % 3.25  %
Ratio of average interest-earning assets to average interest-bearing liabilities 144.22  % 161.90  %
*Obligations of states and political subdivisions and municipal loans and leases are tax-exempt earning assets.
Notes: For rate calculation purposes, average loan and lease categories include deferred fees and costs and purchase accounting adjustments.
Net interest income includes net deferred costs amortization of $1.7 million and $1.3 million for the nine months ended September 30, 2023 and 2022, respectively.
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 nine months ended September 30, 2023 and 2022 have been calculated using the Corporation’s federal applicable rate of 21.0%.


Univest Financial Corporation
Loan Portfolio Overview (Unaudited)
September 30, 2023
(Dollars in thousands)
Industry Description Total Outstanding Balance % of Commercial Loan Portfolio
CRE - Retail $ 466,862  8.9  %
Animal Production 359,814  6.8 
CRE - Multi-family 304,289  5.8 
CRE - Office 301,949  5.7 
CRE - 1-4 Family Residential Investment 282,333  5.4 
CRE - Industrial / Warehouse 244,107  4.6 
Hotels & Motels (Accommodation) 190,698  3.6 
Nursing and Residential Care Facilities 173,781  3.3 
Specialty Trade Contractors 164,837  3.1 
Education 157,875  3.0 
Homebuilding (tract developers, remodelers) 153,490  2.9 
Motor Vehicle and Parts Dealers 134,118  2.5 
Merchant Wholesalers, Durable Goods 125,105  2.4 
CRE - Mixed-Use - Residential 109,187  2.1 
Crop Production 101,973  1.9 
Repair and Maintenance 94,011  1.8 
Private Equity & Special Purpose Entities (except 52592) 86,549  1.6 
Administrative and Support Services 86,053  1.6 
Rental and Leasing Services 82,213  1.6 
Wood Product Manufacturing 81,813  1.6 
Real Estate Lenders, Secondary Market Financing 79,310  1.5 
CRE - Mixed-Use - Commercial 75,797  1.4 
Religious Organizations, Advocacy Groups 73,665  1.4 
Fabricated Metal Product Manufacturing 71,827  1.4 
Personal and Laundry Services 71,060  1.3 
Amusement, Gambling, and Recreation Industries 70,759  1.3 
Merchant Wholesalers, Nondurable Goods 69,919  1.3 
Miniwarehouse / Self-Storage 65,069  1.2 
Food Services and Drinking Places 63,662  1.2 
Food Manufacturing 59,897  1.1 
Truck Transportation 55,250  1.0 
Industries with >$50 million in outstandings $ 4,457,272  84.6  %
Industries with <$50 million in outstandings $ 811,904  15.4  %
Total Commercial Loans $ 5,269,176  100.0  %
Consumer Loans and Lease Financings Total Outstanding Balance
Real Estate-Residential Secured for Personal Purpose $ 861,122 
Real Estate-Home Equity Secured for Personal Purpose 176,855 
Loans to Individuals 27,331 
Lease Financings 240,474 
Total Consumer Loans and Lease Financings $ 1,305,782 
Total $ 6,574,958 


Univest Financial Corporation
Non-GAAP Reconciliation
September 30, 2023
Management uses 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 the table below for additional information on non-GAAP measures used throughout this earnings release.
As of or for the three months ended, As of or for the nine months ended,
(Dollars in thousands) 9/30/2023 6/30/2023 3/31/2023 12/31/2022 9/30/2022 9/30/2023 9/30/2022
Restructuring charges (a) $ —  $ 1,330  $ —  $ 184  $ —  $ 1,330  $ — 
Tax effect of restructuring charges —  (279) —  (39) —  (279) — 
Restructuring charges, net of tax $ —  $ 1,051  $ —  $ 145  $ —  $ 1,051  $ — 
Net income $ 17,016  $ 16,800  $ 21,034  $ 23,836  $ 20,801  $ 54,850  $ 54,284 
Amortization of intangibles, net of tax 174  200  200  238  244  574  784 
Net income before amortization of intangibles $ 17,190  $ 17,000  $ 21,234  $ 24,074  $ 21,045  $ 55,424  $ 55,068 
Shareholders' equity $ 807,198  $ 805,222  $ 798,496  $ 776,500  $ 754,187  $ 807,198  $ 754,187 
Goodwill (175,510) (175,510) (175,510) (175,510) (175,510) (175,510) (175,510)
Other intangibles (b) (2,558) (2,767) (3,054) (3,251) (3,485) (2,558) (3,485)
Tangible common equity $ 629,130  $ 626,945  $ 619,932  $ 597,739  $ 575,192  $ 629,130  $ 575,192 
Total assets $ 7,828,066  $ 7,600,150  $ 7,358,991  $ 7,222,016  $ 6,907,397  $ 7,828,066  $ 6,907,397 
Goodwill (175,510) (175,510) (175,510) (175,510) (175,510) (175,510) (175,510)
Other intangibles (b) (2,558) (2,767) (3,054) (3,251) (3,485) (2,558) (3,485)
Tangible assets $ 7,649,998  $ 7,421,873  $ 7,180,427  $ 7,043,255  $ 6,728,402  $ 7,649,998  $ 6,728,402 
Average shareholders' equity $ 811,515  $ 806,709  $ 789,153  $ 767,192  $ 773,099  $ 802,541  $ 772,951 
Average goodwill (175,510) (175,510) (175,510) (175,510) (175,510) (175,510) (175,510)
Average other intangibles (b) (2,680) (2,924) (3,137) (3,355) (3,550) (2,913) (3,808)
Average tangible common equity $ 633,325  $ 628,275  $ 610,506  $ 588,327  $ 594,039  $ 624,118  $ 593,633 
(a) Associated with financial service center optimization and headcount rationalization expense management strategies
(b) Amount does not include mortgage servicing rights