Attached files
| file | filename |
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| EX-99.2 - EXHIBIT 99.2 - UNIVEST FINANCIAL Corp | ex992directorresignpolicy.htm |
| 8-K - 8-K - UNIVEST FINANCIAL Corp | uvsp8kearningdirresignpolicy.htm |
Exhibit 99.1
NEWS |  |
CONTACT: Roger Deacon
UNIVEST CORPORATION OF PENNSYLVANIA
Chief Financial Officer
215-721-2455, DeaconR@univest.net
FOR IMMEDIATE RELEASE
UNIVEST CORPORATION OF PENNSYLVANIA REPORTS SECOND QUARTER RESULTS
SOUDERTON, Pa., July 25, 2018 - Univest Corporation of Pennsylvania (“Univest” or the "Corporation") (NASDAQ: UVSP), parent company of Univest Bank and Trust Co. and its insurance, investments and equipment financing subsidiaries, today announced financial results for the second quarter ended June 30, 2018. Univest reported net income of $4.4 million, or $0.15 diluted earnings per share for the quarter ended June 30, 2018, compared to net income of $11.8 million, or $0.44 diluted earnings per share, for the quarter ended June 30, 2017. Net income for the six months ended June 30, 2018 was $17.2 million, or $0.58 diluted earnings per share, compared to net income of $22.6 million, or $0.85 diluted earnings per share for the six months ended June 30, 2017.
The financial results for the three and six months ended June 30, 2018 included a charge to the provision for loan and lease losses of $12.7 million, which represented $0.34 of diluted earnings per share in each period, related to alleged fraudulent activities believed to be perpetrated by one or more employees of a borrower which was previously reported in the Corporation's Form 8-K filed with the SEC on May 31, 2018. The Bank owns a participating interest which originally totaled $13.0 million in an approximately $80.0 million commercial lending facility. The $12.7 million represents the entire principal amount owed to the Bank and this amount was fully charged-off as of June 30, 2018.
In addition, the financial results for the three and six months ended June 30, 2018 included tax-free bank owned life insurance ("BOLI") death benefit claims of $446 thousand, which represented $0.02 diluted earnings per share in each period. The financial results for the three and six months ended June 30, 2017 included a tax-free BOLI death benefit claim of $889 thousand, which represented $0.03 diluted earnings per share in each period. The six months ended June 30, 2018 included restructuring costs related to
financial center closures of $451 thousand, net of tax, or $0.02 of diluted earnings per share recognized in the first quarter of 2018. There were no restructuring costs during the six months ended June 30, 2017.
The financial results for the three and six months ended June 30, 2018 also included a reduction in the Corporation's statutory federal income tax rate from 35% to 21% effective January 1, 2018 in accordance with the Tax Cuts and Jobs Act of 2017 (“TCJA”).
Loans
Gross loans and leases increased $128.5 million, or 13.9% (annualized), from March 31, 2018 and $198.3 million, or 11.0% (annualized), from December 31, 2017. The growth in loans during 2018 was primarily in commercial real estate, commercial business and residential real estate loans.
Deposits
Total deposits increased $123.5 million, or 14.1% (annualized), from March 31, 2018 and increased $65.9 million, or 3.7% (annualized), from December 31, 2017. Additionally, deposits increased $272.7 million, or 8.1%, from June 30, 2017. The growth in deposits in 2018 was primarily due to increases in consumer time deposits and commercial deposits partially offset by a seasonal decline in public funds deposits. The growth in deposits compared to June 30, 2017 was primarily due to increases in consumer time, commercial and public funds deposits.
Net Interest Income and Margin
Net interest income of $76.3 million for the six months ended June 30, 2018 increased $6.7 million, or 9.6%, from the six months ended June 30, 2017. The increase in net interest income for the six months ended June 30, 2018 as compared to the same period in 2017 was primarily due to the previously described increase in loans.
Net interest margin, on a tax-equivalent basis, was 3.73% for the second quarter of 2018, compared to 3.72% for the first quarter of 2018 and 3.76% for the second quarter of 2017. The favorable impact of purchase accounting accretion was 3 basis points ($349 thousand) for the quarter ended June 30, 2018 compared to 2 basis points ($146 thousand) for the quarter ended March 31, 2018 and 8 basis points ($742 thousand) for the quarter ended June 30, 2017. Excluding the impact of purchase accounting accretion, the net interest margin, on a tax-equivalent basis, was 3.70% for the quarter ended June 30, 2018 compared to 3.70% for the quarter ended March 31, 2018 and 3.68% for the quarter ended June 30, 2017.
Net interest margin, on a tax-equivalent basis, in 2017 was calculated using a 35% federal tax rate as compared to a 21% federal tax rate for the first and second quarters of 2018. Assuming a 21% federal tax
rate and excluding purchase accounting, net interest margin was 3.61% for the quarter ended June 30, 2017.
Noninterest Income
Noninterest income for the quarter ended June 30, 2018 was $15.3 million, a decrease of $695 thousand, or 4.3%, from the second quarter of 2017. Noninterest income for the six months ended June 30, 2018 was $30.9 million, consistent with the same period in the prior year.
Investment advisory commission and fee income increased $445 thousand, or 13.4%, for the quarter and $947 thousand, or 14.5%, for the six months ended June 30, 2018 primarily due to new customer relationships and continued favorable market performance. Insurance commission and fee income increased $562 thousand, or 7.0%, for the six months ended June 30, 2018, primarily due to an increase in contingent commission income of $377 thousand, which is largely recognized in the first quarter of the year and due to an increase in group life and health premiums.
BOLI income decreased $412 thousand for the quarter and $526 thousand for the six months ended June 30, 2018 primarily due to proceeds from the previously mentioned BOLI death benefits of $446 thousand in the second quarter of 2018 as compared to $889 thousand in the second quarter of 2017. The net gain on mortgage banking decreased $595 thousand, or 38.7%, for the quarter and $992 thousand, or 37.4%, for the six months ended June 30, 2018, primarily due to a decrease in refinance mortgage volume, a shortage of housing supply and the Bank retaining, on balance-sheet, a higher percentage of its mortgage originations. Such on balance-sheet loans are predominantly hybrid adjustable rate mortgages. Other income decreased $246 thousand, or 9.7%, for the quarter and $271 thousand, or 5.6%, for the six months ended June 30, 2018. The decrease in the six months ended June 30, 2018 is primarily due to a net loss of $300 thousand related to valuations and sales of other real estate owned and sales of closed branches as compared to a net gain of $289 thousand of such assets in the six months ended June 30, 2017. This unfavorable variance in other income was partially offset by an increase in other service fee income of $368 thousand for the six months ended June 30, 2018.
Noninterest Expense
Noninterest expense for the quarter ended June 30, 2018 was $34.3 million, an increase of $1.8 million, or 5.5%, compared to the second quarter of 2017. Noninterest expense for the six months ended June 30, 2018 was $69.5 million, an increase of $4.9 million, or 7.6% from the comparable period in the prior year.
Salaries, benefits and commissions increased $1.3 million, or 7.1%, for the quarter and $3.2 million, or 8.7%, for the six months ended June 30, 2018, primarily attributable to additional staff hired to support revenue generation across all business lines, expansion of our financial center footprint in Lancaster County
and the Lehigh Valley and annual merit increases. Data processing expense increased $184 thousand for the six months ended June 30, 2018 primarily due to increased investments in customer relationship management software, internal infrastructure improvements and outsourced data processing solutions. Professional fees increased $199 thousand for the six months ended June 30, 2018 primarily due to increased consultant fees. Other expense increased $286 thousand for the quarter and $644 thousand for the six months ended June 30, 2018 primarily due to increases in Bank shares tax and employment related expense. Restructuring costs related to financial center closures and staffing rationalization were $571 thousand during the first quarter of 2018. There were no restructuring costs during the six months ended June 30, 2017. Excluding restructuring costs, noninterest expense for the six months increased $4.3 million or 6.7% from the comparable period in 2017.
Asset Quality and Provision for Loan and Lease Losses
Non-accrual loans and leases, including non-accrual troubled debt restructured loans, were $30.1 million at June 30, 2018, compared to $27.7 million at March 31, 2018 and $14.5 million at December 31, 2017. Nonperforming assets were $32.8 million at June 30, 2018, compared to $32.9 million at March 31, 2018 and $28.6 million at December 31, 2017. The increase in non-accrual loans and leases during 2018 is primarily due to one commercial real estate loan in the amount of $12.3 million being placed on non-accrual status during the first quarter of 2018. This was partially offset by troubled debt restructured commercial real estate loans for another borrower totaling $10.3 million being returned to performing status during the first quarter of 2018 as the borrower was in compliance with the modified terms of the restructuring for the required time period.
Net loan and lease charge-offs were $13.2 million during the second quarter of 2018. The provision for loan and lease losses was $15.4 million for the second quarter of 2018. Both net loan and lease charge-offs and the provision for loan and lease losses includes the previously discussed $12.7 million commercial loan charge-off.
The allowance for loan and lease losses as a percentage of loans and leases held for investment, excluding covered loans acquired in the Fox Chase and Valley Green Bank acquisitions, which were recorded at fair value as of the acquisition date, was 0.76% at June 30, 2018, compared to 0.70% at December 31, 2017 and 0.73% at June 30, 2017.
Tax Provision
The effective income tax rate was 4.2% for the quarter ended June 30, 2018 compared to an effective income tax rate of 26.4% for the quarter ended June 30, 2017. The effective income tax rate was 14.9% for the six months ended June 30, 2018 compared to an effective income tax rate of 26.4% for the six months ended June 30, 2017. As previously discussed, the Corporation's statutory federal tax rate was reduced to
21% effective January 1, 2018 in accordance with the TCJA. The Corporation's effective income tax rate for the six months ended June 30, 2018 was favorably impacted by discrete tax benefits and proceeds from BOLI death benefits. Excluding these items, the effective tax rate was 18.2% for the six months ended June 30, 2018.
Dividend
On May 21, 2018, Univest declared a quarterly cash dividend of $0.20 per share, payable on July 2, 2018. This represented a 2.84% annualized yield based on the closing price of Univest’s stock on the date the dividend was paid.
Conference Call
Univest will host a conference call to discuss second quarter 2018 results on Thursday, July 26, 2018 at 9:00 a.m. EDT. Participants may preregister at http://dpregister.com/10121395. The general public can access the call by dialing 1-888-338-6515. A replay of the conference call will be available through August 26, 2018 by dialing 1-877-344-7529; using Conference ID: 10121395.
About Univest Corporation of Pennsylvania
Univest Corporation of Pennsylvania (UVSP), including its wholly-owned subsidiary Univest Bank and Trust Co., has approximately $4.7 billion in assets and $3.5 billion in assets under management and supervision through its Wealth Management lines of business at June 30, 2018. Headquartered in Souderton, Pa. and founded in 1876, the Corporation and its subsidiaries provide a full range of financial solutions for individuals, businesses, municipalities and nonprofit organizations in the Mid-Atlantic Region. Univest delivers these services through a network of more than 50 offices in southeastern Pennsylvania extending to the Lehigh Valley and Lancaster, as well as in New Jersey and Maryland and online at www.univest.net.
# # #
This press release of Univest Corporation of Pennsylvania and the reports Univest Corporation of Pennsylvania files with the Securities and Exchange Commission often contain "forward-looking statements" relating to present or future trends or factors affecting the financial services industry and, specifically, the financial operations, markets and products of Univest Corporation of Pennsylvania. These forward-looking statements involve certain risks and uncertainties. There are a number of important factors that could cause Univest Corporation of Pennsylvania’s future results to differ materially from historical performance or projected performance. These factors include, but are not limited to: (1) competitive pressures among financial institutions; (2) changes in the interest rate environment; (3) changes in prepayment speeds, loan sale volumes, charge-offs and loan loss provisions; (4) general economic conditions; (5) legislative or regulatory changes that may adversely affect the businesses in which Univest Corporation of Pennsylvania is engaged; (6) technological issues that 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 (Unaudited) | |||||||||||||||||||||||||||
June 30, 2018 | |||||||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||||||
Balance Sheet (Period End) | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | 6/30/2017 | ||||||||||||||||||||||
Assets | $ | 4,749,181 | $ | 4,613,959 | $ | 4,554,862 | $ | 4,417,363 | $ | 4,453,527 | |||||||||||||||||
Investment securities | 446,933 | 462,252 | 454,082 | 443,822 | 469,307 | ||||||||||||||||||||||
Loans held for sale | 1,778 | 687 | 1,642 | 2,228 | 2,259 | ||||||||||||||||||||||
Loans and leases held for investment, gross | 3,818,398 | 3,689,888 | 3,620,067 | 3,487,164 | 3,510,170 | ||||||||||||||||||||||
Allowance for loan and lease losses | 25,652 | 23,410 | 21,555 | 20,543 | 20,910 | ||||||||||||||||||||||
Loans and leases held for investment, net | 3,792,746 | 3,666,478 | 3,598,512 | 3,466,621 | 3,489,260 | ||||||||||||||||||||||
Total deposits | 3,620,786 | 3,497,293 | 3,554,919 | 3,518,590 | 3,348,080 | ||||||||||||||||||||||
Noninterest-bearing deposits | 1,055,479 | 1,002,021 | 1,040,026 | 987,881 | 963,790 | ||||||||||||||||||||||
NOW, money market and savings | 1,970,912 | 1,974,769 | 1,940,144 | 1,959,549 | 1,837,452 | ||||||||||||||||||||||
Time deposits | 594,395 | 520,503 | 574,749 | 571,160 | 546,838 | ||||||||||||||||||||||
Borrowings | 481,862 | 466,510 | 355,590 | 332,529 | 542,545 | ||||||||||||||||||||||
Shareholders' equity | 605,294 | 606,719 | 603,374 | 528,798 | 521,306 | ||||||||||||||||||||||
Balance Sheet (Average) | For the three months ended, | For the six months ended, | |||||||||||||||||||||||||
6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | 6/30/2017 | 6/30/2018 | 6/30/2017 | |||||||||||||||||||||
Assets | $ | 4,682,827 | $ | 4,555,977 | $ | 4,442,743 | $ | 4,416,332 | $ | 4,333,689 | $ | 4,619,714 | $ | 4,282,343 | |||||||||||||
Investment securities | 450,375 | 457,926 | 456,045 | 459,862 | 468,601 | 454,130 | 469,446 | ||||||||||||||||||||
Loans and leases, gross | 3,743,195 | 3,634,510 | 3,505,260 | 3,467,235 | 3,401,325 | 3,689,152 | 3,354,361 | ||||||||||||||||||||
Deposits | 3,563,956 | 3,484,044 | 3,508,676 | 3,480,318 | 3,346,409 | 3,524,221 | 3,318,502 | ||||||||||||||||||||
Shareholders' equity | 611,667 | 605,973 | 554,071 | 527,032 | 517,697 | 608,835 | 513,399 | ||||||||||||||||||||
Asset Quality Data (Period End) | |||||||||||||||||||||||||||
6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | 6/30/2017 | |||||||||||||||||||||||
Nonaccrual loans and leases, including nonaccrual troubled debt restructured loans and leases | $ | 30,148 | $ | 27,694 | $ | 14,517 | $ | 15,949 | $ | 20,174 | |||||||||||||||||
Accruing loans and leases 90 days or more past due | 150 | 2,295 | 761 | 1,595 | 572 | ||||||||||||||||||||||
Accruing troubled debt restructured loans and leases | 790 | 1,032 | 11,435 | 11,468 | 11,470 | ||||||||||||||||||||||
Total nonperforming loans | 31,088 | 31,021 | 26,713 | 29,012 | 32,216 | ||||||||||||||||||||||
Other real estate owned | 1,742 | 1,843 | 1,843 | 1,763 | 2,202 | ||||||||||||||||||||||
Total nonperforming assets | 32,830 | 32,864 | 28,556 | 30,775 | 34,418 | ||||||||||||||||||||||
Nonaccrual loans and leases / Loans and leases held for investment | 0.79 | % | 0.75 | % | 0.40 | % | 0.46 | % | 0.57 | % | |||||||||||||||||
Nonperforming loans and leases / Loans and leases held for investment | 0.81 | % | 0.84 | % | 0.74 | % | 0.83 | % | 0.92 | % | |||||||||||||||||
Nonperforming assets / Total assets | 0.69 | % | 0.71 | % | 0.63 | % | 0.70 | % | 0.77 | % | |||||||||||||||||
Allowance for loan and lease losses | 25,652 | 23,410 | 21,555 | 20,543 | 20,910 | ||||||||||||||||||||||
Allowance for loan and lease losses / Loans and leases held for investment | 0.67 | % | 0.63 | % | 0.60 | % | 0.59 | % | 0.60 | % | |||||||||||||||||
Allowance for loan and lease losses / Loans and leases held for investment (excluding acquired loans at period-end) | 0.76 | % | 0.73 | % | 0.70 | % | 0.71 | % | 0.73 | % | |||||||||||||||||
Allowance for loan and lease losses / Nonaccrual loans and leases held for investment | 85.09 | % | 84.53 | % | 148.48 | % | 128.80 | % | 103.65 | % | |||||||||||||||||
Allowance for loan and lease losses / Nonperforming loans and leases held for investment | 82.51 | % | 75.47 | % | 80.69 | % | 70.81 | % | 64.91 | % | |||||||||||||||||
Acquired credit impaired loans | $ | 998 | $ | 1,525 | $ | 1,583 | $ | 1,622 | $ | 6,485 | |||||||||||||||||
For the three months ended, | For the six months ended, | ||||||||||||||||||||||||||
6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | 6/30/2017 | 6/30/2018 | 6/30/2017 | |||||||||||||||||||||
Net loan and lease charge-offs | $ | 13,167 | $ | 198 | $ | 980 | $ | 3,056 | $ | 1,384 | $ | 13,365 | $ | 1,800 | |||||||||||||
Net loan and lease charge-offs (annualized)/Average loans and leases | 1.41 | % | 0.02 | % | 0.11 | % | 0.35 | % | 0.16 | % | 0.73 | % | 0.11 | % | |||||||||||||
Univest Corporation of Pennsylvania | |||||||||||||||||||||||||||
Consolidated Selected Financial Data (Unaudited) | |||||||||||||||||||||||||||
June 30, 2018 | |||||||||||||||||||||||||||
(Dollars in thousands, except per share data) | |||||||||||||||||||||||||||
For the three months ended, | For the six months ended, | ||||||||||||||||||||||||||
For the period: | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | 6/30/2017 | 6/30/2018 | 6/30/2017 | ||||||||||||||||||||
Interest income | $ | 46,460 | $ | 43,534 | $ | 42,417 | $ | 42,172 | $ | 40,030 | $ | 89,994 | $ | 78,426 | |||||||||||||
Interest expense | 7,470 | 6,262 | 5,711 | 5,285 | 4,730 | 13,732 | 8,843 | ||||||||||||||||||||
Net interest income | 38,990 | 37,272 | 36,706 | 36,887 | 35,300 | 76,262 | 69,583 | ||||||||||||||||||||
Provision for loan and lease losses | 15,409 | 2,053 | 1,992 | 2,689 | 2,766 | 17,462 | 5,211 | ||||||||||||||||||||
Net interest income after provision | 23,581 | 35,219 | 34,714 | 34,198 | 32,534 | 58,800 | 64,372 | ||||||||||||||||||||
Noninterest income: | |||||||||||||||||||||||||||
Trust fee income | 2,044 | 1,996 | 2,208 | 1,924 | 2,016 | 4,040 | 3,923 | ||||||||||||||||||||
Service charges on deposit accounts | 1,335 | 1,327 | 1,555 | 1,371 | 1,313 | 2,662 | 2,556 | ||||||||||||||||||||
Investment advisory commission and fee income | 3,778 | 3,683 | 3,485 | 3,455 | 3,333 | 7,461 | 6,514 | ||||||||||||||||||||
Insurance commission and fee income | 3,712 | 4,888 | 3,258 | 3,492 | 3,628 | 8,600 | 8,038 | ||||||||||||||||||||
Bank owned life insurance income | 1,210 | 669 | 841 | 742 | 1,622 | 1,879 | 2,405 | ||||||||||||||||||||
Net gain on sales of investment securities | — | 10 | 5 | 7 | 21 | 10 | 36 | ||||||||||||||||||||
Net gain on mortgage banking activities | 942 | 716 | 465 | 908 | 1,537 | 1,658 | 2,650 | ||||||||||||||||||||
Other income | 2,293 | 2,293 | 2,335 | 2,210 | 2,539 | 4,586 | 4,857 | ||||||||||||||||||||
Total noninterest income | 15,314 | 15,582 | 14,152 | 14,109 | 16,009 | 30,896 | 30,979 | ||||||||||||||||||||
Noninterest expense: | |||||||||||||||||||||||||||
Salaries, benefits and commissions | 20,065 | 20,647 | 19,340 | 19,185 | 18,730 | 40,712 | 37,467 | ||||||||||||||||||||
Premises and equipment | 3,600 | 3,780 | 3,636 | 3,542 | 3,715 | 7,380 | 7,373 | ||||||||||||||||||||
Data processing | 2,091 | 2,232 | 2,243 | 2,118 | 2,081 | 4,323 | 4,139 | ||||||||||||||||||||
Professional fees | 1,331 | 1,355 | 1,391 | 1,447 | 1,248 | 2,686 | 2,487 | ||||||||||||||||||||
Marketing and advertising | 526 | 381 | 360 | 271 | 475 | 907 | 854 | ||||||||||||||||||||
Deposit insurance premiums | 452 | 391 | 374 | 409 | 451 | 843 | 853 | ||||||||||||||||||||
Intangible expense | 594 | 612 | 687 | 690 | 446 | 1,206 | 1,205 | ||||||||||||||||||||
Restructuring charges | — | 571 | — | — | — | 571 | — | ||||||||||||||||||||
Other expense | 5,688 | 5,156 | 5,409 | 5,033 | 5,402 | 10,844 | 10,200 | ||||||||||||||||||||
Total noninterest expense | 34,347 | 35,125 | 33,440 | 32,695 | 32,548 | 69,472 | 64,578 | ||||||||||||||||||||
Income before taxes | 4,548 | 15,676 | 15,426 | 15,612 | 15,995 | 20,224 | 30,773 | ||||||||||||||||||||
Income tax expense | 191 | 2,826 | 5,162 | 4,416 | 4,217 | 3,017 | 8,139 | ||||||||||||||||||||
Net income | $ | 4,357 | $ | 12,850 | $ | 10,264 | $ | 11,196 | $ | 11,778 | $ | 17,207 | $ | 22,634 | |||||||||||||
Per common share data: | |||||||||||||||||||||||||||
Book value per share | $ | 20.58 | $ | 20.64 | $ | 20.57 | $ | 19.83 | $ | 19.55 | $ | 20.58 | $ | 19.55 | |||||||||||||
Net income per share: | |||||||||||||||||||||||||||
Basic | $ | 0.15 | $ | 0.44 | $ | 0.37 | $ | 0.42 | $ | 0.44 | $ | 0.59 | $ | 0.85 | |||||||||||||
Diluted | $ | 0.15 | $ | 0.44 | $ | 0.37 | $ | 0.42 | $ | 0.44 | $ | 0.58 | $ | 0.85 | |||||||||||||
Dividends declared per share | $ | 0.20 | $ | 0.20 | $ | 0.20 | $ | 0.20 | $ | 0.20 | $ | 0.40 | $ | 0.40 | |||||||||||||
Weighted average shares outstanding | 29,403,946 | 29,354,887 | 27,481,309 | 26,666,460 | 26,661,784 | 29,379,552 | 26,646,327 | ||||||||||||||||||||
Period end shares outstanding | 29,406,450 | 29,391,934 | 29,334,859 | 26,671,336 | 26,667,991 | 29,406,450 | 26,667,991 | ||||||||||||||||||||
Univest Corporation of Pennsylvania | |||||||||||||||||||||||||||
Consolidated Selected Financial Data (Unaudited) | |||||||||||||||||||||||||||
June 30, 2018 | |||||||||||||||||||||||||||
For the three months ended, | For the six months ended, | ||||||||||||||||||||||||||
Profitability Ratios (annualized) | 6/30/2018 | 3/31/2018 | 12/31/2017 | 9/30/2017 | 6/30/2017 | 6/30/2018 | 6/30/2017 | ||||||||||||||||||||
Return on average assets | 0.37 | % | 1.14 | % | 0.92 | % | 1.01 | % | 1.09 | % | 0.75 | % | 1.07 | % | |||||||||||||
Return on average assets, excluding restructuring charges (1), (2) | 0.37 | % | 1.18 | % | 0.92 | % | 1.01 | % | 1.09 | % | 0.77 | % | 1.07 | % | |||||||||||||
Return on average shareholders' equity | 2.86 | % | 8.60 | % | 7.35 | % | 8.43 | % | 9.13 | % | 5.70 | % | 8.89 | % | |||||||||||||
Return on average shareholder's equity, excluding restructuring charges (1), (2) | 2.86 | % | 8.90 | % | 7.35 | % | 8.43 | % | 9.13 | % | 5.85 | % | 8.89 | % | |||||||||||||
Return on average tangible common equity, excluding restructuring charges (1), (2), (5) | 4.04 | % | 12.65 | % | 10.89 | % | 12.83 | % | 14.06 | % | 8.29 | % | 13.77 | % | |||||||||||||
Net interest margin (FTE) | 3.73 | % | 3.72 | % | 3.76 | % | 3.80 | % | 3.76 | % | 3.72 | % | 3.78 | % | |||||||||||||
Efficiency ratio (3) | 62.12 | % | 65.41 | % | 63.43 | % | 61.94 | % | 60.74 | % | 63.74 | % | 61.70 | % | |||||||||||||
Efficiency ratio, excluding restructuring charges (1), (3), (4) | 62.12 | % | 64.35 | % | 63.43 | % | 61.94 | % | 60.74 | % | 63.22 | % | 61.70 | % | |||||||||||||
Capitalization Ratios | |||||||||||||||||||||||||||
Dividends declared to net income | 135.0 | % | 45.7 | % | 57.1 | % | 47.6 | % | 45.3 | % | 68.3 | % | 47.1 | % | |||||||||||||
Shareholders' equity to assets (Period End) | 12.75 | % | 13.15 | % | 13.25 | % | 11.97 | % | 11.71 | % | 12.75 | % | 11.71 | % | |||||||||||||
Tangible common equity to tangible assets (5) | 9.33 | % | 9.64 | % | 9.68 | % | 8.22 | % | 7.96 | % | 9.33 | % | 7.96 | % | |||||||||||||
Tangible book value per share (5) | $ | 14.51 | $ | 14.54 | $ | 14.44 | $ | 13.06 | $ | 12.75 | $ | 14.51 | $ | 12.75 | |||||||||||||
Tangible book value per share - Core (5), (6) | $ | 14.91 | $ | 14.90 | $ | 14.57 | $ | 13.14 | $ | 12.87 | $ | 14.91 | $ | 12.87 | |||||||||||||
Regulatory Capital Ratios (Period End) | |||||||||||||||||||||||||||
Tier 1 leverage ratio | 10.19 | % | 10.47 | % | 10.48 | % | 8.74 | % | 8.74 | % | 10.19 | % | 8.74 | % | |||||||||||||
Common equity tier 1 risk-based capital ratio | 10.89 | % | 11.16 | % | 11.11 | % | 9.51 | % | 9.21 | % | 10.89 | % | 9.21 | % | |||||||||||||
Tier 1 risk-based capital ratio | 10.89 | % | 11.16 | % | 11.11 | % | 9.51 | % | 9.21 | % | 10.89 | % | 9.21 | % | |||||||||||||
Total risk-based capital ratio | 13.76 | % | 14.04 | % | 14.00 | % | 12.47 | % | 12.15 | % | 13.76 | % | 12.15 | % | |||||||||||||
(1) This consolidated selected financial data schedule contains supplemental financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP”). The management of Univest Corporation of Pennsylvania uses these non-GAAP measures in its analysis of the Corporation's performance. These measures should not be considered a substitute for GAAP basis measures nor should they be viewed as a substitute for operating results determined in accordance with GAAP. Management believes the presentation of the non-GAAP financial measures, which exclude the impact of the specified items, provides useful supplemental information that is essential to a proper understanding of the financial results of the Corporation. See below table for additional information. | |||||||||||||||||||||||||||
(a) Restructuring charges | $ | — | $ | 571 | $ | — | $ | — | $ | — | $ | 571 | $ | — | |||||||||||||
Tax effect on restructuring charges | — | 120 | — | — | — | 120 | — | ||||||||||||||||||||
(b) Restructuring charges, net of tax | $ | — | $ | 451 | $ | — | $ | — | $ | — | $ | 451 | $ | — | |||||||||||||
(2) Net income in this ratio excludes restructuring charges, net of tax. See (1)(b) above. | |||||||||||||||||||||||||||
(3) Noninterest expense to net interest income before loan loss provision plus noninterest income adjusted for tax equivalent income. | |||||||||||||||||||||||||||
(4) Noninterest expense in this ratio excludes restructuring charges. See (1)(a) above. | |||||||||||||||||||||||||||
(5) Tangible equity represents total shareholders' equity less goodwill and other intangible assets, but includes servicing rights which were $6,650 at June 30, 2018, $6,605 at March 31, 2018, $6,573 at December 31, 2017, $6,556 at September 30, 2017 and $6,548 at June 30, 2017. | |||||||||||||||||||||||||||
(6) Tangible equity as defined in (5), excluding the impact of accumulated other comprehensive (loss) income on available-for-sale investment securities, net (($11,987) at June 30, 2018, ($10,477) at March 31, 2018, ($4,061) at December 31, 2017, ($2,364) at September 30, 2017 and ($3,028) at June 30, 2017), divided by total shares outstanding. | |||||||||||||||||||||||||||
N/M Not Meaningful | |||||||||||||||||||||||||||
Univest Corporation of Pennsylvania | |||||||||||||||||||||||
Average Balances and Interest Rates (Unaudited) | |||||||||||||||||||||||
For the Three Months Ended | |||||||||||||||||||||||
Tax Equivalent Basis | June 30, 2018 | March 31, 2018 | |||||||||||||||||||||
Average | Income/ | Average | Average | Income/ | Average | ||||||||||||||||||
(Dollars in thousands) | Balance | Expense | Rate | Balance | Expense | Rate | |||||||||||||||||
Assets: | |||||||||||||||||||||||
Interest-earning deposits with other banks | $ | 37,254 | $ | 148 | 1.59 | % | $ | 19,184 | $ | 76 | 1.61 | % | |||||||||||
U.S. government obligations | 23,183 | 91 | 1.57 | 23,921 | 94 | 1.59 | |||||||||||||||||
Obligations of state and political subdivisions | 71,092 | 603 | 3.40 | 74,554 | 593 | 3.23 | |||||||||||||||||
Other debt and equity securities | 356,100 | 2,177 | 2.45 | 359,451 | 2,095 | 2.36 | |||||||||||||||||
Federal funds sold and other earning assets | 32,788 | 509 | 6.23 | 29,057 | 504 | 7.03 | |||||||||||||||||
Total interest-earning deposits, investments, federal funds sold and other earning assets | 520,417 | 3,528 | 2.72 | 506,167 | 3,362 | 2.69 | |||||||||||||||||
Commercial, financial, and agricultural loans | 810,610 | 9,750 | 4.82 | 782,200 | 8,900 | 4.61 | |||||||||||||||||
Real estate—commercial and construction loans | 1,661,198 | 19,044 | 4.60 | 1,600,394 | 17,618 | 4.46 | |||||||||||||||||
Real estate—residential loans | 853,769 | 10,046 | 4.72 | 837,495 | 9,675 | 4.69 | |||||||||||||||||
Loans to individuals | 28,985 | 444 | 6.14 | 27,960 | 413 | 5.99 | |||||||||||||||||
Municipal loans and leases | 313,181 | 2,961 | 3.79 | 311,752 | 2,892 | 3.76 | |||||||||||||||||
Lease financings | 75,452 | 1,353 | 7.19 | 74,709 | 1,344 | 7.30 | |||||||||||||||||
Gross loans and leases | 3,743,195 | 43,598 | 4.67 | 3,634,510 | 40,842 | 4.56 | |||||||||||||||||
Total interest-earning assets | 4,263,612 | 47,126 | 4.43 | 4,140,677 | 44,204 | 4.33 | |||||||||||||||||
Cash and due from banks | 45,158 | 42,506 | |||||||||||||||||||||
Reserve for loan and lease losses | (23,914 | ) | (22,022 | ) | |||||||||||||||||||
Premises and equipment, net | 61,234 | 61,738 | |||||||||||||||||||||
Other assets | 336,737 | 333,078 | |||||||||||||||||||||
Total assets | $ | 4,682,827 | $ | 4,555,977 | |||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Interest-bearing checking deposits | $ | 463,156 | $ | 383 | 0.33 | $ | 425,027 | $ | 292 | 0.28 | |||||||||||||
Money market savings | 694,734 | 1,758 | 1.01 | 658,367 | 1,343 | 0.83 | |||||||||||||||||
Regular savings | 803,586 | 582 | 0.29 | 834,375 | 557 | 0.27 | |||||||||||||||||
Time deposits | 553,579 | 1,819 | 1.32 | 541,478 | 1,499 | 1.12 | |||||||||||||||||
Total time and interest-bearing deposits | 2,515,055 | 4,542 | 0.72 | 2,459,247 | 3,691 | 0.61 | |||||||||||||||||
Short-term borrowings | 217,327 | 958 | 1.77 | 175,824 | 645 | 1.49 | |||||||||||||||||
Long-term debt | 155,628 | 709 | 1.83 | 155,765 | 665 | 1.73 | |||||||||||||||||
Subordinated notes | 94,420 | 1,261 | 5.36 | 94,359 | 1,261 | 5.42 | |||||||||||||||||
Total borrowings | 467,375 | 2,928 | 2.51 | 425,948 | 2,571 | 2.45 | |||||||||||||||||
Total interest-bearing liabilities | 2,982,430 | 7,470 | 1.00 | 2,885,195 | 6,262 | 0.88 | |||||||||||||||||
Noninterest-bearing deposits | 1,048,901 | 1,024,797 | |||||||||||||||||||||
Accrued expenses and other liabilities | 39,829 | 40,012 | |||||||||||||||||||||
Total liabilities | 4,071,160 | 3,950,004 | |||||||||||||||||||||
Shareholders' Equity: | |||||||||||||||||||||||
Common stock | 157,784 | 157,784 | |||||||||||||||||||||
Additional paid-in capital | 290,517 | 290,209 | |||||||||||||||||||||
Retained earnings and other equity | 163,366 | 157,980 | |||||||||||||||||||||
Total shareholders' equity | 611,667 | 605,973 | |||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 4,682,827 | $ | 4,555,977 | |||||||||||||||||||
Net interest income | $ | 39,656 | $ | 37,942 | |||||||||||||||||||
Net interest spread | 3.43 | 3.45 | |||||||||||||||||||||
Effect of net interest-free funding sources | 0.30 | 0.27 | |||||||||||||||||||||
Net interest margin | 3.73 | % | 3.72 | % | |||||||||||||||||||
Ratio of average interest-earning assets to average interest-bearing liabilities | 142.96 | % | 143.51 | % | |||||||||||||||||||
Note 1: In the above schedule, the interest income and net interest income analysis contains tax-equivalent financial information and measures determined | |||||||||||||||||||||||
by methods other than in accordance with U.S. GAAP. This financial information and measures should not be considered a substitute for GAAP basis | |||||||||||||||||||||||
financial information and measures. Management believes the presentation of the non-GAAP financial information and measures provides useful | |||||||||||||||||||||||
information that is essential to a proper understanding of the financial results of the Corporation. | |||||||||||||||||||||||
Note 2: For rate calculation purposes, average loan and lease categories include deferred fees and costs, purchase accounting adjustments and | |||||||||||||||||||||||
unearned discount. | |||||||||||||||||||||||
Nonaccrual loans and leases have been included in the average loan and lease balances. | |||||||||||||||||||||||
Loans held for sale have been included in the average loan balances. | |||||||||||||||||||||||
Tax-equivalent amounts for the three months ended June 30, 2018 and March 31, 2018 have been calculated using the Corporation’s federal applicable rate of 21.0%. | |||||||||||||||||||||||
Univest Corporation of Pennsylvania | |||||||||||||||||||||||
Average Balances and Interest Rates (Unaudited) | |||||||||||||||||||||||
For the Three Months Ended June 30, | |||||||||||||||||||||||
Tax Equivalent Basis | 2018 | 2017 | |||||||||||||||||||||
Average | Income/ | Average | Average | Income/ | Average | ||||||||||||||||||
(Dollars in thousands) | Balance | Expense | Rate | Balance | Expense | Rate | |||||||||||||||||
Assets: | |||||||||||||||||||||||
Interest-earning deposits with other banks | $ | 37,254 | $ | 148 | 1.59 | % | $ | 17,951 | $ | 39 | 0.87 | % | |||||||||||
U.S. government obligations | 23,183 | 91 | 1.57 | 33,453 | 113 | 1.35 | |||||||||||||||||
Obligations of state and political subdivisions | 71,092 | 603 | 3.40 | 83,356 | 886 | 4.26 | |||||||||||||||||
Other debt and equity securities | 356,100 | 2,177 | 2.45 | 351,792 | 1,720 | 1.96 | |||||||||||||||||
Federal funds sold and other earning assets | 32,788 | 509 | 6.23 | 29,860 | 396 | 5.32 | |||||||||||||||||
Total interest-earning deposits, investments, federal funds sold and other earning assets | 520,417 | 3,528 | 2.72 | 516,412 | 3,154 | 2.45 | |||||||||||||||||
Commercial, financial, and agricultural loans | 810,610 | 9,750 | 4.82 | 761,544 | 8,172 | 4.30 | |||||||||||||||||
Real estate—commercial and construction loans | 1,661,198 | 19,044 | 4.60 | 1,501,258 | 16,629 | 4.44 | |||||||||||||||||
Real estate—residential loans | 853,769 | 10,046 | 4.72 | 750,149 | 8,479 | 4.53 | |||||||||||||||||
Loans to individuals | 28,985 | 444 | 6.14 | 27,850 | 406 | 5.85 | |||||||||||||||||
Municipal loans and leases | 313,181 | 2,961 | 3.79 | 283,129 | 3,185 | 4.51 | |||||||||||||||||
Lease financings | 75,452 | 1,353 | 7.19 | 77,395 | 1,416 | 7.34 | |||||||||||||||||
Gross loans and leases | 3,743,195 | 43,598 | 4.67 | 3,401,325 | 38,287 | 4.51 | |||||||||||||||||
Total interest-earning assets | 4,263,612 | 47,126 | 4.43 | 3,917,737 | 41,441 | 4.24 | |||||||||||||||||
Cash and due from banks | 45,158 | 43,804 | |||||||||||||||||||||
Reserve for loan and lease losses | (23,914 | ) | (20,474 | ) | |||||||||||||||||||
Premises and equipment, net | 61,234 | 65,690 | |||||||||||||||||||||
Other assets | 336,737 | 326,932 | |||||||||||||||||||||
Total assets | $ | 4,682,827 | $ | 4,333,689 | |||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Interest-bearing checking deposits | $ | 463,156 | $ | 383 | 0.33 | $ | 445,830 | $ | 118 | 0.11 | |||||||||||||
Money market savings | 694,734 | 1,758 | 1.01 | 560,350 | 694 | 0.50 | |||||||||||||||||
Regular savings | 803,586 | 582 | 0.29 | 835,495 | 446 | 0.21 | |||||||||||||||||
Time deposits | 553,579 | 1,819 | 1.32 | 547,115 | 1,203 | 0.88 | |||||||||||||||||
Total time and interest-bearing deposits | 2,515,055 | 4,542 | 0.72 | 2,388,790 | 2,461 | 0.41 | |||||||||||||||||
Short-term borrowings | 217,327 | 958 | 1.77 | 139,146 | 325 | 0.94 | |||||||||||||||||
Long-term debt | 155,628 | 709 | 1.83 | 200,207 | 683 | 1.37 | |||||||||||||||||
Subordinated notes | 94,420 | 1,261 | 5.36 | 94,176 | 1,261 | 5.37 | |||||||||||||||||
Total borrowings | 467,375 | 2,928 | 2.51 | 433,529 | 2,269 | 2.10 | |||||||||||||||||
Total interest-bearing liabilities | 2,982,430 | 7,470 | 1.00 | 2,822,319 | 4,730 | 0.67 | |||||||||||||||||
Noninterest-bearing deposits | 1,048,901 | 957,619 | |||||||||||||||||||||
Accrued expenses and other liabilities | 39,829 | 36,054 | |||||||||||||||||||||
Total liabilities | 4,071,160 | 3,815,992 | |||||||||||||||||||||
Shareholders' Equity: | |||||||||||||||||||||||
Common stock | 157,784 | 144,559 | |||||||||||||||||||||
Additional paid-in capital | 290,517 | 230,683 | |||||||||||||||||||||
Retained earnings and other equity | 163,366 | 142,455 | |||||||||||||||||||||
Total shareholders' equity | 611,667 | 517,697 | |||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 4,682,827 | $ | 4,333,689 | |||||||||||||||||||
Net interest income | $ | 39,656 | $ | 36,711 | |||||||||||||||||||
Net interest spread | 3.43 | 3.57 | |||||||||||||||||||||
Effect of net interest-free funding sources | 0.30 | 0.19 | |||||||||||||||||||||
Net interest margin | 3.73 | % | 3.76 | % | |||||||||||||||||||
Ratio of average interest-earning assets to average interest-bearing liabilities | 142.96 | % | 138.81 | % | |||||||||||||||||||
Note 1: In the above schedule, the interest income and net interest income analysis contains tax-equivalent financial information and measures determined | |||||||||||||||||||||||
by methods other than in accordance with U.S. GAAP. This financial information and measures should not be considered a substitute for GAAP basis | |||||||||||||||||||||||
financial information and measures. Management believes the presentation of the non-GAAP financial information and measures provides useful | |||||||||||||||||||||||
information that is essential to a proper understanding of the financial results of the Corporation. | |||||||||||||||||||||||
Note 2: For rate calculation purposes, average loan and lease categories include deferred fees and costs, purchase accounting adjustments and | |||||||||||||||||||||||
unearned discount. | |||||||||||||||||||||||
Nonaccrual loans and leases have been included in the average loan and lease balances. | |||||||||||||||||||||||
Loans held for sale have been included in the average loan balances. | |||||||||||||||||||||||
Tax-equivalent amounts for the three months ended June 30, 2018 and 2017 have been calculated using the Corporation’s federal applicable rate of 21.0% and 35.0%, respectively. | |||||||||||||||||||||||
Univest Corporation of Pennsylvania | |||||||||||||||||||||||
Average Balances and Interest Rates (Unaudited) | |||||||||||||||||||||||
For the Six Months Ended June 30, | |||||||||||||||||||||||
Tax Equivalent Basis | 2018 | 2017 | |||||||||||||||||||||
Average | Income/ | Average | Average | Income/ | Average | ||||||||||||||||||
(Dollars in thousands) | Balance | Expense | Rate | Balance | Expense | Rate | |||||||||||||||||
Assets: | |||||||||||||||||||||||
Interest-earning deposits with other banks | $ | 28,269 | $ | 224 | 1.60 | % | $ | 13,297 | $ | 55 | 0.83 | % | |||||||||||
U.S. government obligations | 23,550 | 185 | 1.58 | 33,744 | 219 | 1.31 | |||||||||||||||||
Obligations of state and political subdivisions | 72,814 | 1,196 | 3.31 | 84,598 | 1,808 | 4.31 | |||||||||||||||||
Other debt and equity securities | 357,766 | 4,272 | 2.41 | 351,104 | 3,302 | 1.90 | |||||||||||||||||
Federal funds sold and other earning assets | 30,933 | 1,013 | 6.60 | 27,896 | 754 | 5.45 | |||||||||||||||||
Total interest-earning deposits, investments, federal funds sold and other earning assets | 513,332 | 6,890 | 2.71 | 510,639 | 6,138 | 2.42 | |||||||||||||||||
Commercial, financial, and agricultural loans | 796,483 | 18,650 | 4.72 | 741,409 | 16,013 | 4.36 | |||||||||||||||||
Real estate—commercial and construction loans | 1,630,964 | 36,662 | 4.53 | 1,480,757 | 32,369 | 4.41 | |||||||||||||||||
Real estate—residential loans | 845,677 | 19,721 | 4.70 | 744,213 | 16,715 | 4.53 | |||||||||||||||||
Loans to individuals | 28,475 | 857 | 6.07 | 28,707 | 806 | 5.66 | |||||||||||||||||
Municipal loans and leases | 312,470 | 5,853 | 3.78 | 281,264 | 6,305 | 4.52 | |||||||||||||||||
Lease financings | 75,083 | 2,697 | 7.24 | 78,011 | 2,899 | 7.49 | |||||||||||||||||
Gross loans and leases | 3,689,152 | 84,440 | 4.62 | 3,354,361 | 75,107 | 4.52 | |||||||||||||||||
Total interest-earning assets | 4,202,484 | 91,330 | 4.38 | 3,865,000 | 81,245 | 4.24 | |||||||||||||||||
Cash and due from banks | 43,839 | 42,878 | |||||||||||||||||||||
Reserve for loan and lease losses | (22,973 | ) | (19,344 | ) | |||||||||||||||||||
Premises and equipment, net | 61,485 | 65,102 | |||||||||||||||||||||
Other assets | 334,879 | 328,707 | |||||||||||||||||||||
Total assets | $ | 4,619,714 | $ | 4,282,343 | |||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Interest-bearing checking deposits | $ | 444,197 | $ | 675 | 0.31 | $ | 436,155 | $ | 223 | 0.10 | |||||||||||||
Money market savings | 676,651 | 3,101 | 0.92 | 546,083 | 1,257 | 0.46 | |||||||||||||||||
Regular savings | 818,895 | 1,139 | 0.28 | 821,725 | 795 | 0.20 | |||||||||||||||||
Time deposits | 547,562 | 3,318 | 1.22 | 569,341 | 2,377 | 0.84 | |||||||||||||||||
Total time and interest-bearing deposits | 2,487,305 | 8,233 | 0.67 | 2,373,304 | 4,652 | 0.40 | |||||||||||||||||
Short-term borrowings | 196,690 | 1,603 | 1.64 | 144,620 | 587 | 0.82 | |||||||||||||||||
Long-term debt | 155,697 | 1,374 | 1.78 | 174,263 | 1,082 | 1.25 | |||||||||||||||||
Subordinated notes | 94,390 | 2,522 | 5.39 | 94,146 | 2,522 | 5.40 | |||||||||||||||||
Total borrowings | 446,777 | 5,499 | 2.48 | 413,029 | 4,191 | 2.05 | |||||||||||||||||
Total interest-bearing liabilities | 2,934,082 | 13,732 | 0.94 | 2,786,333 | 8,843 | 0.64 | |||||||||||||||||
Noninterest-bearing deposits | 1,036,916 | 945,198 | |||||||||||||||||||||
Accrued expenses and other liabilities | 39,881 | 37,413 | |||||||||||||||||||||
Total liabilities | 4,010,879 | 3,768,944 | |||||||||||||||||||||
Shareholders' Equity: | |||||||||||||||||||||||
Common stock | 157,784 | 144,559 | |||||||||||||||||||||
Additional paid-in capital | 290,363 | 230,395 | |||||||||||||||||||||
Retained earnings and other equity | 160,688 | 138,445 | |||||||||||||||||||||
Total shareholders' equity | 608,835 | 513,399 | |||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 4,619,714 | $ | 4,282,343 | |||||||||||||||||||
Net interest income | $ | 77,598 | $ | 72,402 | |||||||||||||||||||
Net interest spread | 3.44 | 3.60 | |||||||||||||||||||||
Effect of net interest-free funding sources | 0.28 | 0.18 | |||||||||||||||||||||
Net interest margin | 3.72 | % | 3.78 | % | |||||||||||||||||||
Ratio of average interest-earning assets to average interest-bearing liabilities | 143.23 | % | 138.71 | % | |||||||||||||||||||
Note 1: In the above schedule, the interest income and net interest income analysis contains tax-equivalent financial information and measures determined | |||||||||||||||||||||||
by methods other than in accordance with U.S. GAAP. This financial information and measures should not be considered a substitute for GAAP basis | |||||||||||||||||||||||
financial information and measures. Management believes the presentation of the non-GAAP financial information and measures provides useful | |||||||||||||||||||||||
information that is essential to a proper understanding of the financial results of the Corporation. | |||||||||||||||||||||||
Note 2: For rate calculation purposes, average loan and lease categories include deferred fees and costs, purchase accounting adjustments and | |||||||||||||||||||||||
unearned discount. | |||||||||||||||||||||||
Nonaccrual loans and leases have been included in the average loan and lease balances. | |||||||||||||||||||||||
Loans held for sale have been included in the average loan balances. | |||||||||||||||||||||||
Tax-equivalent amounts for the six months ended June 30, 2018 and 2017 have been calculated using the Corporation’s federal applicable rate of 21.0% and 35.0%, respectively. | |||||||||||||||||||||||