GlobeNewswire Inc | Jan 26, 2022 04:15PM EST

January 26, 2022

(Loan Growth of 9.4% for last twelve months (excluding PPP loans1))

SOUDERTON, Pa., Jan. 26, 2022 (GLOBE NEWSWIRE) -- 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, today announced net income for the year ended December31, 2021 of $91.8 million, or $3.11 diluted earnings per share, compared to net income of $46.9 million, or $1.60 diluted earnings per share, for the year ended December31, 2020. Net income for the quarter ended December31, 2021 was $17.4 million, or $0.59 diluted earnings per share, compared to net income of $25.9 million, or $0.88 diluted earnings per share, for the quarter ended December31, 2020.

Pre-tax pre-provision income1 for the year ended December31, 2021 was $104.2 million, an increase of $6.5 million, or 6.7%, from the prior year. Pre-tax pre-provision income1 for the quarter ended December31, 2021 was $23.4 million, an increase of $456 thousand, or 2.0%, from the fourth quarter of 2020.

AcquisitionOn December 1, 2021, Univest Insurance, LLC., the Bank's insurance subsidiary, completed the acquisition of the Paul I. Sheaffer Insurance Agency, a full-service firm providing insurance solutions to businesses and individuals in Central Pennsylvania.

Paycheck Protection Program As of December31, 2021, $31.7 million in PPP loans remain outstanding. During the fourth quarter, we recorded income of $1.6 million within net interest income related to these loans, of which $1.4 million was the result of recognition of associated net deferred loan fees upon forgiveness and pay downs of PPP loans totaling $55.4 million. During the year ended December31, 2021, we recorded income of $15.0 million within net interest income related to these loans, of which $10.4 million was the result of recognition of associated net deferred loan fees upon forgiveness and pay downs of PPP loans totaling $630.7 million. As of December31, 2021, we had $817 thousand of net deferred fees on our balance sheet, which represented approximately 4.5% of the initial deferred fee amount.

LoansGross loans and leases, excluding PPP loans1, increased $455.2 million, or 9.4%, from December31, 2020 due to increases in commercial, construction, commercial real estate, and residential mortgage loans and lease financings. Gross loans and leases, excluding PPP loans1, increased $111.8 million, or 8.7% (annualized), from September30, 2021 due to increases in construction, commercial real estate and commercial loans and lease financings. DepositsTotal deposits increased $812.4 million, or 15.5%, from December31, 2020, primarily due to increases in commercial, consumer and public funds deposits offset by a decrease in brokered deposits. Total deposits increased $117.0 million, or 7.9% (annualized), from September30, 2021, primarily due to increases in commercial and consumer deposits offset by a decrease in public funds deposits.

Net Interest Income and MarginNet interest income of $47.5 million for the three months ended December 31, 2021 increased $3.0 million, or 6.7%, from the three months ended December 31, 2020. The increase in net interest income for the three months ended December 31, 2021 compared to the same period of 2020 was primarily due to overall growth in loans, led by an increase in commercial real estate loan income of $2.2 million, and a $2.1 million decrease in the cost of interest-bearing liabilities offset by a decrease in PPP loan income of $1.6 million.

Net interest income of $188.4 million for the year ended December31, 2021 increased $14.0 million, or 8.0%, from the prior year. The increase in net interest income for the year ended December31, 2021 compared to 2020 was primarily due to an increase in PPP loan income of $7.0 million, an $8.2 million decrease in the cost of interest-bearing liabilities and growth in loans, primarily commercial real estate loans, partially offset by a decrease in loan yields, excluding PPP loans, and investment yields.

Net interest margin, on a tax-equivalent basis, was 2.86% for the fourth quarter of 2021, compared to 3.11% for the third quarter of 2021 and 3.02% for the fourth quarter of 2020. Excess liquidity reduced net interest margin by approximately 43 basis points for the quarter ended December31, 2021 compared to 27 basis points for the quarter ended September30, 2021 and 13 basis points for the quarter ended December31, 2020. This excess liquidity was primarily driven by strong growth of deposit balances since the beginning of the COVID-19 pandemic, primarily due to the various pandemic-related stimulus initiatives. PPP loans had a favorable impact on net interest margin of eight basis points for the quarter ended December31, 2021 compared to 20 basis points for the quarter ended September30, 2021 and an unfavorable impact of seven basis points for the quarter ended December31, 2020. As PPP loans are forgiven, the associated deferred fees are recognized in earnings, which occurred with greater frequency in 2021 as compared to 2020. Excluding the impact of excess liquidity and PPP loans, the net interest margin, on a tax-equivalent basis, was 3.21% for the quarter ended December31, 2021 compared to 3.18% for the quarter ended September 30, 2021 and 3.22% for the quarter ended December31, 2020.

Net interest margin, on a tax-equivalent basis, was 3.06% for the year ended December 31, 2021, compared to 3.16% for the year ended December 31, 2020. Excess liquidity reduced net interest margin by approximately 23 basis points for the year ended December31, 2021 compared to 14 basis points for the year ended December31, 2020. This excess liquidity was primarily driven by strong growth of deposit balances since the beginning of the COVID-19 pandemic, primarily due to the various pandemic-related stimulus initiatives. PPP loans had a favorable impact on net interest margin of 11 basis points for the year ended December31, 2021 compared to an unfavorable impact of seven basis points for the year ended December31, 2020. Excluding the impact of excess liquidity and PPP loans, the net interest margin, on a tax-equivalent basis, was 3.18% for the year ended December31, 2021 compared to 3.37% for the year ended December31, 2020.

Noninterest IncomeNoninterest income for the quarter ended December31, 2021 was $19.2 million, a decrease of $947 thousand, or 4.7%, from the comparable period in the prior year. Noninterest income for the year ended December31, 2021 was $83.2 million, an increase of $4.9 million, or 6.3%, from the prior year.

Net gain on mortgage banking activities decreased $1.8 million, or 41.8%, for the quarter and $1.3 million, or 7.9%, for the year ended December31, 2021 compared to the comparable periods in the prior year. The decrease for the three months and year ended December 31, 2021 was primarily due to a decrease in volume and a contraction of margins. Investment advisory commission and fee income increased $741 thousand, or 17.9%, for the quarter and $3.0 million, or 18.8%, for the year ended December31, 2021 compared to the comparable periods in the prior year, due to increased assets under management driven by new customer relationships and favorable market conditions. BOLI income decreased $14 thousand, or 1.9%, for the quarter and increased $1.0 million, or 35.4%, for the year ended December31, 2021 compared to the comparable periods in the prior year, primarily due to proceeds from BOLI death benefits of $893 thousand and $196 thousand received in the second and third quarters of 2021, respectively.

Other service fee income increased $667 thousand, or 31.9%, for the quarter and $2.7 million, or 36.2%, for the year ended December31, 2021 compared to the comparable periods in the prior year. Interchange fee income increased $260 thousand for the quarter and $1.2 million for the year ended December31, 2021 compared to the comparable periods in the prior year, due to increased customer activity. Mortgage servicing fees increased $299 thousand for the quarter and $1.2 million for the year ended December31, 2021 compared to the comparable period in the prior year, driven by an increase in retained servicing associated with elevated mortgage volume and reduced amortization due to decreased refinance activity and lower prepayment assumptions.

Other income decreased $928 thousand, or 47.9%, for the quarter and $1.5 million, or 24.7%, for the year ended December31, 2021 compared to comparable periods in the prior year. Fees on risk participation agreements for interest rate swaps decreased $1.2 million and $3.5 million during the quarter and year ended December31, 2021, respectively, compared to comparable periods in the prior year driven by a decrease in customer demand. Gain on the sale of SBA loans increased $354 thousand and $1.3 million during the quarter and year ended December31, 2021, respectively, compared to comparable periods in the prior year. This increase was reflective of the Corporation's continued commitment to delivering comprehensive financial solutions to small businesses through the expansion of the SBA lending team during the first half of 2021. Other income also increased $347 thousand driven by an increase in the fair value of equity securities during the year ended December 31, 2021 compared to the year ended December 31, 2020.

Noninterest ExpenseNoninterest expense for the quarter ended December31, 2021 was $43.3 million, an increase of $1.6 million, or 3.8%, from the comparable period in the prior year. Noninterest expense for the year ended December31, 2021 was $167.4 million, an increase of $12.4 million, or 8.0%, from the prior year.

Salaries, benefits and commissions increased $3.8 million, or 15.9%, for the quarter and $11.0 million, or 11.8%, for the year ended December31, 2021 compared to the comparable periods in the prior year. These increases reflect our continued investment in revenue producing staff across all business lines and annual merit increases. The Corporation modified the vesting criteria for performance-based restricted stock grants in 2020 to better reflect the operating environment, which resulted in a benefit of $928 thousand in salaries, benefits and commissions in the fourth quarter of 2020. Additionally, variable incentive compensation expenses increased $999 thousand and $3.6 million for the quarter and year ended December31, 2021, respectively, from the comparable periods in the prior year, due to increased profitability.

Professional fees increased $314 thousand, or 21.9%, for the quarter and $2.3 million, or 44.0%, for the year ended December31, 2021 compared to the comparable periods in the prior year, primarily attributable to increased consultant fees in support of our Diversity, Equity and Inclusion program, training initiatives and treasury management product enhancements. During 2021, we spent $1.5 million on these initiatives. These expenses are not expected to re-occur in subsequent periods. Data processing expenses increased $394 thousand, or 13.3%, for the quarter and $1.4 million, or 12.4%, for the year ended December31, 2021 compared to the comparable periods in the prior year, primarily due to continued investments in our end-to-end loan origination solution for loans below $1.0 million, customer relationship management software, internal infrastructure improvements and outsourced data processing solutions.

Restructuring charges decreased $1.4 million for the quarter and year ended December 31, 2021 compared to the comparable periods in the prior year. These charges relate to the Corporation's financial center optimization plan announced in the fourth quarter of 2020. Other expense decreased $1.3 million, or 18.1%, for the quarter and $961 thousand, or 4.1%, for the year ended December 31, 2021 compared to the comparable periods in the prior year, primarily driven by extinguishment of long-term debt expense of $1.1 million and $1.8 million for the quarter and year ended December 31, 2020, respectively, offset primarily by increases in interchange expense driven by increased customer activity.

Asset Quality and Provision for Credit LossesNonperforming assets were $34.0 million at December31, 2021, compared to $37.1 million at September30, 2021 and $40.5 million at December31, 2020.

Net loan and lease recoveries were $243 thousand during the fourth quarter of 2021 compared to net loan and lease charge-offs of $618thousand for the same period in the prior year. The provision for credit losses was $1.4 million for the fourth quarter of 2021, of which $788 thousand (after-tax expense of $623 thousand), or $0.02 diluted earnings per share, was attributable to unfavorable changes in economic-related assumptions within the Corporations CECL model and $1.3 million was attributable to an increase in reserves for loans. These increases were offset by a decrease of $681 thousand in reserves for unfunded commitments and investment securities. The reversal of provision for credit losses was $8.7 million for the comparable period in the prior year, due to a reserve decrease of $8.2 million related to loans and leases and $690 thousand related to unfunded commitments, offset by a reserve increase of $176 thousand related to investment securities. $11.6 million (after-tax benefit of $9.2 million), or $0.31 diluted earnings per share, of the $8.7 million reversal of provision for credit losses was attributable to changes in economic-related assumptions within the Corporations CECL model.

Net loan and lease charge-offs were $213 thousand for the year ended December31, 2021 compared to $4.6 million for the same period in the prior year. The reversal of provision for credit losses was $10.1 million for the year ended December31, 2021, of which $17.9 million (after-tax benefit of $14.2 million), or $0.48 diluted earnings per share, was attributable to favorable changes in economic-related assumptions within the Corporations CECL model partially offset by a $7.4 million increase in reserves for loans. The provision for credit losses was $40.8 million for the prior year due to a reserve increase of $39.4 million related to loans and leases, $786 thousand related to reserves for unfunded commitments, and $569 thousand related to investment securities. $27.4 million (after-tax charge of $21.6 million), or $0.74 diluted earnings per share, of the $40.8 million of provision for credit losses was attributable to changes in economic-related assumptions within the Corporations CECL model.

The allowance for credit losses on loans and leases as a percentage of loans and leases held for investment was 1.35% at December31, 2021, compared to 1.34% at September30, 2021, and 1.56% at December31, 2020. The allowance for credit losses on loans and leases as a percentage of loans and leases held for investment, excluding PPP loans1, was 1.36% at December31, 2021 compared to 1.36% at September30, 2021 and 1.72% at December31, 2020.

Tax Provision The effective income tax rate was 19.7% for the year ended December31, 2021 compared to an effective income tax rate of 17.5% for the year ended December31, 2020. The effective tax rate for the year ended December31, 2021 and 2020 reflects the level of pre-tax income and the benefits of tax-exempt income from investments in municipal securities and loans and leases.

DividendOn January 26, 2022, Univest declared a quarterly cash dividend of $0.20 per share. The dividend will be paid on February 23, 2022 to shareholders of record as of February 9, 2022.

Conference CallUnivest will host a conference call to discuss fourth quarter and year end 2021 results on Thursday, January 27, 2022 at 9:00 a.m. EST. Participants may preregister at https://www.incommglobalevents.com/registration/q4inc/9616/univest-financial-corporation-to-hold-fourth-quarter-and-year-end-2021-earnings-call/. The general public can access the call by dialing 1-844-200-6205; using Access Code 454983.A replay of the conference call will be available through February 28, 2022 by dialing 1-866-813-9403; using Access Code: 298990.

1Non-GAAP metric. A reconciliation of this and other non-GAAP financial measures is included within this document.

About Univest Financial CorporationUnivest Financial Corporation (UVSP), including its wholly-owned subsidiary Univest Bank and Trust Co., Member FDIC, has approximately $7.1 billion in assets and $4.9 billion in assets under management and supervision through its Wealth Management lines of business at December31, 2021. 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 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 results to differ materially from those expressed or implied by the forward-looking statements. These factors include, but are not limited to: (1) competition; (2) changes in interest rates; (3) changes in asset quality, prepayment speeds, loan sale volumes, charge-offs and credit loss provisions; (4) changes in economic conditions nationally and in our market; (5) economic assumptions that may impact our allowance for credit losses calculation; (6) legislative, regulatory or tax changes that may adversely affect businesses; (7) technological issues that may adversely affect our operations or those of our customers; (8) changes in the securities markets or (9) risk factors mentioned in the reports and registration statements Univest files with the Securities and Exchange Commission.

Additionally, it is difficult to predict the full impact of the COVID-19 pandemic on our business. The extent of such impact will depend on future developments, which are highly uncertain, including when the coronavirus can be controlled and abated. As the result of the COVID-19 pandemic and the related adverse local and national economic consequences, we could be subject to any of the following risks, any of which could have a material, adverse effect on our business, financial condition, liquidity, and results of operations: (1) demand for our products and services may decline; (2) if economic conditions worsen, loan delinquencies, problem assets, and foreclosures may increase and our allowance for credit losses may have to be increased; (3) collateral for loans, especially real estate, may decline in value; (4) the net worth and liquidity of loan guarantors may decline, impairing their ability to honor commitments to us; (5) a material decrease in net income or a net loss over several quarters could result in the elimination of or a decrease in the rate of our quarterly cash dividend; (6) our wealth management revenues may decline with continuing market turmoil; (7) litigation, regulatory enforcement risk and reputation risk regarding our participation in the Paycheck Protection Program and the risk that the Small Business Administration may not fund some or all PPP loan guarantees; and (8) our cyber security risks are increased as the result of an increase in the number of employees working remotely. Univest undertakes no obligation to revise these forward-looking statements or to reflect events or circumstances after the date of this press release.

(UVSP - ER)

Univest Financial CorporationConsolidated Selected Financial Data (Unaudited)December 31, 2021(Dollars in thousands) Balance Sheet (Period 12/31/21 09/30/21 06/30/21 03/31/21 12/31/20 End)Assets $ 7,122,421 $ 6,979,852 $ 6,356,305 $ 6,416,665 $ 6,336,496 Cash and cash 890,150 902,357 203,449 187,317 219,858 equivalentsInvestment securities,net of allowance for 496,989 393,377 397,426 377,506 373,176 credit lossesLoans held for sale 21,600 29,093 27,322 22,636 37,039 Loans and leases held 5,310,017 5,252,045 5,327,313 5,415,006 5,306,841 for investment, grossAllowance for credit 71,924 70,146 71,355 71,497 83,044 losses, loans and leasesLoans and leases held 5,238,093 5,181,899 5,255,958 5,343,509 5,223,797 for investment, netTotal deposits 6,055,124 5,938,154 5,318,704 5,311,592 5,242,715 Noninterest-bearing 2,065,423 1,861,007 1,872,031 1,857,547 1,690,663 depositsInterest-bearing demand, 3,505,535 3,583,107 2,954,450 2,979,834 2,988,277 money market and savingsTime deposits 484,166 494,040 492,223 474,211 563,775 Borrowings 213,980 207,898 218,970 295,293 311,421 Shareholders' equity 773,794 756,023 739,998 722,455 692,472 Balance Sheet (Average) For the three months ended, For the twelve months ended, 12/31/21 09/30/21 06/30/21 03/31/21 12/31/20 12/31/21 12/31/20Assets $ 7,088,289 $ 6,698,177 $ 6,443,629 $ 6,383,463 $ 6,353,519 $ 6,655,443 $ 6,006,877 Investment securities,net of allowance for 469,588 395,280 385,694 374,369 369,511 406,463 402,011 credit lossesLoans and leases, gross 5,255,279 5,320,411 5,389,110 5,325,897 5,253,720 5,322,475 4,888,801 Deposits 6,041,798 5,666,725 5,351,089 5,296,147 5,222,452 5,591,195 4,850,890 Shareholders' equity 762,334 746,185 728,750 699,736 676,426 734,456 668,201 Asset Quality Data (Period End) 12/31/21 09/30/21 06/30/21 03/31/21 12/31/20 Nonaccrual loans andleases, including nonaccrual troubled debtrestructuredloans and leases andnonaccrual loans held $ 33,210 $ 34,528 $ 37,466 $ 29,996 $ 31,692 for saleAccruing loans andleases 90 days or more 498 2,204 750 664 1,392 past dueAccruing troubled debtrestructured loans and 51 51 52 52 53 leasesTotal nonperforming 33,759 36,783 38,268 30,712 33,137 loans and leasesOther real estate owned 279 279 279 7,481 7,355 Total nonperforming $ 34,038 $ 37,062 $ 38,547 $ 38,193 $ 40,492 assetsNonaccrual loans andleases / Loans andleases held for 0.63 % 0.66 % 0.70 % 0.55 % 0.60 % investment andnonaccrual loans heldfor saleNonperforming loans andleases / Loans and 0.64 % 0.70 % 0.72 % 0.57 % 0.62 % leases held forinvestmentNonperforming assets / 0.48 % 0.53 % 0.61 % 0.60 % 0.64 % Total assets Allowance for credit $ 71,924 $ 70,146 $ 71,355 $ 71,497 $ 83,044 losses, loans and leasesAllowance for creditlosses, loans and leases 1.35 % 1.34 % 1.34 % 1.32 % 1.56 % / Loans and leases heldfor investmentAllowance for creditlosses, loans and leases/ Loans and leases heldfor investment, 1.36 % 1.36 % 1.41 % 1.46 % 1.72 % excluding PaycheckProtection Program loans(1)Allowance for creditlosses, loans and leases/ Nonaccrual loans and 216.57 % 203.16 % 212.97 % 238.36 % 262.03 % leases held forinvestmentAllowance for creditlosses, loans and leases/ Nonperforming loans 213.05 % 190.70 % 208.00 % 232.80 % 250.61 % and leases held forinvestment For the three months ended, For the twelve months ended, 12/31/21 09/30/21 06/30/21 03/31/21 12/31/20 12/31/21 12/31/20Net loan and lease $ (243 ) $ (75 ) $ 243 $ 288 $ 618 $ 213 $ 4,648 (recoveries) charge-offsNet loan and lease(recoveries) charge-offs (0.02 %) (0.01 %) 0.02 % 0.02 % 0.05 % 0.00 % 0.10 %(annualized)/Averageloans and leases (1) Non-GAAP metric. A reconciliation of this and other non-GAAP financial measures is included at the end of this document.

Univest Financial Corporation Consolidated Selected Financial Data (Unaudited) December 31, 2021 (Dollars inthousands, except pershare data) For the three months ended, For the twelve months ended, For the period: 12/31/21 09/30/21 06/30/21 03/31/21 12/31/20 12/31/21 12/31/20 Interest income $ 52,262 $ 53,571 $ 52,441 $ 51,457 $ 51,334 $ 209,731 $ 203,945 Interest 4,737 4,884 5,684 6,043 6,813 21,348 29,584 expenseNet interest 47,525 48,687 46,757 45,414 44,521 188,383 174,361 incomeProvision(reversal of 1,392 (182 ) (59 ) (11,283 ) (8,721 ) (10,132 ) 40,794 provision) forcredit lossesNet interestincome after 46,133 48,869 46,816 56,697 53,242 198,515 133,567 provision forcredit lossesNoninterest income:Trust fee 2,086 2,126 2,157 2,034 1,974 8,403 7,703 incomeService chargeson deposit 1,486 1,422 1,314 1,282 1,371 5,504 4,845 accountsInvestmentadvisory 4,885 4,796 4,558 4,697 4,144 18,936 15,944 commission andfee incomeInsurancecommission and 3,726 3,837 3,839 4,955 3,512 16,357 16,087 fee incomeOther service 2,759 2,576 2,748 2,192 2,092 10,275 7,543 fee incomeBank owned lifeinsurance 719 925 1,620 717 733 3,981 2,940 incomeNet gain onsales of 5 21 54 65 54 145 871 investmentsecuritiesNet gain onmortgage 2,518 3,224 3,461 5,938 4,323 15,141 16,442 bankingactivitiesOther income 1,008 1,625 479 1,370 1,936 4,482 5,953 Totalnoninterest 19,192 20,552 20,230 23,250 20,139 83,224 78,328 incomeNoninterest expense:Salaries,benefits and 27,374 26,641 25,396 24,780 23,613 104,191 93,208 commissionsNet occupancy 2,477 2,525 2,656 2,739 2,697 10,397 10,358 Equipment 985 1,000 968 946 951 3,899 3,841 Data processing 3,355 3,274 3,064 3,050 2,961 12,743 11,333 Professional 1,750 2,174 2,015 1,748 1,436 7,687 5,338 feesMarketing and 683 539 561 280 575 2,063 1,975 advertisingDepositinsurance 698 765 613 636 765 2,712 2,591 premiumsIntangible 267 214 249 249 282 979 1,216 expensesRestructuring - - - - 1,439 - 1,439 chargesOther expense 5,746 6,116 5,764 5,112 7,015 22,738 23,699 Totalnoninterest 43,335 43,248 41,286 39,540 41,734 167,409 154,998 expenseIncome before 21,990 26,173 25,760 40,407 31,647 114,330 56,897 taxesIncome tax 4,578 5,262 4,885 7,804 5,773 22,529 9,981 expenseNet income $ 17,412 $ 20,911 $ 20,875 $ 32,603 $ 25,874 $ 91,801 $ 46,916 Net income per share:Basic $ 0.59 $ 0.71 $ 0.71 $ 1.11 $ 0.88 $ 3.12 $ 1.60 Diluted $ 0.59 $ 0.71 $ 0.71 $ 1.11 $ 0.88 $ 3.11 $ 1.60 Dividendsdeclared per $ 0.20 $ 0.20 $ 0.20 $ 0.20 $ - $ 0.80 $ 0.60 shareWeightedaverage shares 29,471,304 29,420,256 29,389,525 29,327,432 29,274,915 29,402,845 29,243,773 outstandingPeriod endshares 29,500,542 29,438,402 29,411,731 29,379,575 29,295,052 29,500,542 29,295,052 outstanding

Univest Financial CorporationConsolidated Selected Financial Data (Unaudited)December 31, 2021 For the three months ended, For the twelve months ended,ProfitabilityRatios 12/31/21 09/30/21 06/30/21 03/31/21 12/31/20 12/31/21 12/31/20(annualized) Return on 0.97 % 1.24 % 1.30 % 2.07 % 1.62 % 1.38 % 0.78 %average assetsReturn on averageassets, excluding 0.97 % 1.24 % 1.30 % 2.07 % 1.69 % 1.38 % 0.80 %restructuringcharges (1) Return onaverage 9.06 % 11.12 % 11.49 % 18.90 % 15.22 % 12.50 % 7.02 %shareholders'equityReturn on averageshareholders' 9.06 % 11.12 % 11.49 % 18.90 % 15.89 % 12.50 % 7.19 %equity, excludingrestructuring charges (1)Return onaverage tangible 11.79 % 14.51 % 15.11 % 25.20 % 20.54 % 16.41 % 9.52 %common equity(1)Return on averagetangible common 11.79 % 14.51 % 15.11 % 25.20 % 21.44 % 16.41 % 9.76 %equity, excludingrestructuring charges (1)Net interest 2.86 % 3.11 % 3.15 % 3.12 % 3.02 % 3.06 % 3.16 %margin (FTE)Efficiency ratio 64.3 % 61.8 % 60.7 % 57.0 % 63.8 % 60.9 % 60.6 %(2)Efficiency ratio,excluding 64.3 % 61.8 % 60.7 % 57.0 % 61.6 % 60.9 % 60.0 %restructuringcharges (1) (2) Capitalization Ratios Dividendsdeclared to net 33.9 % 28.1 % 28.2 % 18.0 % 0.0 % 25.6 % 37.4 %income (3)Shareholders'equity to assets 10.86 % 10.83 % 11.64 % 11.26 % 10.93 % 10.86 % 10.93 %(Period End)Tangible commonequity to 8.56 % 8.55 % 9.15 % 8.77 % 8.40 % 8.56 % 8.40 %tangible assets(1)Common equitybook value per $ 26.23 $ 25.68 $ 25.16 $ 24.59 $ 23.64 $ 26.23 $ 23.64 shareTangible commonequity book value $ 20.14 $ 19.75 $ 19.22 $ 18.64 $ 17.66 $ 20.14 $ 17.66 per share (1) RegulatoryCapital Ratios (Period End)Tier 1 leverage 9.13 % 9.53 % 9.64 % 9.45 % 9.08 % 9.13 % 9.08 %ratioCommon equitytier 1 11.08 % 11.15 % 11.04 % 11.08 % 10.76 % 11.08 % 10.76 %risk-basedcapital ratioTier 1risk-based 11.08 % 11.15 % 11.04 % 11.08 % 10.76 % 11.08 % 10.76 %capital ratioTotal risk-based 13.77 % 13.87 % 13.82 % 15.13 % 15.31 % 13.77 % 15.31 %capital ratio (1) Non-GAAP metric. A reconciliation of this and other non-GAAP financialmeasures is included below.(2) Noninterest expense to net interest income before loan loss provision plusnoninterest income adjusted for tax equivalent income.(3) As announced in the September 30, 2020 Earnings Release, the Corporationchanged the timing of future dividend declarations and payments.

Univest Financial Corporation Average Balances and Interest Rates (Unaudited) For the Three Months Ended, Tax Equivalent December 31, 2021 September 30, 2021 Basis Average Income/ Average Average Income/ Average (Dollars in Balance Expense Rate Balance Expense Rate thousands)Assets: Interest-earningdeposits with other $ 914,287 $ 370 0.16 % $ 530,191 $ 189 0.14 %banksU.S. government 6,999 37 2.10 6,999 36 2.04 obligationsObligations ofstate and political 2,334 19 3.23 2,992 24 3.18 subdivisionsOther debt and 460,255 1,845 1.59 385,289 1,516 1.56 equity securitiesFederal Home LoanBank, Federal 28,402 375 5.24 26,713 334 4.96 Reserve Bank andother stockTotalinterest-earningdeposits,investments and 1,412,277 2,646 0.74 952,184 2,099 0.87 otherinterest-earningassets Commercial,financial, and 869,471 7,022 3.20 880,986 7,412 3.34 agricultural loansPaycheck Protection 53,745 1,568 11.57 162,611 4,162 10.15 Program loansRealestate?commercial 2,826,720 26,669 3.74 2,784,398 25,634 3.65 and constructionloansRealestate?residential 1,107,911 10,165 3.64 1,100,799 10,171 3.67 loansLoans to 26,462 249 3.73 26,048 253 3.85 individualsMunicipal loans and 245,038 2,515 4.07 247,603 2,504 4.01 leasesLease financings 125,932 1,951 6.15 117,966 1,856 6.24 Gross loans and 5,255,279 50,139 3.79 5,320,411 51,992 3.88 leasesTotalinterest-earning 6,667,556 52,785 3.14 6,272,595 54,091 3.42 assetsCash and due from 54,958 59,642 banksAllowance forcredit losses, (71,020 ) (72,606 ) loans and leasesPremises and 56,087 55,685 equipment, netOperating lease 31,048 31,998 right-of-use assetsOther assets 349,660 350,863 Total assets $ 7,088,289 $ 6,698,177 Liabilities: Interest-bearing $ 939,478 $ 493 0.21 % $ 857,098 $ 537 0.25 %checking depositsMoney market 1,616,890 968 0.24 1,382,832 922 0.26 savingsRegular savings 997,814 253 0.10 998,568 281 0.11 Time deposits 487,434 1,370 1.12 496,702 1,490 1.19 Total time andinterest-bearing 4,041,616 3,084 0.30 3,735,200 3,230 0.34 deposits Short-term 14,144 1 0.03 15,116 2 0.05 borrowingsLong-term debt 95,000 325 1.36 95,000 324 1.35 Subordinated notes 98,833 1,327 5.33 98,754 1,328 5.34 Total borrowings 207,977 1,653 3.15 208,870 1,654 3.14 Totalinterest-bearing 4,249,593 4,737 0.44 3,944,070 4,884 0.49 liabilitiesNoninterest-bearing 2,000,182 1,931,525 depositsOperating lease 34,114 35,094 liabilitiesAccrued expensesand other 42,066 41,303 liabilitiesTotal liabilities 6,325,955 5,951,992 Shareholders' Equity:Common stock 157,784 157,784 Additional paid-in 298,508 297,482 capitalRetained earnings 306,042 290,919 and other equityTotal shareholders' 762,334 746,185 equityTotal liabilitiesand shareholders' $ 7,088,289 $ 6,698,177 equityNet interest income $ 48,048 $ 49,207 Net interest spread 2.70 2.93 Effect of netinterest-free 0.16 0.18 funding sourcesNet interest margin 2.86 % 3.11 %Ratio of averageinterest-earningassets to average 156.90 % 159.04 % interest-bearingliabilities Note 1: For rate calculation purposes, average loan and lease categoriesinclude deferred fees and costs and purchase accounting adjustments.Nonaccrual loans and leases have been included in the average loan and lease balances. Loans held for sale have beenincluded in the average loan balances. Tax-equivalent amounts for the threemonths ended December 31, 2021 and September 30, 2021 havebeen 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 December 31,Tax Equivalent 2021 2020 Basis Average Income/ Average Average Income/ Average (Dollars in Balance Expense Rate Balance Expense Rate thousands)Assets: Interest-earningdeposits with other $ 914,287 $ 370 0.16 % $ 296,258 $ 82 0.11 %banksU.S. government 6,999 37 2.10 6,998 36 2.05 obligationsObligations ofstate and political 2,334 19 3.23 14,269 129 3.60 subdivisionsOther debt and 460,255 1,845 1.59 348,244 1,237 1.41 equity securitiesFederal Home LoanBank, Federal 28,402 375 5.24 29,838 438 5.84 Reserve Bank andother stockTotalinterest-earningdeposits,investments and 1,412,277 2,646 0.74 695,607 1,922 1.10 otherinterest-earningassets Commercial,financial, and 869,471 7,022 3.20 824,374 7,366 3.55 agricultural loansPaycheck Protection 53,745 1,568 11.57 497,035 3,133 2.51 Program loansRealestate?commercial 2,826,720 26,669 3.74 2,518,056 24,388 3.85 and constructionloansRealestate?residential 1,107,911 10,165 3.64 1,025,818 10,345 4.01 loansLoans to 26,462 249 3.73 27,427 289 4.19 individualsMunicipal loans and 245,038 2,515 4.07 258,627 2,776 4.27 leasesLease financings 125,932 1,951 6.15 102,383 1,690 6.57 Gross loans and 5,255,279 50,139 3.79 5,253,720 49,987 3.79 leasesTotalinterest-earning 6,667,556 52,785 3.14 5,949,327 51,909 3.47 assetsCash and due from 54,958 53,360 banksAllowance forcredit losses, (71,020 ) (92,766 ) loans and leasesPremises and 56,087 55,653 equipment, netOperating lease 31,048 34,272 right-of-use assetsOther assets 349,660 353,673 Total assets $ 7,088,289 $ 6,353,519 Liabilities: Interest-bearing $ 939,478 $ 493 0.21 % $ 838,323 $ 537 0.25 %checking depositsMoney market 1,616,890 968 0.24 1,213,585 898 0.29 savingsRegular savings 997,814 253 0.10 905,918 341 0.15 Time deposits 487,434 1,370 1.12 582,782 2,034 1.39 Total time andinterest-bearing 4,041,616 3,084 0.30 3,540,608 3,810 0.43 deposits Short-term 14,144 1 0.03 15,091 2 0.05 borrowingsLong-term debt 95,000 325 1.36 169,623 611 1.43 Subordinated notes 98,833 1,327 5.33 193,244 2,390 4.92 Total borrowings 207,977 1,653 3.15 377,958 3,003 3.16 Totalinterest-bearing 4,249,593 4,737 0.44 3,918,566 6,813 0.69 liabilitiesNoninterest-bearing 2,000,182 1,681,844 depositsOperating lease 34,114 37,616 liabilitiesAccrued expensesand other 42,066 39,067 liabilitiesTotal liabilities 6,325,955 5,677,093 Shareholders' Equity:Common stock 157,784 157,784 Additional paid-in 298,508 296,810 capitalRetained earnings 306,042 221,832 and other equityTotal shareholders' 762,334 676,426 equityTotal liabilitiesand shareholders' $ 7,088,289 $ 6,353,519 equityNet interest income $ 48,048 $ 45,096 Net interest spread 2.70 2.78 Effect of netinterest-free 0.16 0.24 funding sourcesNet interest margin 2.86 % 3.02 %Ratio of averageinterest-earningassets to average 156.90 % 151.82 % interest-bearingliabilities Note 1: For rate calculation purposes, average loan and lease categoriesinclude deferred fees and costs and purchase accounting adjustments.Nonaccrual loans and leases have been included in the average loan and lease balances. Loans held for sale have beenincluded in the average loan balances. Tax-equivalent amounts for the three months ended December 31, 2021 and 2020 havebeen calculated using the Corporation?s federal applicable rate of 21.0%.

Univest Financial Corporation Average Balances and Interest Rates (Unaudited) For the Twelve Months Ended December 31, Tax Equivalent 2021 2020 Basis Average Income/ Average Average Income/ Average (Dollars in Balance Expense Rate Balance Expense Rate thousands)Assets: Interest-earningdeposits with other $ 476,351 $ 661 0.14 % $ 274,372 $ 574 0.21 %banksU.S. government 6,999 144 2.06 7,132 145 2.03 obligationsObligations ofstate and political 5,702 206 3.61 23,065 825 3.58 subdivisionsOther debt and 393,762 5,992 1.52 371,814 7,697 2.07 equity securitiesFederal Home LoanBank, Federal 26,844 1,417 5.28 29,726 1,746 5.87 Reserve Bank andother stockTotalinterest-earningdeposits,investments and 909,658 8,420 0.93 706,109 10,987 1.56 otherinterest-earningassets Commercial,financial, and 840,133 28,142 3.35 817,489 30,657 3.75 agricultural loansPaycheck Protection 281,484 15,032 5.34 342,920 8,072 2.35 Program loansRealestate?commercial 2,734,259 101,692 3.72 2,312,996 94,962 4.11 and constructionloansRealestate?residential 1,077,952 40,045 3.71 1,007,915 42,047 4.17 loansLoans to 26,062 1,018 3.91 28,792 1,332 4.63 individualsMunicipal loans and 247,396 10,147 4.10 283,495 11,857 4.18 leasesLease financings 115,189 7,363 6.39 95,194 6,498 6.83 Gross loans and 5,322,475 203,439 3.82 4,888,801 195,425 4.00 leasesTotalinterest-earning 6,232,133 211,859 3.40 5,594,910 206,412 3.69 assetsCash and due from 55,724 52,000 banksAllowance forcredit losses, (74,943 ) (73,459 ) loans and leasesPremises and 55,875 55,888 equipment, netOperating lease 32,758 34,277 right-of-use assetsOther assets 353,896 343,261 Total assets $ 6,655,443 $ 6,006,877 Liabilities: Interest-bearing $ 850,713 $ 2,007 0.24 % $ 692,049 $ 2,173 0.31 %checking depositsMoney market 1,366,762 3,574 0.26 1,113,039 5,551 0.50 savingsRegular savings 983,752 1,114 0.11 874,366 2,057 0.24 Time deposits 498,638 6,178 1.24 572,103 9,835 1.72 Total time andinterest-bearing 3,699,865 12,873 0.35 3,251,557 19,616 0.60 deposits Short-term 16,552 8 0.05 86,658 327 0.38 borrowingsLong-term debt 96,562 1,318 1.36 189,410 2,879 1.52 Subordinated notes 137,896 7,149 5.18 134,949 6,762 5.01 Total borrowings 251,010 8,475 3.38 411,017 9,968 2.43 Totalinterest-bearing 3,950,875 21,348 0.54 3,662,574 29,584 0.81 liabilitiesNoninterest-bearing 1,891,330 1,599,333 depositsOperating lease 36,001 37,557 liabilitiesAccrued expensesand other 42,781 39,212 liabilitiesTotal liabilities 5,920,987 5,338,676 Shareholders' Equity:Common stock 157,784 157,784 Additional paid-in 297,189 296,023 capitalRetained earnings 279,483 214,394 and other equityTotal shareholders' 734,456 668,201 equityTotal liabilitiesand shareholders' $ 6,655,443 $ 6,006,877 equityNet interest income $ 190,511 $ 176,828 Net interest spread 2.86 2.88 Effect of netinterest-free 0.20 0.28 funding sourcesNet interest margin 3.06 % 3.16 %Ratio of averageinterest-earningassets to average 157.74 % 152.76 % interest-bearingliabilities Note 1: For rate calculation purposes, average loan and lease categoriesinclude deferred fees and costs and purchase accounting adjustments.Nonaccrual loans and leases have been included in the average loan and lease balances. Loans held for sale have beenincluded in the average loan balances. Tax-equivalent amounts for the twelvemonths ended December 31, 2021 and 2020 havebeen calculated using the Corporation?s federal applicable rate of 21.0%.

Univest Financial Corporation Loan Portfolio Overview (Unaudited) (Dollars in thousands) As of December 31, 2021 $ Modified Total % of Balance LoansIndustry Description Outstanding Commercial of as a % of Balance Loan Modified Portfolio (excl PPP) Portfolio Loans (1) (1)CRE - Retail 350,373 8.0 % $ - - %Animal Production 304,487 7.0 - - CRE - 1-4 Family 255,397 5.8 - - Residential InvestmentCRE - Office 235,078 5.4 - - CRE - Multi-family 222,488 5.1 - - Nursing and Residential 169,708 3.9 - - Care FacilitiesHotels & Motels 169,397 3.9 1,437 0.8 (Accommodation)CRE - Industrial / 169,329 3.9 - - WarehouseEducation 162,776 3.7 - - Specialty Trade 130,418 3.0 - - ContractorsCRE - Mixed-Use - 121,019 2.8 3,405 2.8 ResidentialMerchant Wholesalers, 110,675 2.5 - - Durable GoodsCRE - Medical Office 106,348 2.4 - - Homebuilding (tract 93,469 2.1 - - developers, remodelers)Real Estate Lenders,Secondary Market 87,389 2.0 - - FinancingCrop Production 81,704 1.9 - - Motor Vehicle and Parts 78,292 1.8 - - DealersFood Manufacturing 75,587 1.7 - - Wood Product 70,769 1.6 - - ManufacturingRental and Leasing 69,048 1.6 - - ServicesAdministrative and 66,529 1.5 - - Support ServicesPersonal and Laundry 62,051 1.4 - - ServicesFood Services and 59,636 1.4 - - Drinking PlacesFabricated Metal Product 58,924 1.3 - - ManufacturingMerchant Wholesalers, 57,114 1.3 - - Nondurable GoodsRepair and Maintenance 53,820 1.2 - - Miniwarehouse / 51,987 1.2 - - Self-StorageReligious Organizations, 50,432 1.2 - - Advocacy GroupsIndustries with >$50 $ 3,524,244 80.7 % $ 4,842 0.1 %million in outstandingsIndustries with <$50 $ 844,505 19.3 % $ 981 0.1 %million in outstandingsTotal Commercial Loans $ 4,368,749 100.0 % $ 5,823 0.1 % $ Modified Total Balance LoansConsumer Loans and Lease Outstanding of as a % of Financings Balance Modified Portfolio Loans (1) (1)Real Estate-ResidentialSecured for Personal 540,566 338 0.1 %PurposeReal Estate-Home EquitySecured for Personal 158,909 - - PurposeLoans to Individuals 25,504 14 0.1 Lease Financings 184,541 33 - Total - Consumer Loans $ 909,520 $ 385 - %and Lease Financings Total $ 5,278,269 $ 6,208 0.1 % (1) Loan modifications referenced above were made in accordance with Section4013 of the CARES Act, the Consolidated Appropriations Act, 2021 and theInteragency Statement on Loan Modifications and Reporting for FinancialInstitutions Working with Customers Affected by the Coronavirus and thereforewere not classified as TDRs as of December 31, 2021.

Univest Financial CorporationNon-GAAP ReconciliationDecember 31, 2021

Non-GAAP to GAAP ReconciliationManagement uses non-GAAP measures in its analysis of the Corporation'sperformance. These measures should not be considered a substitute for GAAPbasis measures nor should they be viewed as a substitute for operating resultsdetermined in accordance with GAAP. Management believes the presentation of thenon-GAAP financial measures, which exclude the impact of the specified items,provides useful supplemental information that is essential to a properunderstanding of the financial results of the Corporation. See the table belowfor additional information on non-GAAP measures used throughout this earningsrelease. As of or for the three months ended, As of or for the twelve months ended, 12/31/21 09/30/21 06/30/21 03/31/21 12/31/20 12/31/21 12/31/20Restructuring charges $ - $ - $ - $ - $ 1,439 $ - $ 1,439 (a)Tax effect of - - - - (302 ) - (302 )restructuring chargesRestructuring $ - $ - $ - $ - $ 1,137 $ - $ 1,137 charges, net of tax Shareholders' equity $ 773,794 $ 756,023 $ 739,998 $ 722,455 $ 692,472 $ 773,794 $ 692,472 Goodwill (175,510 ) (172,559 ) (172,559 ) (172,559 ) (172,559 ) (175,510 ) (172,559 )Other intangibles (b) (4,210 ) (1,922 ) (2,073 ) (2,326 ) (2,580 ) (4,210 ) (2,580 )Tangible common equity $ 594,074 $ 581,542 $ 565,366 $ 547,570 $ 517,333 $ 594,074 $ 517,333 Total assets $ 7,122,421 $ 6,979,852 $ 6,356,305 $ 6,416,665 $ 6,336,496 $ 7,122,421 $ 6,336,496 Goodwill (175,510 ) (172,559 ) (172,559 ) (172,559 ) (172,559 ) (175,510 ) (172,559 )Other intangibles (b) (4,210 ) (1,922 ) (2,073 ) (2,326 ) (2,580 ) (4,210 ) (2,580 )Tangible assets $ 6,942,701 $ 6,805,371 $ 6,181,673 $ 6,241,780 $ 6,161,357 $ 6,942,701 $ 6,161,357 Average shareholders' $ 762,334 $ 746,185 $ 728,750 $ 699,736 $ 676,426 $ 734,456 $ 668,201 equityAverage goodwill (173,553 ) (172,559 ) (172,559 ) (172,559 ) (172,559 ) (172,810 ) (172,559 )Average other (2,696 ) (1,983 ) (2,209 ) (2,464 ) (2,734 ) (2,338 ) (3,181 )intangibles (b)Average tangible common $ 586,085 $ 571,643 $ 553,982 $ 524,713 $ 501,133 $ 559,308 $ 492,461 equity Net income before taxes $ 21,990 $ 26,173 $ 25,760 $ 40,407 $ 31,647 $ 114,330 $ 56,897 Provision for credit 1,392 (182 ) (59 ) (11,283 ) (8,721 ) (10,132 ) 40,794 lossesPre-tax pre-provision $ 23,382 $ 25,991 $ 25,701 $ 29,124 $ 22,926 $ 104,198 $ 97,691 income Loans and leases held $ 5,310,017 $ 5,252,045 $ 5,327,313 $ 5,415,006 $ 5,306,841 $ 5,310,017 $ 5,306,841 for investment, grossPaycheck Protection (31,748 ) (85,601 ) (252,849 ) (528,452 ) (483,773 ) (31,748 ) (483,773 )Program ("PPP") loansGross loans and leases $ 5,278,269 $ 5,166,444 $ 5,074,464 $ 4,886,554 $ 4,823,068 $ 5,278,269 $ 4,823,068 excluding PPP loans Allowance for credit $ 71,924 $ 70,146 $ 71,355 $ 71,497 $ 83,044 $ 71,924 $ 83,044 losses, loans and leasesGross loans and leases 5,278,269 5,166,444 5,074,464 4,886,554 4,823,068 5,278,269 4,823,068 excluding PPP loansAllowance for creditlosses, loans and leasesas a percentage of gross 1.36 % 1.36 % 1.41 % 1.46 % 1.72 % 1.36 % 1.72 %loans and leasesexcluding PPP loans (a) Associated with financial center optimization plan(b) Amount does not include mortgage servicing rights

CONTACT:Brian J. RichardsonUNIVEST FINANCIAL CORPORATIONChief Financial Officer215-721-2446, richardsonb@univest.net