Univest Corporation of Pennsylvania -- Univest Bank and Trust Co. -- Reports First Quarter Earnings
http://media.marketwire.com/attachments/201207/62627_UNIVEST_preferred_hor_CMYK.jpghttp://at.marketwire.com/accesstracking/AccessTrackingLogServlet?PrId=1010416&ProfileId=051205&sourceType=1SOUDERTON, PA -- (Marketwired) -- 04/24/13 -- Univest Corporation of Pennsylvania ("Univest") (NASDAQ: UVSP), parent company of Univest Bank and Trust Co. and its insurance, investments and equipment financing subsidiaries, today announced financial results for the first quarter ended March 31, 2013. Univest reported net income of $5.4 million or $0.32 diluted earnings per share for the quarter ended March 31, 2013, a 3% increase in net income compared to $5.3 million or $0.31 diluted earnings per share for the quarter ended March 31, 2012.
Loans
Gross loans and leases increased $5.5 million from December 31, 2012 and $27.5 million from March 31, 2012. The growth in loans from the previous consecutive quarter occurred primarily in commercial loans, while the growth from the comparable quarter in the prior year occurred mainly in residential mortgages and equipment financing. While Univest continued to see increased loan activity during 2013, overall credit demand and utilization of lines by businesses and consumers remained light as a result of the sluggish economy.
Deposits
Total deposits grew $84.6 million from March 31, 2012, primarily due to an increase in demand deposits and new customers choosing Univest. Total deposits declined $50.7 million from December 31, 2012, mainly due to a decrease in public fund deposits of $38.9 million.
Net Interest Income and Margin
Net interest income decreased $221 thousand or 1% to $17.9 million in the first quarter of 2013 compared to the first quarter of 2012. The net interest margin on a tax-equivalent basis for the first quarter of 2013 was 3.83%, compared to 3.80% during the fourth quarter of 2012 and 3.95% in the first quarter of 2012.
The declines in net interest income and net interest margin during the first quarter of 2013 from the comparable period in the prior year were primarily due to the re-investment of maturing and called investment securities into lower yielding investments as a result of the lower interest rate environment and lower rates on commercial and residential real estate loans due to re-pricing and competitive pressures. The declines in net interest income and net interest margin were partially offset by favorable re-pricing of savings accounts and certificates of deposit.
Non-Interest Income
Non-interest income for the quarter ended March 31, 2013 was $11.5 million, an increase of $454 thousand or 4% from the comparable period in the prior year. Insurance commission and fee income was up $451 thousand, primarily a result of the acquisition of Javers Group on May 31, 2012. Investment advisory commission and fee income was up $445 thousand, primarily due to a 16.3% increase in assets under supervision. The net gain on mortgage banking activities increased $424 thousand during the first quarter of 2013 over the same period in 2012 as refinance volume continues to be strong. Partially offsetting these favorable variances were proceeds from bank owned life insurance death benefits of $989 thousand recognized during the first quarter of 2012.
Non-Interest Expense
Non-interest expense for the first quarter of 2013 was $20.2 million, an increase of $1.4 million or 7% compared to the first quarter of 2012. Commission expense increased $693 thousand in the first quarter of 2013 compared to the same period in the prior year mainly related to increased production activity and revenues generated in our mortgage banking, equipment finance, investment and insurance businesses. During the first quarter of 2013, Univest implemented a company-wide restructuring plan which reduced staffing levels by 3.4% and included the announced closure and consolidation of our Silverdale financial service center, effective May 2013, into our Hilltown and Perkasie locations. As a result, Univest recorded severance and fixed asset retirement expenses of $437 thousand and $102 thousand, respectively. The restructuring involved strategic changes to ensure we are effectively managing costs, improving efficiencies and evolving the business to meet the needs of all of our stakeholders.
Asset Quality and Provision for Loan and Lease Losses
Non-accrual loans and leases, including non-accrual troubled debt restructured loans, decreased to $28.9 million at March 31, 2013 from $32.1 million at December 31, 2012 and $36.3 million at March 31, 2012. The decrease in non-accrual loans from December 31, 2012 was mainly due to the foreclosure of commercial loans for two borrower relationships totaling $1.7 million and loan charge-offs. Net loan and lease charge-offs were $1.6 million during the first quarter of 2013, down from $3.4 million for the first quarter of 2012.
Non-accrual loans and leases as a percentage of total loans and leases (held for investment and nonaccrual loans held for sale) were 1.94% at March 31, 2013, compared to 2.17% at December 31, 2012 and 2.48% at March 31, 2012. Other real estate owned was $3.6 million at March 31, 2013, compared to $1.6 million at December 31, 2012 and $5.0 million at March 31, 2012. The year-to-date increase was primarily due to the addition of commercial properties for $1.7 million, as previously discussed. Of the other real estate owned properties held at March 31, 2013, two locations with an associated carrying balance of $2.0 million are currently under agreements of sale.
The provision for loan and lease losses was $2.1 million for the first quarter of 2013, compared to $4.1 million for the quarter ended March 31, 2012. The decrease in the year-to-date provision was primarily the result of migration and resolution of loans through the loan workout process and a decrease in loss factors for commercial real estate loans. The allowance for loan and lease losses as a percentage of loans and leases held for investment was 1.70% at March 31, 2013, compared to 1.67% at December 31, 2012 and 2.10% at March 31, 2012. The allowance for loan and lease losses to nonaccrual loans and leases held for investment equaled 87.31% at March 31, 2013, compared to 77.01% at December 31, 2012 and 84.36% at March 31, 2012.
Capital
Univest continues to remain well-capitalized at March 31, 2013. Total risk-based capital at March 31, 2013 was 15.37%, well in excess of the regulatory minimum for well capitalized status of 10%.
During the quarter, Univest repurchased 61 thousand shares of common stock at a cost of $1.0 million under our Board approved stock repurchase program. Shares available for future repurchases under the plan totaled 481 thousand at March 31, 2013. Total shares outstanding at March 31, 2013 were 16,762,695.
Dividend
On February 27, 2013, Univest declared a quarterly cash dividend of $0.20 per share, payable on April 1, 2013. This represented a 4.70% annualized yield based on the closing price of Univest's stock on the date the dividend was paid.
About Univest Corporation of Pennsylvania
Headquartered in Souderton, Pa., Univest Corporation of Pennsylvania (www.univest.net) and its subsidiaries serve the financial needs of residents, businesses, and nonprofit organizations in Bucks, Chester, Montgomery and Lehigh counties. For more information on Univest Corporation of Pennsylvania and its subsidiaries, please visit 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 banking 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) a significant increase in competitive pressures among financial institutions; (2) changes in the interest rate environment that may reduce net interest margins; (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
March 31, 2013
(Dollars in
thousands)
Balance Sheet (Period
End) 03/31/13 12/31/12 09/30/12 06/30/12 03/31/12
---------- ---------- ---------- ---------- ----------
Assets $2,263,036 $2,304,841 $2,232,081 $2,188,727 $2,192,164
Investment securities 508,751 499,579 515,256 439,092 451,433
Loans held for sale 3,606 4,530 6,146 1,333 2,535
Loans and leases held
for investment,
gross 1,487,375 1,481,862 1,469,511 1,465,449 1,459,830
Allowance for loan
and lease losses 25,222 24,746 27,096 30,502 30,597
Loans and leases held
for investment, net 1,462,153 1,457,116 1,442,415 1,434,947 1,429,233
Total deposits 1,814,610 1,865,333 1,777,930 1,743,922 1,730,030
Noninterest-bearing
deposits 380,447 368,948 334,856 334,828 307,769
NOW, money market and
savings 1,127,643 1,164,874 1,101,147 1,052,217 1,029,145
Time deposits 306,520 331,511 341,927 356,877 393,116
Borrowings 124,895 117,276 132,920 121,878 144,208
Shareholders' equity 284,784 284,277 281,589 277,316 275,525
Balance Sheet
(Average) For the three months ended,
------------------------------------------------------
03/31/13 12/31/12 09/30/12 06/30/12 03/31/12
---------- ---------- ---------- ---------- ----------
Assets $2,233,147 $2,264,863 $2,214,283 $2,173,698 $2,180,451
Investment securities 497,032 499,017 474,523 450,482 457,511
Loans and leases,
gross 1,484,043 1,478,156 1,465,897 1,460,275 1,457,320
Deposits 1,790,108 1,823,707 1,771,454 1,726,441 1,724,310
Shareholders' equity 285,558 286,980 280,172 277,621 275,071
Asset Quality Data
(Period End)
03/31/13 12/31/12 09/30/12 06/30/12 03/31/12
---------- ---------- ---------- ---------- ----------
Nonaccrual loans and
leases, including
nonaccrual troubled
debt restructured
loans and leases and
nonaccrual loans
held for sale $ 28,887 $ 32,132 $ 30,525 $ 36,762 $ 36,270
Accruing loans and
leases 90 days or
more past due 366 441 690 384 523
Accruing troubled
debt restructured
loans and leases 13,037 13,457 13,383 7,591 7,301
Other real estate
owned 3,616 1,607 3,301 3,922 4,993
Nonperforming assets 45,906 47,637 47,899 48,659 49,087
Allowance for loan
and lease losses 25,222 24,746 27,096 30,502 30,597
Nonaccrual loans and
leases / Loans and
leases held for
investment and
nonaccrual loans
held for sale 1.94% 2.17% 2.07% 2.51% 2.48%
Nonperforming loans
and leases / Loans
and leases held for
investment and
nonaccrual loans
held for sale 2.84% 3.11% 3.03% 3.05% 3.02%
Allowance for loan
and lease losses /
Loans and leases
held for investment 1.70% 1.67% 1.84% 2.08% 2.10%
Allowance for loan
and lease losses /
Nonaccrual loans and
leases held for
investment 87.31% 77.01% 97.03% 82.97% 84.36%
Allowance for loan
and lease losses /
Nonperforming loans
and leases held for
investment 59.64% 53.76% 64.52% 68.18% 69.39%
For the three months ended,
------------------------------------------------------
03/31/13 12/31/12 09/30/12 06/30/12 03/31/12
---------- ---------- ---------- ---------- ----------
Net loan and lease
charge-offs $ 1,598 $ 4,732 $ 5,616 $ 1,438 $ 3,373
Net loan and lease
charge-offs
(annualized)/Average
loans and leases 0.44% 1.27% 1.52% 0.40% 0.93%
Univest Corporation of Pennsylvania
Consolidated Selected Financial Data
March 31, 2013
(Dollars in
thousands, except
per share data)
For the three months ended,
------------------------------------------------------
For the period: 03/31/13 12/31/12 09/30/12 06/30/12 03/31/12
---------- ---------- ---------- ---------- ----------
Interest income $ 19,489 $ 19,988 $ 19,977 $ 20,258 $ 20,431
Interest expense 1,546 1,838 1,958 2,111 2,267
---------- ---------- ---------- ---------- ----------
Net interest income 17,943 18,150 18,019 18,147 18,164
Provision for loan
and lease losses 2,074 2,382 2,210 1,343 4,100
---------- ---------- ---------- ---------- ----------
Net interest income
after provision 15,869 15,768 15,809 16,804 14,064
Noninterest income:
Trust fee income 1,734 1,902 1,625 1,625 1,625
Service charges on
deposit accounts 1,086 1,128 1,122 1,079 1,100
Investment advisory
commission and fee
income 1,701 1,407 1,350 1,350 1,256
Insurance
commission and fee
income 2,718 2,078 2,129 2,057 2,267
Bank owned life
insurance income 504 365 463 336 1,506
Other-than-
temporary
impairment - - (4) (6) (3)
Net gain on sales
of investment
securities 185 14 9 24 258
Net gain on
mortgage banking
activities 1,696 1,571 2,171 1,074 1,272
Other income 1,851 1,913 1,996 461 1,740
---------- ---------- ---------- ---------- ----------
Total noninterest
income 11,475 10,378 10,861 8,000 11,021
Noninterest expense
Salaries and
benefits 9,860 9,121 8,944 9,100 10,141
Commissions 2,115 2,042 1,884 1,633 1,422
Premises and
equipment 2,581 2,664 2,597 2,513 2,428
Deposit insurance
premiums 392 410 406 429 444
Restructuring
charges 539 - - - -
Other expense 4,749 5,475 5,227 4,961 4,441
---------- ---------- ---------- ---------- ----------
Total noninterest
expense 20,236 19,712 19,058 18,636 18,876
---------- ---------- ---------- ---------- ----------
Income before taxes 7,108 6,434 7,612 6,168 6,209
Income taxes 1,710 1,358 1,842 1,405 946
---------- ---------- ---------- ---------- ----------
Net income $ 5,398 $ 5,076 $ 5,770 $ 4,763 $ 5,263
========== ========== ========== ========== ==========
Per Common Share
Data:
Book value per share $ 16.99 $ 16.95 $ 16.80 $ 16.55 $ 16.42
Net income per share:
Basic $ 0.32 $ 0.30 $ 0.34 $ 0.28 $ 0.31
Diluted $ 0.32 $ 0.30 $ 0.34 $ 0.28 $ 0.31
Dividends declared
per share $ 0.20 $ 0.20 $ 0.20 $ 0.20 $ 0.20
Weighted average
shares outstanding 16,788,152 16,765,199 16,760,080 16,770,290 16,749,134
Period end shares
outstanding 16,762,695 16,770,232 16,765,126 16,759,893 16,780,416
Univest Corporation of Pennsylvania
Consolidated Selected Financial Data
March 31, 2013
For the three months ended,
------------------------------------------------------
Profitability Ratios
(annualized) 03/31/13 12/31/12 09/30/12 06/30/12 03/31/12
---------- ---------- ---------- ---------- ----------
Return on average
assets 0.98% 0.89% 1.04% 0.88% 0.97%
Return on average
shareholders' equity 7.67% 7.04% 8.19% 6.90% 7.70%
Net interest margin
(FTE) 3.83% 3.80% 3.84% 3.97% 3.95%
Efficiency ratio (1) 65.61% 65.93% 62.84% 67.59% 60.46%
Capitalization Ratios
Dividends declared to
net income 62.21% 66.06% 58.09% 70.48% 63.63%
Shareholders' equity
to assets (Period
End) 12.58% 12.33% 12.62% 12.67% 12.57%
Tangible common
equity to tangible
assets 10.08% 9.88% 10.12% 10.11% 10.18%
Regulatory Capital
Ratios (Period End)
Tier 1 leverage ratio 11.71% 11.47% 11.48% 11.57% 11.64%
Tier 1 risk-based
capital ratio 14.10% 14.35% 14.07% 14.38% 14.50%
Total risk-based
capital ratio 15.37% 15.62% 15.34% 15.64% 15.76%
(1) Total operating expenses to net interest income before loan loss
provision plus non-interest income adjusted for tax equivalent income.
Distribution of Assets, Liabilities and Shareholders' Equity: Interest Rates
and Interest Differential
----------------------------------------------------------------------------
For the Three Months Ended March 31,
-------------------------------------------------------
Tax Equivalent Basis 2013 2012
--------------------------- ---------------------------
Average Income/ Average Average Income/ Average
Balance Expense Rate Balance Expense Rate
----------- ------- ------- ----------- ------- -------
Assets:
Interest-earning
deposits with other
banks $ 40,552 $ 35 0.35% $ 59,453 $ 38 0.26%
U.S. Government
obligations 174,408 477 1.11 147,146 519 1.42
Obligations of state
and political
subdivisions 121,686 1,579 5.26 116,918 1,708 5.88
Other debt and
equity securities 200,938 895 1.81 193,447 1,234 2.57
---------- ------- ---------- -------
Total interest-
earning deposits
and investments 537,584 2,986 2.25 516,964 3,499 2.72
---------- ------- ---------- -------
Commercial,
financial, and
agricultural loans 438,434 4,676 4.33 440,906 4,742 4.33
Real estate-
commercial and
construction loans 544,865 6,658 4.96 534,079 6,988 5.26
Real estate-
residential loans 257,435 2,455 3.87 247,295 2,605 4.24
Loans to individuals 42,781 596 5.65 44,497 630 5.69
Municipal loans and
leases 134,450 1,716 5.18 133,896 1,821 5.47
Lease financings 66,078 1,557 9.56 56,647 1,372 9.74
---------- ------- ---------- -------
Gross loans and
leases 1,484,043 17,658 4.83 1,457,320 18,158 5.01
---------- ------- ---------- -------
Total interest-
earning assets 2,021,627 20,644 4.14 1,974,284 21,657 4.41
---------- ------- ---------- -------
Cash and due from
banks 40,070 34,956
Reserve for loan and
lease losses (25,245) (31,908)
Premises and
equipment, net 33,046 34,299
Other assets 163,649 168,820
---------- ----------
Total assets $2,233,147 $2,180,451
========== ==========
Liabilities:
Interest-bearing
checking deposits $ 244,089 $ 36 0.06 $ 220,360 $ 57 0.10
Money market savings 325,677 80 0.10 310,878 148 0.19
Regular savings 534,701 76 0.06 498,572 264 0.21
Time deposits 323,982 1,048 1.31 400,433 1,384 1.39
---------- ------- ---------- -------
Total time and
interest-bearing
deposits 1,428,449 1,240 0.35 1,430,243 1,853 0.52
---------- ------- ---------- -------
Short-term
borrowings 102,444 17 0.07 118,255 106 0.36
Long-term debt - - - 440 4 3.66
Subordinated notes
and capital
securities 20,982 289 5.59 22,486 304 5.44
---------- ------- ---------- -------
Total borrowings 123,426 306 1.01 141,181 414 1.18
---------- ------- ---------- -------
Total interest-
bearing
liabilities 1,551,875 1,546 0.40 1,571,424 2,267 0.58
---------- ------- ---------- -------
Demand deposits,
non-interest
bearing 361,659 294,067
Accrued expenses and
other liabilities 34,055 39,889
---------- ----------
Total liabilities 1,947,589 1,905,380
---------- ----------
Shareholders' Equity
Common stock 91,332 91,332
Additional paid-in
capital 64,721 61,402
Retained earnings
and other equity 129,505 122,337
---------- ----------
Total
shareholders'
equity 285,558 275,071
---------- ----------
Total liabilities
and shareholders'
equity $2,233,147 $2,180,451
========== ==========
Net interest income $19,098 $19,390
======= =======
Net interest spread 3.74 3.83
Effect of net
interest-free
funding sources 0.09 0.12%
------- -------
Net interest margin 3.83% 3.95
======= =======
Ratio of average
interest-earning
assets to average
interest-bearing
liabilities 130.27% 125.64%
========== ==========
Notes: For rate calculation purposes, average loan and lease categories
include 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 March 31, 2013 and
2012 have been calculated using the Corporation's federal applicable
rate of 35.0%.
CONTACT:
Mike Keim
UNIVEST CORPORATION OF PENNSYLVANIA
Chief Financial Officer
215-721-2511
keimm@univest.net