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 classTrading SymbolName of exchange on which registered
Common Stock, $5 par valueUVSPThe 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 2.02Results 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 5.02Departure 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 9.01Financial Statements and Exhibits
(a) Not applicable
(b) Not applicable
(c) Not applicable
(d) Exhibits
Exhibit No.  Description of Document
99.1  
104The 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  
104The cover page from the Corporation's Form 8-K, formatted in Inline XBRL



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)9/30/20236/30/20233/31/202312/31/20229/30/2022
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 equivalents290,341 140,411 138,324 152,799 113,310 
Investment securities held-to-maturity149,451 153,509 151,347 154,727 159,170 
Investment securities available for sale, net of allowance for credit losses334,538 356,164 367,656 350,256 347,479 
Investments in equity securities4,054 3,443 3,105 2,579 2,994 
Federal Home Loan Bank, Federal Reserve Bank and other stock, at cost42,417 42,811 43,792 33,841 29,475 
Loans held for sale16,473 29,526 5,425 5,037 9,087 
Loans and leases held for investment6,574,958 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 investment6,491,121 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 assets31,053 30,237 31,663 30,059 30,654 
Goodwill175,510 175,510 175,510 175,510 175,510 
Other intangibles, net of accumulated amortization11,079 10,923 11,044 11,384 11,650 
Bank owned life insurance130,522 129,715 128,926 120,297 120,035 
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 borrowings14,676 244,666 271,881 197,141 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 liabilities34,017 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 issued157,784 157,784 157,784 157,784 157,784 
Additional paid-in capital300,171 299,212 298,167 300,808 299,791 
Retained earnings464,634 453,806 443,493 428,637 410,942 
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’ equity807,198 805,222 798,496 776,500 754,187 
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)9/30/20236/30/20233/31/202312/31/20229/30/20229/30/20239/30/2022
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 losses506,341 518,995 515,880 505,717 517,335 513,704 518,383 
Loans and leases, gross6,537,169 6,372,342 6,164,890 5,979,581 5,752,119 6,359,498 5,540,624 
Deposits6,222,710 5,844,582 5,834,415 5,837,823 5,645,291 5,968,659 5,843,182 
Shareholders' equity811,515 806,709 789,153 767,192 773,099 802,541 772,951 


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)9/30/20236/30/20233/31/202312/31/20229/30/2022
Commercial, financial and agricultural$1,050,004 $1,039,265 $1,032,753 $1,088,928 $1,054,940 
Real estate-commercial3,275,140 3,221,993 3,128,210 3,027,955 2,936,204 
Real estate-construction427,561 413,404 376,569 381,811 329,915 
Real estate-residential secured for business purpose516,471 517,521 498,505 478,254 443,837 
Real estate-residential secured for personal purpose861,122 832,632 779,557 730,395 685,771 
Real estate-home equity secured for personal purpose176,855 175,090 172,073 176,699 175,843 
Loans to individuals27,331 25,544 28,656 27,873 26,679 
Lease financings240,474 236,789 223,481 211,315 196,070 
Total loans and leases held for investment, net of deferred income6,574,958 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)9/30/20236/30/20233/31/202312/31/20229/30/2022
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 due2,135 55 1,996 875 416 
Total nonperforming loans and leases20,220 15,142 13,358 14,228 14,036 
Other real estate owned19,916 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 investment0.28 %0.23 %0.18 %0.22 %0.23 %
Nonperforming loans and leases / Loans and leases held for investment0.31 %0.23 %0.21 %0.23 %0.24 %
Nonperforming assets / Total assets0.51 %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 investment1.28 %1.28 %1.28 %1.29 %1.28 %
Allowance for credit losses, loans and leases / Nonaccrual loans and leases463.57 %548.21 %704.40 %591.66 %550.14 %
Allowance for credit losses, loans and leases / Nonperforming loans and leases414.62 %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,
9/30/20236/30/20233/31/202312/31/20229/30/20229/30/20239/30/2022
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 leases0.06 %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:9/30/20236/30/20233/31/202312/31/20229/30/20229/30/20239/30/2022
Interest income$97,106 $90,139 $83,253 $77,401 $66,877 $270,498 $174,792 
Interest expense43,516 35,809 23,936 15,485 8,627 103,261 18,411 
Net interest income53,590 54,330 59,317 61,916 58,250 167,237 156,381 
Provision for credit losses2,024 3,428 3,387 5,416 3,558 8,839 6,782 
Net interest income after provision for credit losses51,566 50,902 55,930 56,500 54,692 158,398 149,599 
Noninterest income:
Trust fee income1,910 1,924 1,955 1,808 1,835 5,789 5,935 
Service charges on deposit accounts1,816 1,725 1,547 1,575 1,522 5,088 4,600 
Investment advisory commission and fee income4,843 4,708 4,752 5,585 4,199 14,303 14,163 
Insurance commission and fee income4,852 5,108 6,487 4,424 4,442 16,447 14,641 
Other service fee income3,020 3,318 3,076 3,236 3,124 9,414 9,189 
Bank owned life insurance income806 789 767 1,230 1,153 2,362 2,557 
Net gain on sales of investment securities— — — — — — 30 
Net gain on mortgage banking activities1,216 1,039 625 436 817 2,880 3,976 
Other income228 1,222 471 2,164 867 1,921 2,336 
Total noninterest income18,691 19,833 19,680 20,458 17,959 58,204 57,427 
Noninterest expense:
Salaries, benefits and commissions29,978 29,875 31,014 29,028 29,400 90,867 86,778 
Net occupancy2,594 2,614 2,727 2,551 2,504 7,935 7,642 
Equipment1,087 986 993 977 968 3,066 2,927 
Data processing4,189 4,137 4,029 4,039 3,901 12,355 11,176 
Professional fees1,763 1,669 1,941 1,829 2,521 5,373 7,503 
Marketing and advertising555 622 371 739 605 1,548 1,723 
Deposit insurance premiums1,258 1,116 1,101 708 662 3,475 2,367 
Intangible expenses220 253 253 301 309 726 992 
Restructuring charges— 1,330 — 184 — 1,330 — 
Other expense7,344 7,197 7,100 6,970 5,795 21,641 18,340 
Total noninterest expense48,988 49,799 49,529 47,326 46,665 148,316 139,448 
Income before taxes21,269 20,936 26,081 29,632 25,986 68,286 67,578 
Income tax expense4,253 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 outstanding29,479,066 29,439,392 29,312,265 29,251,293 29,290,829 29,410,852 29,440,228 
Period end shares outstanding29,508,128 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)9/30/20236/30/20233/31/202312/31/20229/30/20229/30/20239/30/2022
Return on average assets0.88 %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' equity8.32 %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 income36.4 %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 ratio9.43 %9.59 %9.71 %9.81 %9.87 %9.43 %9.87 %
Common equity tier 1 risk-based capital ratio10.32 %10.26 %10.43 %10.37 %10.51 %10.32 %10.51 %
Tier 1 risk-based capital ratio10.32 %10.26 %10.43 %10.37 %10.51 %10.32 %10.51 %
Total risk-based capital ratio13.58 %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 BasisSeptember 30, 2023June 30, 2023
AverageIncome/AverageAverageIncome/Average
(Dollars in thousands)BalanceExpenseRateBalanceExpenseRate
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 securities504,060 3,540 2.79 516,711 3,512 2.73 
Federal Home Loan Bank, Federal Reserve Bank and other stock40,406 712 6.99 43,783 781 7.15 
Total interest-earning deposits, investments and other interest-earning assets689,856 6,133 3.53 609,675 4,820 3.17 
Commercial, financial, and agricultural loans995,355 17,545 6.99 1,005,499 16,919 6.75 
Real estate—commercial and construction loans3,552,709 49,548 5.53 3,445,431 45,960 5.35 
Real estate—residential loans1,543,360 18,270 4.70 1,483,478 17,216 4.65 
Loans to individuals26,538 525 7.85 26,794 479 7.17 
Municipal loans and leases*234,685 2,430 4.11 234,940 2,388 4.08 
Lease financings184,522 2,928 6.30 176,200 2,659 6.05 
     Gross loans and leases6,537,169 91,246 5.54 6,372,342 85,621 5.39 
          Total interest-earning assets7,227,025 97,379 5.35 6,982,017 90,441 5.20 
Cash and due from banks62,673 58,675 
Allowance for credit losses, loans and leases(83,827)(81,641)
Premises and equipment, net52,071 52,540 
Operating lease right-of-use assets31,647 31,200 
Other assets404,394 398,007 
      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 savings1,645,210 17,850 4.30 1,460,899 14,089 3.87 
Regular savings828,672 861 0.41 888,680 845 0.38 
Time deposits1,140,622 11,668 4.06 823,665 7,141 3.48 
Total time and interest-bearing deposits4,684,567 37,082 3.14 4,185,133 27,467 2.63 
Short-term borrowings93,028 1,117 4.76 255,090 3,249 5.11 
Long-term debt320,000 3,036 3.76 301,593 2,811 3.74 
Subordinated notes148,568 2,281 6.09 148,443 2,282 6.17 
     Total borrowings561,596 6,434 4.55 705,126 8,342 4.75 
     Total interest-bearing liabilities5,246,163 43,516 3.29 4,890,259 35,809 2.94 
Noninterest-bearing deposits1,538,143 1,659,449 
Operating lease liabilities34,788 34,415 
Accrued expenses and other liabilities63,374 49,966 
     Total liabilities6,882,468 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 stock157,784 157,784 
Additional paid-in capital299,575 298,788 
Retained earnings and other equity354,156 350,137 
     Total shareholders' equity811,515 806,709 
     Total liabilities and shareholders' equity$7,693,983 $7,440,798 
Net interest income$53,863 $54,632 
Net interest spread2.06 2.26 
Effect of net interest-free funding sources0.90 0.88 
Net interest margin2.96 %3.14 %
Ratio of average interest-earning assets to average interest-bearing liabilities137.76 %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 Basis20232022
AverageIncome/AverageAverageIncome/Average
(Dollars in thousands)BalanceExpenseRateBalanceExpenseRate
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 securities504,060 3,540 2.79 514,462 3,010 2.32 
Federal Home Loan Bank, Federal Reserve Bank and other stock40,406 712 6.99 28,368 435 6.08 
Total interest-earning deposits, investments and other interest-earning assets689,856 6,133 3.53 595,179 3,718 2.48 
Commercial, financial, and agricultural loans995,355 17,545 6.99 981,303 12,036 4.87 
Real estate—commercial and construction loans3,552,709 49,548 5.53 3,105,821 34,100 4.36 
Real estate—residential loans1,543,360 18,270 4.70 1,256,509 12,492 3.94 
Loans to individuals26,538 525 7.85 27,197 381 5.56 
Municipal loans and leases*234,685 2,430 4.11 235,433 2,432 4.10 
Lease financings184,522 2,928 6.30 145,856 2,195 5.97 
     Gross loans and leases6,537,169 91,246 5.54 5,752,119 63,636 4.39 
          Total interest-earning assets7,227,025 97,379 5.35 6,347,298 67,354 4.21 
Cash and due from banks62,673 62,930 
Allowance for credit losses, loans and leases(83,827)(72,355)
Premises and equipment, net52,071 50,476 
Operating lease right-of-use assets31,647 30,740 
Other assets404,394 378,377 
      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 savings1,645,210 17,850 4.30 1,246,795 3,709 1.18 
Regular savings828,672 861 0.41 1,086,191 302 0.11 
Time deposits1,140,622 11,668 4.06 416,539 1,189 1.13 
Total time and interest-bearing deposits4,684,567 37,082 3.14 3,630,920 6,451 0.70 
Short-term borrowings93,028 1,117 4.76 104,453 524 1.99 
Long-term debt320,000 3,036 3.76 95,000 324 1.35 
Subordinated notes148,568 2,281 6.09 99,065 1,328 5.32 
     Total borrowings561,596 6,434 4.55 298,518 2,176 2.89 
     Total interest-bearing liabilities5,246,163 43,516 3.29 3,929,438 8,627 0.87 
Noninterest-bearing deposits1,538,143 2,014,371 
Operating lease liabilities34,788 33,786 
Accrued expenses and other liabilities63,374 46,772 
     Total liabilities6,882,468 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 stock157,784 157,784 
Additional paid-in capital299,575 299,135 
Retained earnings and other equity354,156 316,180 
     Total shareholders' equity811,515 773,099 
     Total liabilities and shareholders' equity$7,693,983 $6,797,466 
Net interest income$53,863 $58,727 
Net interest spread2.06 3.34 
Effect of net interest-free funding sources0.90 0.33 
Net interest margin2.96 %3.67 %
Ratio of average interest-earning assets to average interest-bearing liabilities137.76 %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 Basis20232022
AverageIncome/AverageAverageIncome/Average
(Dollars in thousands)BalanceExpenseRateBalanceExpenseRate
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 securities511,420 10,547 2.76 513,491 8,076 2.10 
Federal Home Loan Bank, Federal Reserve Bank and other stock39,664 2,102 7.09 27,239 1,134 5.57 
Total interest-earning deposits, investments and other interest-earning assets632,998 15,553 3.29 962,088 10,737 1.49 
Commercial, financial, and agricultural loans997,590 50,002 6.70 949,141 29,390 4.14 
Real estate—commercial and construction loans3,447,551 137,929 5.35 3,005,714 88,447 3.93 
Real estate—residential loans1,478,871 51,216 4.63 1,180,202 33,132 3.75 
Loans to individuals26,859 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 financings175,416 8,128 6.20 141,041 6,375 6.04 
     Gross loans and leases6,359,498 255,887 5.38 5,540,624 165,538 3.99 
          Total interest-earning assets6,992,496 271,440 5.19 6,502,712 176,275 3.62 
Cash and due from banks59,811 57,455 
Allowance for credit losses, loans and leases(81,829)(70,950)
Premises and equipment, net52,067 51,551 
Operating lease right-of-use assets31,384 30,453 
Other assets399,141 363,810 
      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 savings1,532,318 43,020 3.75 1,397,220 6,165 0.59 
Regular savings900,448 2,375 0.35 1,059,644 777 0.10 
Time deposits845,635 22,231 3.51 447,497 3,722 1.11 
Total time and interest-bearing deposits4,259,126 82,885 2.60 3,775,754 12,928 0.46 
Short-term borrowings195,606 7,094 4.85 46,765 537 1.54 
Long-term debt245,366 6,438 3.51 95,000 962 1.35 
Subordinated notes148,444 6,844 6.16 98,989 3,984 5.38 
     Total borrowings589,416 20,376 4.62 240,754 5,483 3.04 
     Total interest-bearing liabilities4,848,542 103,261 2.85 4,016,508 18,411 0.61 
Noninterest-bearing deposits1,709,533 2,067,428 
Operating lease liabilities34,548 33,514 
Accrued expenses and other liabilities57,906 44,630 
     Total liabilities6,650,529 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 stock157,784 157,784 
Additional paid-in capital299,550 298,784 
Retained earnings and other equity345,207 316,383 
     Total shareholders' equity802,541 772,951 
     Total liabilities and shareholders' equity$7,453,070 $6,935,031 
Net interest income$168,179 $157,864 
Net interest spread2.34 3.01 
Effect of net interest-free funding sources0.88 0.24 
Net interest margin3.22 %3.25 %
Ratio of average interest-earning assets to average interest-bearing liabilities144.22 %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 DescriptionTotal Outstanding Balance % of Commercial Loan Portfolio
CRE - Retail$466,862 8.9 %
Animal Production359,814 6.8 
CRE - Multi-family304,289 5.8 
CRE - Office301,949 5.7 
CRE - 1-4 Family Residential Investment282,333 5.4 
CRE - Industrial / Warehouse244,107 4.6 
Hotels & Motels (Accommodation)190,698 3.6 
Nursing and Residential Care Facilities173,781 3.3 
Specialty Trade Contractors164,837 3.1 
Education157,875 3.0 
Homebuilding (tract developers, remodelers)153,490 2.9 
Motor Vehicle and Parts Dealers134,118 2.5 
Merchant Wholesalers, Durable Goods125,105 2.4 
CRE - Mixed-Use - Residential109,187 2.1 
Crop Production101,973 1.9 
Repair and Maintenance94,011 1.8 
Private Equity & Special Purpose Entities (except 52592)86,549 1.6 
Administrative and Support Services86,053 1.6 
Rental and Leasing Services82,213 1.6 
Wood Product Manufacturing81,813 1.6 
Real Estate Lenders, Secondary Market Financing79,310 1.5 
CRE - Mixed-Use - Commercial75,797 1.4 
Religious Organizations, Advocacy Groups73,665 1.4 
Fabricated Metal Product Manufacturing71,827 1.4 
Personal and Laundry Services71,060 1.3 
Amusement, Gambling, and Recreation Industries70,759 1.3 
Merchant Wholesalers, Nondurable Goods69,919 1.3 
Miniwarehouse / Self-Storage65,069 1.2 
Food Services and Drinking Places63,662 1.2 
Food Manufacturing59,897 1.1 
Truck Transportation55,250 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 FinancingsTotal Outstanding Balance
Real Estate-Residential Secured for Personal Purpose$861,122 
Real Estate-Home Equity Secured for Personal Purpose176,855 
Loans to Individuals27,331 
Lease Financings240,474 
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)9/30/20236/30/20233/31/202312/31/20229/30/20229/30/20239/30/2022
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 tax174 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


v3.23.3
Cover
Oct. 25, 2023
Cover [Abstract]  
Document Type 8-K
Document Period End Date Oct. 25, 2023
Entity Registrant Name UNIVEST FINANCIAL CORPORATION
Entity Incorporation, State or Country Code PA
Entity File Number 0-7617
Entity Tax Identification Number 23-1886144
Entity Address, Address Line One 14 North Main Street
Entity Address, City or Town Souderton
Entity Address, State or Province PA
Entity Address, Postal Zip Code 18964
City Area Code 215
Local Phone Number 721-2400
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, $5 par value
Trading Symbol UVSP
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0000102212
Amendment Flag false
Univest Financial (NASDAQ:UVSP)
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