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Univest Corporation of Pennsylvania - Univest Bank and Trust Co. - Reports Second Quarter Results

/EIN News/ -- SOUDERTON, Pa., July 26, 2017 (GLOBE NEWSWIRE) -- Univest Corporation of Pennsylvania (“Univest” or the “Corporation”) (NASDAQ:UVSP), parent company of Univest Bank and Trust Co. ("Bank") and its insurance, investments and equipment financing subsidiaries, today announced financial results for the quarter ended June 30, 2017 of $11.8 million, or $0.44 diluted earnings per share, compared to net income of $5.2 million, or $0.27 diluted earnings per share, for the three months ended June 30, 2016. Net income for the six months ended June 30, 2017 was $22.6 million, or $0.85 diluted earnings per share, compared to net income of $12.5 million, or $0.64 diluted earnings per share, for the comparable period in the prior year. The financial results for the three and six months ended June 30, 2017 included a tax-free bank owned life insurance (“BOLI”) death benefit claim of $889 thousand, which represents $0.03 diluted earnings per share in each period. The financial results for the three and six months ended June 30, 2016 included acquisition and integration costs related to the acquisition of Fox Chase Bancorp (“Fox Chase”) of $1.2 million and $1.4 million, or $0.06 and $0.07 of diluted earnings per share net of tax, respectively. There were no acquisition and integration costs during the six months ended June 30, 2017.

Loans
Gross loans and leases increased $168.3 million, or 20.1% (annualized), from March 31, 2017 and $224.3 million, or 13.7% (annualized), from December 31, 2016. Gross loans and leases increased $1.2 billion, or 49.7%, from June 30, 2016, primarily due to the $776.2 million of loans acquired from Fox Chase. Organic loan growth, which excludes the loans acquired from Fox Chase at June 30, 2016, was $388.9 million, representing an increase of 12.5% from June 30, 2016 to June 30, 2017. The growth in loans in 2017 was primarily in commercial real estate, commercial business and residential real estate loans.

Deposits
Total deposits decreased $17.9 million, or 2.1% (annualized), from March 31, 2017 primarily due to a seasonal decrease in public funds deposits partially offset by increases in commercial customer deposits. Deposits increased $90.5 million, or 5.6% (annualized), from December 31, 2016 primarily due to growth in commercial customer deposits. Deposits grew $971.0 million, or 40.8%, from June 30, 2016 primarily due to $738.3 million of deposits acquired from Fox Chase. Organic deposits, which excludes the Fox Chase deposits at June 30, 2016, increased $232.7 million, or 7.5%, from June 30, 2016.

Net Interest Income and Margin
Net interest income of $35.3 million for the second quarter of 2017 increased $1.0 million, or 3.0%, from the first quarter of 2017 and increased $11.6 million, or 49.2%, from the second quarter of 2016. Net interest income of $69.6 million increased $22.4 million, or 47.5%, for the six months ended June 30, 2017 from the same period in the prior year. Net interest margin, on a tax-equivalent basis, was 3.76% for the second quarter of 2017, compared to 3.80% for the first quarter of 2017 and 3.81% for the fourth quarter of 2016. The favorable impact of purchase accounting accretion was 8 basis points ($742 thousand) for the quarter ended June 30, 2017 compared to 8 basis points ($764 thousand) for the quarter ended March 31, 2017 and 20 basis points ($1.8 million) for the quarter ended December 31, 2016. Excluding the impact of purchase accounting accretion, net interest margin was 3.68% for the quarter ended June 30, 2017 compared to 3.72% for the quarter ended March 31, 2017 and 3.61% for the quarter ended December 31, 2016. The increase in net interest income of $1.0 million for the second quarter of 2017 as compared to the first quarter of 2017 was due to a $106 million, or 11.1% (annualized), increase in average interest earning assets which was slightly offset by the decrease in net interest margin due to higher deposit and borrowing costs. A detailed analysis comparing net interest margin and net interest income for the quarter ended June 30, 2017 as compared to the quarter ended March 31, 2017 is included in the attached exhibits.

Noninterest Income
Noninterest income for the quarter ended June 30, 2017 was $16.0 million, an increase of $2.0 million, or 14.3%, from the second quarter of 2016. Noninterest income for the six months ended June 30, 2017 was $31.0 million, an increase of $3.1 million, or 11.3%, from the comparable period in the prior year. Service charges on deposits increased $257 thousand, or 24.3%, for the quarter and $502 thousand, or 24.4%, for the six months ended June 30, 2017, mostly due to fees on deposit accounts acquired from Fox Chase. Investment advisory commission and fee income increased $557 thousand, or 20.1%, for the quarter and $1.1 million, or 19.6%, for the six months ended June 30, 2017 primarily due to a combination of increased new customer relationships and favorable market performance during 2016 and the first half of 2017. BOLI income increased $1.1 million for the quarter and $1.4 million for the six months ended June 30, 2017, primarily due to proceeds from BOLI death benefits of $889 thousand recognized in the second quarter of 2017 and policies acquired from Fox Chase. Other income increased $529 thousand, or 26.3%, for the quarter and $840 thousand, or 20.9%, for the six months ended June 30, 2017, mainly due to an increase in other service fee income of $314 thousand for the quarter and $470 thousand for the six months ended June 30, 2017 and net gains on sales of other real estate owned of $121 thousand for the quarter and $235 thousand for the six months ended June 30, 2017. These increases were partially offset by a decrease in the net gain on sale of securities of $392 thousand for the quarter and $421 thousand for the six months ended June 30, 2017. In addition, the net gain on mortgage banking decreased $174 thousand, or 10.2%, for the quarter and $279 thousand, or 9.5%, for the six months ended June 30, 2017 primarily due to a decrease in mortgage volume.

Noninterest Expense
Noninterest expense for the quarter ended June 30, 2017 was $32.5 million, an increase of $3.0 million, or 10.2%, compared to the second quarter of 2016. Noninterest expense for the six months ended June 30, 2017 was $64.6 million, an increase of $8.1 million, or 14.3%, from the comparable period in the prior year. Salaries and benefit expense increased $2.3 million for the quarter and $4.7 million for the six months ended June 30, 2017, primarily attributable to higher staffing levels resulting from the Fox Chase acquisition, additional staff hired to support revenue generation across all business lines and the expansion into Lancaster County. Premises and equipment expenses increased $869 thousand for the quarter and $1.7 million for the six months ended June 30, 2017, primarily due to higher premises expense related to Fox Chase locations and expansion into Philadelphia, Lancaster County and the Lehigh Valley. Data processing expense increased $551 thousand for the quarter and $1.3 million for the six months ended June 30, 2017 due to increased investments in computer software and our outsourced data processing solution as well as the addition of Fox Chase processing expense. Other expense increased $732 thousand for the quarter and $1.8 million for the six months ended June 30, 2017 primarily due to inclusion of Fox Chase-related expenses and an increase of $289 thousand for the quarter and $705 thousand for the six months ended June 30, 2017 related to Bank shares tax as a result of a statutory rate increase in 2017 and the Corporation's growth primarily due to the Fox Chase acquisition. These increases were partially offset by acquisition and integration costs during 2016 related to the Fox Chase acquisition totaling $1.2 million for the quarter and $1.4 million for the six months ended June 30, 2016. There were no acquisition or integration costs during the three or six months ended June 30, 2017. In addition, intangible expense decreased $545 thousand for the quarter and $552 thousand for the six months ended June 30, 2017 as a result of the settlement of the Girard Partners Inc. acquisition earn-out in the fourth quarter of 2016 and the conclusion of the earn-out period for the Sterner Insurance Associates acquisition, which resulted in a reversal of a prior accrual of $303 thousand during the second quarter of 2017.

Asset Quality and Provision for Loan and Lease Losses
Non-accrual loans and leases, including non-accrual troubled debt restructured loans, were $20.2 million at June 30, 2017, compared to $17.9 million at December 31, 2016. Nonperforming assets were $34.4 million at June 30, 2017, compared to $27.1 million at December 31, 2016. During the second quarter of 2017, incremental balances of $8.8 million related to one borrower were classified as troubled debt restructurings as the related loans were granted amortization period extensions. Net loan and lease charge-offs were $1.4 million during the second quarter of 2017 and $1.8 million for the six months ended June 30, 2017. The provision for loan and lease losses was $2.8 million for the second quarter of 2017 and $5.2 million for the six months ended June 30, 2017. 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 0.73% at June 30, 2017, compared to 0.74% at March 31, 2017 and 0.73% at December 31, 2016.

Tax Provision  
The effective income tax rate was 26.4% for the quarter ended June 30, 2017, compared to 28.1% for the quarter ended June 30, 2016 and was 26.4% for the six months ended June 30, 2017, compared to 27.9% for the six months ended June 30, 2016. The effective income tax rate during the quarter and six months ended June 30, 2017 was impacted by the previously discussed BOLI death benefit of $889 thousand and by the adoption of ASU 2016-9. Excluding these two items, the effective income tax rate was 28.5% for the quarter and six months ended June 30, 2017, which reflects the impact of the Corporation's level of tax exempt income for the period relative to the overall level of taxable income.

Dividend
On May 22, 2017, Univest declared a quarterly cash dividend of $0.20 per share, payable on July 3, 2017. This represented a 2.64% 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 2017 results on Thursday, July 27, 2017 at 9:00 a.m. ET. Participants may preregister at http://dpregister.com/10109976. The general public can access the call by dialing 1-888-338-6515. A replay of the conference call will be available through August 27, 2017 by dialing 1-877-344-7529; using Conference ID: 10109976.

About Univest Corporation of Pennsylvania

Univest Corporation of Pennsylvania (UVSP), including its wholly-owned subsidiary Univest Bank and Trust Co., has approximately $4.5 billion in assets and $3.4 billion in assets under management and supervision through its Wealth Management lines of business at June 30, 2017. 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 Corporation of Pennsylvania and the reports Univest Corporation of Pennsylvania 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 Corporation of Pennsylvania. These forward-looking statements involve certain risks and uncertainties. There are a number of important factors that could cause Univest Corporation of Pennsylvania’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 Corporation of Pennsylvania is engaged; (6) technological issues which may adversely affect Univest Corporation of Pennsylvania’s financial operations or customers; (7) changes in the securities markets or (8) risk factors mentioned in the reports and registration statements Univest Corporation of Pennsylvania files with the Securities and Exchange Commission. Univest Corporation of Pennsylvania undertakes no obligation to revise these forward-looking statements or to reflect events or circumstances after the date of this press release.

 


Univest Corporation of Pennsylvania  
Consolidated Selected Financial Data  
June 30, 2017  
(Dollars in thousands)                              
                               
Balance Sheet (Period End)   06/30/17   03/31/17   12/31/16   09/30/16   06/30/16          
Assets   $ 4,453,527     $ 4,273,931     $ 4,230,528     $ 4,140,444     $ 3,107,617            
Investment securities     469,307       464,639       468,518       484,213       286,980            
Loans held for sale     2,259       1,110       5,890       3,844       4,657            
Loans and leases held for investment, gross     3,510,170       3,341,916       3,285,886       3,190,361       2,345,037            
Allowance for loan and lease losses     20,910       19,528       17,499       16,899       17,153            
Loans and leases held for investment, net     3,489,260       3,322,388       3,268,387       3,173,462       2,327,884            
Total deposits     3,348,080       3,365,951       3,257,567       3,178,509       2,377,084            
Noninterest-bearing deposits     963,790       947,495       918,337       874,581       689,916            
NOW, money market and savings     1,837,452       1,865,280       1,713,041       1,652,696       1,326,976            
Time deposits     546,838       553,176       626,189       651,232       360,192            
Borrowings     542,545       355,580       417,780       398,341       309,666            
Shareholders' equity     521,306       511,880       505,209       509,249       369,160            
                               
                               
Balance Sheet (Average)   For the three months ended,   For the six months ended,  
    06/30/17   03/31/17   12/31/16   09/30/16   06/30/16   06/30/17   06/30/16  
Assets   $ 4,333,689     $ 4,230,428     $ 4,134,976     $ 4,147,468     $ 2,854,561     $ 4,282,343     $ 2,844,277    
Investment securities     468,601       470,300       473,890       503,790       302,492       469,446       322,355    
Loans and leases, gross     3,401,325       3,306,877       3,208,171       3,164,273       2,239,674       3,354,361       2,208,382    
Deposits     3,346,409       3,290,285       3,237,778       3,177,060       2,340,959       3,318,502       2,346,387    
Shareholders' equity     517,697       509,055       507,832       506,464       368,466       513,399       366,280    
                               
                               
Asset Quality Data (Period End)                               
    06/30/17   03/31/17   12/31/16   09/30/16   06/30/16          
Nonaccrual loans and leases, including  nonaccrual troubled debt restructured                              
loans and leases   $ 20,174     $ 19,856     $ 17,916     $ 15,050     $ 13,265            
Accruing loans and leases 90 days or more past due     572       919       987       1,128       748            
Accruing troubled debt restructured loans and leases     11,470       2,818       3,252       3,286       4,413            
Total nonperforming loans and leases     32,216       23,593       22,155       19,464       18,426            
Other real estate owned     2,202       3,712       4,969       6,041       3,131            
Total nonperforming assets     34,418       27,305       27,124       25,505       21,557            
Nonaccrual loans and leases / Loans and leases held for investment     0.57 %     0.59 %     0.55 %     0.47 %     0.57 %          
Nonperforming loans and leases / Loans and leases held for investment     0.92 %     0.71 %     0.67 %     0.61 %     0.79 %          
Nonperforming assets / Total assets     0.77 %     0.64 %     0.64 %     0.62 %     0.69 %          
                               
Allowance for loan and lease losses     20,910       19,528       17,499       16,899       17,153            
Allowance for loan and lease losses/ Loans and leases held for investment     0.60 %     0.58 %     0.53 %     0.53 %     0.73 %          
Allowance for loan and lease losses / Loans and leases held for investment     0.73 %     0.74 %     0.73 %     0.77 %     0.82 %          
(excluding acquired loans at period-end)                              
Allowance for loan and lease losses / Nonaccrual loans and leases held for investment     103.65 %     98.35 %     97.67 %     112.29 %     129.31 %          
Allowance for loan and lease losses / Nonperforming loans and leases held for investment   64.91 %     82.77 %     78.98 %     86.82 %     93.09 %          
Acquired credit impaired loans   $ 6,485     $ 6,616     $ 7,352     $ 14,575     $ 942            
                               
    For the three months ended,   For the six months ended,  
    06/30/17   03/31/17   12/31/16   09/30/16   06/30/16   06/30/17   06/30/16  
Net loan and lease charge-offs   $ 1,384     $ 416     $ 1,650     $ 1,669     $ 129     $ 1,800     $ 1,631    
Net loan and lease charge-offs (annualized)/Average loans and leases     0.16 %     0.05 %     0.20 %     0.21 %     0.02 %     0.11 %     0.15 %  

 

Univest Corporation of Pennsylvania  
Consolidated Selected Financial Data  
June 30, 2017  
(Dollars in thousands, except per share data)                              
    For the three months ended,   For the six months ended,  
For the period:   06/30/17   03/31/17   12/31/16   09/30/16   06/30/16   06/30/17   06/30/16  
Interest income   $ 40,030   $ 38,396   $ 38,056   $ 36,705     $ 26,112   $ 78,426   $ 51,846  
Interest expense     4,730     4,113     3,884     3,836       2,451     8,843     4,662  
Net interest income     35,300     34,283     34,172     32,869       23,661     69,583     47,184  
Provision for loan and lease losses     2,766     2,445     2,250     1,415       830     5,211     1,156  
Net interest income after provision     32,534     31,838     31,922     31,454       22,831     64,372     46,028  
Noninterest income:                              
Trust fee income     2,016     1,907     1,921     1,958       1,997     3,923     3,862  
Service charges on deposit accounts     1,313     1,243     1,293     1,344       1,056     2,556     2,054  
Investment advisory commission and fee income     3,333     3,181     3,072     2,905       2,776     6,514     5,447  
Insurance commission and fee income     3,628     4,410     3,275     3,267       3,503     8,038     8,061  
Bank owned life insurance income     1,622     783     1,215     711       535     2,405     1,005  
Net gain on sales of investment securities     21     15     31     30       413     36     457  
Net gain on mortgage banking activities     1,537     1,113     1,092     2,006       1,711     2,650     2,929  
Other income     2,539     2,318     2,095     1,916       2,010     4,857     4,017  
Total noninterest income     16,009     14,970     13,994     14,137       14,001     30,979     27,832  
Noninterest expense:                              
Salaries and benefits     16,353     16,657     16,546     16,710       14,080     33,010     28,262  
Commissions     2,374     2,050     2,618     2,485       2,363     4,424     4,258  
Premises and equipment     3,715     3,658     3,929     3,476       2,846     7,373     5,722  
Data processing     2,081     2,058     2,001     2,169       1,530     4,139     2,811  
Professional fees     1,248     1,239     1,258     1,322       947     2,487     1,967  
Marketing and advertising     475     379     619     345       513     854     1,051  
Deposit insurance premiums     451     402     521     327       418     853     865  
Intangible expenses     446     759     2,917     854       991     1,205     1,757  
Acquisition-related costs     -     -     101     8,784       1,158     -     1,372  
Integration costs     -     -     269     5,365       27     -     33  
Restructuring charges (recoveries)     -     -     1,816     (85 )     -     -     -  
Other expense     5,405     4,828     5,835     5,314       4,673     10,233     8,387  
Total noninterest expense     32,548     32,030     38,430     47,066       29,546     64,578     56,485  
Income (loss) before taxes     15,995     14,778     7,486     (1,475 )     7,286     30,773     17,375  
Income tax expense (benefit)     4,217     3,922     568     (1,533 )     2,046     8,139     4,846  
Net income   $ 11,778   $ 10,856   $ 6,918   $ 58     $ 5,240   $ 22,634   $ 12,529  
Per common share data:                              
Book value per share   $ 19.55   $ 19.21   $ 19.00   $ 19.17     $ 18.88   $ 19.55   $ 18.88  
Net income per share:                              
Basic   $ 0.44   $ 0.41   $ 0.26   $ -     $ 0.27   $ 0.85   $ 0.64  
Diluted   $ 0.44   $ 0.41   $ 0.26   $ -     $ 0.27   $ 0.85   $ 0.64  
Dividends declared per share   $ 0.20   $ 0.20   $ 0.20   $ 0.20     $ 0.20   $ 0.40   $ 0.40  
Weighted average shares outstanding     26,661,784     26,630,698     26,577,948     26,554,626       19,603,310     26,646,327     19,590,873  
Period end shares outstanding     26,667,991     26,645,520     26,589,353     26,558,412       19,557,958     26,667,991     19,557,958  

 

Univest Corporation of Pennsylvania  
Consolidated Selected Financial Data  
June 30, 2017  
                                     
          For the three months ended,   For the six months ended,  
Profitability Ratios (annualized)     06/30/17   03/31/17   12/31/16   09/30/16   06/30/16   06/30/17   06/30/16  
                                     
Return on average assets       1.09 %     1.04 %     0.67 %     0.01 %     0.74 %     1.07 %     0.89 %  
Return on average assets, excluding integration   1.09 %     1.04 %     0.78 %     0.88 %     0.90 %     1.07 %     0.98 %  
and acquisition-related costs and restructuring charges (1), (2)                          
Return on average shareholders' equity     9.13 %     8.65 %     5.42 %     0.05 %     5.72 %     8.89 %     6.88 %  
Return on average shareholders' equity, excluding   9.13 %     8.65 %     6.37 %     7.24 %     6.99 %     8.89 %     7.64 %  
integration and acquisition-related costs and                              
restructuring charges (1), (2)                                
Return on average tangible common equity, excluding   14.06 %     13.48 %     9.95 %     11.32 %     10.31 %     13.77 %     11.31 %  
integration and acquisition-related costs and                              
restructuring charges (1), (2), (5)                                
Net interest margin (FTE)       3.76 %     3.80 %     3.81 %     3.68 %     3.93 %     3.78 %     3.92 %  
Efficiency ratio (3)         60.74 %     62.70 %     76.48 %     96.45 %     75.22 %     61.70 %     72.24 %  
Efficiency ratio, excluding integration and     60.74 %     62.70 %     72.13 %     67.63 %     72.20 %     61.70 %     70.44 %  
acquisition-related costs and restructuring charges (1), (3), (4)                          
                                     
Capitalization Ratios                                  
                                     
Dividends declared to net income       45.25 %     49.02 %     76.76 %     N/ M     74.64 %     47.06 %     62.41 %  
Shareholders' equity to assets (Period End)     11.71 %     11.98 %     11.94 %     12.30 %     11.88 %     11.71 %     11.88 %  
Tangible common equity to tangible assets (5)     7.96 %     8.06 %     7.97 %     8.24 %     8.39 %     7.96 %     8.39 %  
Tangible book value per share (5)     $ 12.75     $ 12.38     $ 12.13     $ 12.28     $ 12.82     $ 12.75     $ 12.82    
Tangible book value per share - Core (5), (6)   $ 12.87     $ 12.56     $ 12.32     $ 12.21     $ 12.72     $ 12.87     $ 12.72    
                                     
Regulatory Capital Ratios  (Period End)                               
Tier 1 leverage ratio         8.74 %     8.75 %     8.84 %     8.80 %     9.90 %     8.74 %     9.90 %  
Common equity tier 1 risk-based capital ratio     9.21 %     9.41 %     9.42 %     9.58 %     10.24 %     9.21 %     10.24 %  
Tier 1 risk-based capital ratio       9.21 %     9.41 %     9.42 %     9.58 %     10.24 %     9.21 %     10.24 %  
Total risk-based capital ratio       12.15 %     12.44 %     12.44 %     12.64 %     12.77 %     12.15 %     12.77 %  
                                     
                                     
(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 Corporation of Pennsylvania 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) Integration and acquisition-related costs and $ -     $ -     $ 2,186     $ 14,064     $ 1,185     $ -     $ 1,405    
  restructuring charges                            
  Tax effect on integration and acquisition-related   -       -       969       4,910       22       -       24    
  costs and restructuring charges                            
  (b) Integration and acquisition-related costs and $ -     $ -     $ 1,217     $ 9,154     $ 1,163     $ -     $ 1,381    
  restructuring charges, net of tax                            
                                     
(2 ) Net income in this ratio excludes integration and acquisition-related costs and 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 integration and acquisition-related costs and restructuring charges. See (1)(a) above.          
(5 ) Tangible equity represents total shareholders' equity less goodwill and other intangible assets, but includes servicing rights which were $6,548 at June 30, 2017, $6,502 at March 31, 2017, $6,485 at December 31, 2016, $6,167 at September 30, 2016 and $5,896 at June 30, 2016.          
(6 ) Tangible equity as defined in (5), excluding the impact of accumulated other comprehensive (loss) income on available-for-sale investment securities, net (($3,028) at June 30, 2017, ($4,726) at March 31, 2017, ($4,989) at December 31, 2016, $1,789 at September 30, 2016 and $1,907 at June 30, 2016), divided by total shares outstanding.        
N/M Not meaningful                                

 

Univest Corporation of Pennsylvania    
  Distribution of Assets, Liabilities and Shareholders' Equity: Interest Rates and Interest Differential     
    For the Three Months Ended,        
Tax Equivalent Basis June 30, 2017   March 31, 2017    
  Average Income/ Average   Average Income/ Average    
(Dollars in thousands) Balance Expense Rate   Balance Expense Rate    
Assets:                  
Interest-earning deposits with other banks $ 17,951   $ 39 0.87 % $ 8,592   $ 16 0.76 %  
U.S. government obligations   33,453     113 1.35     34,038     106 1.26    
Obligations of state and political subdivisions   83,356     886 4.26     85,854     922 4.36    
Other debt and equity securities   351,792     1,720 1.96     350,408     1,582 1.83    
Federal funds sold and other earning assets   29,860     396 5.32     25,909     358 5.60    
Total interest-earning deposits, investments,
federal funds sold and other earning assets
  516,412     3,154 2.45     504,801     2,984 2.40    
                   
Commercial, financial, and agricultural loans   761,544     8,172 4.30     721,050     7,841 4.41    
Real estate—commercial and construction loans   1,501,258     16,629 4.44     1,460,029     15,740 4.37    
Real estate—residential loans   750,149     8,479 4.53     738,211     8,236 4.52    
Loans to individuals   27,850     406 5.85     29,575     400 5.49    
Municipal loans and leases   283,129     3,185 4.51     279,379     3,120 4.53    
Lease financings   77,395     1,416 7.34     78,633     1,483 7.65    
Gross loans and leases   3,401,325     38,287 4.51     3,306,877     36,820 4.52    
Total interest-earning assets   3,917,737     41,441 4.24     3,811,678     39,804 4.24    
Cash and due from banks   43,804           41,942          
Reserve for loan and lease losses   (20,474 )         (18,200 )        
Premises and equipment, net   65,690           64,507          
Other assets   326,932           330,501          
Total assets $ 4,333,689         $ 4,230,428          
                   
Liabilities:                  
Interest-bearing checking deposits $ 445,830   $ 118 0.11   $ 426,373   $ 105 0.10    
Money market savings   560,350     694 0.50     531,658     563 0.43    
Regular savings   835,495     446 0.21     807,802     349 0.18    
Time deposits   547,115     1,203 0.88     591,813     1,174 0.80    
Total time and interest-bearing deposits   2,388,790     2,461 0.41     2,357,646     2,191 0.38    
                   
Short-term borrowings   139,146     325 0.94     150,155     262 0.71    
Long-term debt   200,207     683 1.37     148,031     399 1.09    
Subordinated notes   94,176     1,261 5.37     94,116     1,261 5.43    
Total borrowings   433,529     2,269 2.10     392,302     1,922 1.99    
Total interest-bearing liabilities   2,822,319     4,730 0.67     2,749,948     4,113 0.61    
Noninterest-bearing deposits   957,619           932,639          
Accrued expenses and other liabilities   36,054           38,786          
Total liabilities   3,815,992           3,721,373          
                   
Shareholders' Equity:                  
Common stock   144,559           144,559          
Additional paid-in capital   230,683           230,104          
Retained earnings and other equity   142,455           134,392          
Total shareholders' equity   517,697           509,055          
Total liabilities and shareholders' equity $ 4,333,689         $ 4,230,428          
Net interest income   $ 36,711       $ 35,691      
                   
Net interest spread     3.57       3.63    
Effect of net interest-free funding sources     0.19       0.17    
Net interest margin     3.76 %   3.80 %  
                 
Ratio of average interest-earning assets to average
interest-bearing liabilities
  138.81 %         138.61 %        
                   
Note 1: In the above schedule, the interest income and net interest income analysis contains tax-equivalent financial information
and measures determined by methods other than in accordance with U.S. GAAP. This financial information and measures 
should not be considered a substitute for GAAP basis financial information and measures. Management believes the presentation
of the non-GAAP financial information and measures provide useful information that is essential to a proper understanding of
the financial results of the Corporation.
Note 2:  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, 2017 and March 31, 2017 have been calculated      
using the Corporation’s federal applicable rate of 35.0%.                

 

Univest Corporation of Pennsylvania    
  Distribution of Assets, Liabilities and Shareholders' Equity: Interest Rates and Interest Differential     
    For the Three Months Ended June 30,        
Tax Equivalent Basis     2017         2016      
  Average Income/ Average   Average Income/ Average    
(Dollars in thousands) Balance Expense Rate   Balance Expense Rate    
Assets:                  
Interest-earning deposits with other banks $ 17,951   $ 39 0.87 % $ 7,654   $ 9 0.47 %  
U.S. government obligations   33,453     113 1.35     57,776     176 1.23    
Obligations of state and political subdivisions   83,356     886 4.26     101,241     1,092 4.34    
Other debt and equity securities   351,792     1,720 1.96     143,475     1,012 2.84    
Federal funds sold and other earning assets   29,860     396 5.32     11,018     120 4.38    
Total interest-earning deposits, investments,
federal funds sold and other earning assets
  516,412     3,154 2.45     321,164     2,409 3.02    
                   
Commercial, financial, and agricultural loans   761,544     8,172 4.30     436,189     4,132 3.81    
Real estate—commercial and construction loans   1,501,258     16,629 4.44     898,494     10,106 4.52    
Real estate—residential loans   750,149     8,479 4.53     557,733     6,141 4.43    
Loans to individuals   27,850     406 5.85     30,301     408 5.42    
Municipal loans and leases   283,129     3,185 4.51     241,507     2,723 4.53    
Lease financings   77,395     1,416 7.34     75,450     1,524 8.12    
Gross loans and leases   3,401,325     38,287 4.51     2,239,674     25,034 4.50    
Total interest-earning assets   3,917,737     41,441 4.24     2,560,838     27,443 4.31    
Cash and due from banks   43,804           32,647          
Reserve for loan and lease losses   (20,474 )         (16,789 )        
Premises and equipment, net   65,690           43,990          
Other assets   326,932           233,875          
Total assets $ 4,333,689         $ 2,854,561          
                   
Liabilities:                  
Interest-bearing checking deposits $ 445,830   $ 118 0.11   $ 351,011   $ 75 0.09    
Money market savings   560,350     694 0.50     337,250     322 0.38    
Regular savings   835,495     446 0.21     644,199     199 0.12    
Time deposits   547,115     1,203 0.88     374,936     862 0.92    
Total time and interest-bearing deposits   2,388,790     2,461 0.41     1,707,396     1,458 0.34    
                   
Short-term borrowings   139,146     325 0.94     53,874     320 2.39    
Long-term debt   200,207     683 1.37     -     - -    
Subordinated notes   94,176     1,261 5.37     49,431     673 5.48    
Total borrowings   433,529     2,269 2.10     103,305     993 3.87    
Total interest-bearing liabilities   2,822,319     4,730 0.67     1,810,701     2,451 0.54    
Noninterest-bearing deposits   957,619           633,563          
Accrued expenses and other liabilities   36,054           41,831          
Total liabilities   3,815,992           2,486,095          
                   
Shareholders' Equity:                  
Common stock   144,559           110,271          
Additional paid-in capital   230,683           121,070          
Retained earnings and other equity   142,455           137,125          
Total shareholders' equity   517,697           368,466          
Total liabilities and shareholders' equity $ 4,333,689         $ 2,854,561          
Net interest income   $ 36,711       $ 24,992      
                   
Net interest spread     3.57       3.77    
Effect of net interest-free funding sources     0.19       0.16    
Net interest margin     3.76 %   3.93 %  
Ratio of average interest-earning assets to average
interest-bearing liabilities
  138.81 %         141.43 %        
                   
Note 1: In the above schedule, the interest income and net interest income analysis contains tax-equivalent financial information      
and measures determined by methods other than in accordance with U.S. GAAP. This financial information and measures      
should not be considered a substitute for GAAP basis financial information and measures. Management believes the presentation      
of the non-GAAP financial information and measures provide useful information that is essential to a proper understanding of      
the financial results of the Corporation.      
                   
Note 2: 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, 2017 and 2016 have been calculated       
using the Corporation’s federal applicable rate of 35.0%.      
 

 

Univest Corporation of Pennsylvania    
  Distribution of Assets, Liabilities and Shareholders' Equity: Interest Rates and Interest Differential     
    For the Six Months Ended June 30,      
Tax Equivalent Basis     2017         2016      
  Average Income/ Average   Average Income/ Average    
(Dollars in thousands) Balance Expense Rate   Balance Expense Rate    
Assets:                  
Interest-earning deposits with other banks $   13,297   $ 55   0.83 % $   13,637   $   37   0.55 %  
U.S. government obligations     33,744       219   1.31       70,132       426   1.22    
Obligations of state and political subdivisions     84,598       1,808   4.31       101,151       2,221   4.42    
Other debt and equity securities     351,104       3,302   1.90       151,072       2,036   2.71    
Federal funds sold and other earning assets     27,896       754   5.45       12,919       252   3.92    
Total interest-earning deposits, investments,
federal funds sold and other earning assets
    510,639       6,138   2.42       348,911       4,972   2.87    
                   
Commercial, financial, and agricultural loans     741,409     16,013 4.36     424,094     8,146 3.86    
Real estate—commercial and construction loans   1,480,757     32,369 4.41     892,806     20,025   4.51    
Real estate—residential loans     744,213     16,715 4.53     549,855     12,117 4.43    
Loans to individuals     28,707       806   5.66       29,889       807   5.43    
Municipal loans and leases     281,264       6,305   4.52       236,503       5,348   4.55    
Lease financings     78,011       2,899   7.49       75,235       3,066   8.20    
  Gross loans and leases   3,354,361     75,107 4.52     2,208,382     49,509   4.51    
Total interest-earning assets   3,865,000     81,245 4.24     2,557,293     54,481 4.28    
Cash and due from banks     42,878             32,156          
Reserve for loan and lease losses     (19,344 )           (17,280 )        
Premises and equipment, net     65,102             43,431          
Other assets     328,707             228,677          
  Total assets $ 4,282,343         $ 2,844,277          
                   
Liabilities:                  
Interest-bearing checking deposits $   436,155   $ 223   0.10   $   376,586   $   159   0.08    
Money market savings     546,083       1,257   0.46       349,519       662   0.38    
Regular savings     821,725       795   0.20       635,546       373   0.12    
Time deposits     569,341       2,377   0.84       396,741       1,797   0.91    
  Total time and interest-bearing deposits   2,373,304     4,652   0.40     1,758,392       2,991   0.34    
                   
Short-term borrowings     144,620       587   0.82       40,631       323   1.60    
Long-term debt     174,263       1,082   1.25       -        -    -     
Subordinated notes     94,146       2,522   5.40       49,412       1,348   5.49    
  Total borrowings     413,029       4,191   2.05       90,043       1,671   3.73    
  Total interest-bearing liabilities   2,786,333     8,843 0.64     1,848,435       4,662   0.51    
Noninterest-bearing deposits     945,198             587,995          
Accrued expenses and other liabilities     37,413             41,567          
  Total liabilities   3,768,944           2,477,997          
                   
Shareholders' Equity:                  
Common stock     144,559             110,271          
Additional paid-in capital     230,395             120,947          
Retained earnings and other equity     138,445             135,062          
  Total shareholders' equity     513,399             366,280          
  Total liabilities and shareholders' equity $ 4,282,343         $ 2,844,277          
Net interest income   $ 72,402       $ 49,819      
                   
Net interest spread       3.60         3.77    
Effect of net interest-free funding sources       0.18         0.15    
Net interest margin       3.78 %       3.92 %  
Ratio of average interest-earning assets to average
interest-bearing liabilities 
  138.71 %         138.35 %        
                   
Note 1:  In the above schedule, the interest income and net interest income analysis contains tax-equivalent financial information      
  and measures determined by methods other than in accordance with U.S. GAAP. This financial information and measures       
  should not be considered a substitute for GAAP basis financial information and measures. Management believes the presentation    
  of the non-GAAP financial information and measures provide useful information that is essential to a proper understanding of       
  the financial results of the Corporation.                  
                   
Note 2: 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, 2017 and 2016 have been calculated           
using the Corporation’s federal applicable rate of 35.0%.                
                   
CONTACT: 	
                    Roger Deacon							 
                    UNIVEST CORPORATION OF PENNSYLVANIA
                    Chief Financial Officer
                    215-721-2455, DeaconR@univest.net

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