Univest Financial (UVSP) 8-K Results of Operations and Financial Condition

Exhibit 99.1

NEWS

CONTACT:     Mike Keim

President, Univest Bank and Trust Co.

Chief Financial Officer, Univest Corporation of Pennsylvania                    

215-721-2511, keimm@univest.net

FOR IMMEDIATE RELEASE

UNIVEST CORPORATION OF PENNSYLVANIA - UNIVEST

BANK AND TRUST CO. - REPORTS FOURTH QUARTER AND YEAR END EARNINGS

SOUDERTON, Pa., January 27, 2016 - Univest Corporation of Pennsylvania (“Univest” or "Corporation") (NASDAQ: UVSP), parent company of Univest Bank and Trust Co. ("Bank") and its insurance, investments and equipment financing subsidiaries, today announced financial results for the quarter and year ended December 31, 2015. Univest reported net income of $7.2 million or $0.37 diluted earnings per share for the quarter ended December 31, 2015, a 38% increase from reported net income of $5.2 million or $0.32 diluted earnings per share for the quarter ended December 31, 2014. Net income for the year ended December 31, 2015 was $27.3 million or $1.39 diluted earnings per share, a 23% increase in net income compared to $22.2 million or $1.37 diluted earnings per share for the comparable period in the prior year. The quarter and year-to-date financial results include the Valley Green Bank acquisition which Univest completed on January 1, 2015 and now operates as Valley Green Bank, a Division of the Bank (“Valley Green Bank”). The results for the year ended December 31, 2015 included $2.0 million of integration and acquisition-related costs associated with Valley Green Bank, incurred during the first and second quarters, or $0.07 diluted earnings per share on a year-to-date tax affected basis. The fourth quarter and year-to-date results also include $540 thousand of acquisition-related costs associated with the pending acquisition of Fox Chase Bancorp, or $0.03 diluted earnings per share on a tax affected basis. Lastly, the results for the year ended December 31, 2015 also included $1.6 million of restructuring charges incurred in the second quarter, related to the consolidation of six financial centers in September 2015 under the Bank's optimization plan or $0.05 diluted earnings per share on a tax affected basis. Excluding these costs, net income for the year ended December 31, 2015, would have been $30.1 million or $1.54 diluted earnings per share.

Loans

Gross loans and leases increased $552.4 million from December 31, 2014, including $380.9 million of loans acquired from Valley Green Bank. Organic loan growth was 11% from December 31, 2014. The growth in loans was primarily in commercial real estate loans and residential real estate loans. Gross loans and leases increased$81.2 million from September 30, 2015 mainly due to growth in commercial business loans, commercial real estate loans and residential real estate loans. Organic loan growth was 4% (15% annualized) from September 30, 2015. The growth in loans during the year resulted from new and existing customer relationships as economic conditions continue to improve while interest rates remain at historical lows, lending team additions and market disruption created by other bank acquisitions.

Deposits

Total deposits increased $533.0 millionfrom December 31, 2014, primarily due to $385.9 million of deposits acquired from Valley Green Bank and an increase in public funds.

Borrowings

Borrowings at December 31, 2015 included $50 million in aggregate principal amount fixed-to-floating rate subordinated notes issued in a private placement transaction to institutional accredited investors completed on March 30, 2015. The subordinated notes have a five-year, fixed rate of 5.10% and thereafter a rate of three-month LIBOR plus 3.544%, until the maturity date of March 30, 2025 or any early redemption date.

Net Interest Income and Margin

Net interest income increased$5.4 million to $23.3 million for the fourth quarter of 2015 from the same period in 2014. Net interest income increased $21.5 million for the year ended December 31, 2015 from the prior year. The net interest margin on a tax-equivalent basis for the fourth quarter of 2015 was 3.80%, compared to 3.89% for the third quarter of 2015 and 3.78% for the fourth quarter of 2014. The net interest margin in the fourth quarter was impacted by excess cash (3 basis points) as the Bank grew deposits in advance of anticipated loan growth. For the year, the net interest margin on a tax-equivalent basis was 3.96% compared to 3.87% in 2014. The increase in net interest income during 2015 was mainly due to the impact of the Valley Green Bank acquisition, which included the average net interest-earning assets acquired and the net accretion of acquisition accounting fair value adjustments (the impact of the acquisition accounting adjustments was four basis points for the fourth quarter of 2015 and nine basis points for the year ended December 31, 2015). The subordinated debt issuance increased funding costs by 14 basis points in the fourth quarter of 2015 and 10 basis points for the year ended December 31, 2015 from the comparable periods in the prior year.

Non-Interest Income

Non-interest income for the quarter ended December 31, 2015 was $13.3 million, an increase of $1.2 million or 10% from the fourth quarter of 2014. Non-interest income for the year ended December 31, 2015 was $52.9 million, an increase of $4.3 million or 9% from the prior year. Insurance commission and fee income increased $2.3 million for the year ended December 31, 2015, primarily due to the acquisition of Sterner Insurance on July 1, 2014. The net gain on mortgage banking activities increased $392 thousand for the quarter and $2.7 million for the year ended December 31, 2015, mainly due to an increase in purchase volume. Funded first mortgage volume for the quarter increased $4.8 million or 11%, and $72.5 million or 55% for the year ended December 31, 2015, compared to the same periods in 2014. In addition, the net gain on sales of investment securities increased $619 thousand for the quarter and $630 thousand for the year ended December 31, 2015. The increase in net gains on sales of investment securities is attributable to the Corporation's disciplined approach to evaluating market conditions for potential sales and timing of reinvestment. These favorable increases were partially offset by a decline in investment advisory commission and fee income of $1.1 million for the year ended December 31, 2015, primarily related to the fourth quarter of 2014 divestiture of approximately $375 million in marginally profitable assets under the supervision of independent consultants.

Non-Interest Expense

Non-interest expense for the quarter ended December 31, 2015 was $26.0 million, an increase of $3.5 million or 15%, compared to the fourth quarter of 2014. Non-interest expense for the year ended December 31, 2015 was $105.5 million, an increase of $18.3 million or 21% from the prior year. Non-interest expense was impacted by the Valley Green Bank acquisition which included integration and acquisition-related costs totaling $2.0 million for the year ended December 31, 2015 and $540 thousand in acquisition-related charges associated with the pending acquisition of Fox Chase Bancorp. Salaries and benefit expense increased $2.5 million for the quarter and $7.8 million for the year ended December 31, 2015, primarily attributable to the Valley Green Bank acquisition, additional staff hired to support revenue generation, increased pension plan expense and bonus accruals. The Sterner Insurance acquisition also impacted year-to-date salaries and benefits expense. This increase was partially offset by higher deferred loan origination costs. Premises and equipment expenses increased $529 thousand for the quarter and $2.9 million for the year ended December 31, 2015, mainly due to the Valley Green Bank acquisition and increased investments in computer equipment and software.

In addition, non-interest expense for the year ended December 31, 2015 included restructuring charges of $1.6 millionrecognized during the second quarter related to the consolidation of six financial centers in September 2015 under the Bank's optimization plan. The projected annualized savings from these consolidations is $1.9 million.

Asset Quality and Provision for Loan and Lease Losses

Non-accrual loans and leases, including non-accrual troubled debt restructured loans, were $14.2 million at December 31, 2015 compared to $20.8 million at September 30, 2015 and $17.3 million at December 31, 2014. During the fourth quarter of 2015, two non-accrual construction loans in loans held for sale were sold at their carrying amounts for $4.0 million in accordance with the agreement entered into during the second quarter of 2015. Net loan and lease charge-offs were $1.9 million during the fourth quarter of 2015 compared to $1.7 million for the fourth quarter of 2014. Net loan and lease charge-offs were $6.8 millionfor the year ended December 31, 2015 compared to $7.4 million in the prior year. Non-accrual loans and leases as a percentage of total loans and leases (held for investment and nonaccrual loans held for sale) were 0.65% at December 31, 2015 compared to 0.99%at September 30, 2015 and 1.07% at December 31, 2014. The provision for loan and lease losses was $917 thousand for the fourth quarter of 2015, compared to $648 thousand for the fourth quarter of 2014. The provision for loan and leases losses was $3.8 million for the year ended December 31, 2015, compared to $3.6 million in the prior year.

The allowance for loan and lease losses as a percentage of loans and leases held for investment was 0.81% at December 31, 2015, compared to 0.89% at September 30, 2015and 1.27% at December 31, 2014. At December 31, 2015, the allowance for loan and lease losses as a percentage of loans and leases held for investment, excluding loans acquired in the Valley Green Bank acquisition which were recorded at fair value as of the acquisition date, was 0.94%. The allowance for loan and lease losses to nonaccrual loans and leases held for investment equaled 124.29% at December 31, 2015, compared to 110.58%at September 30, 2015 and 119.18% at December 31, 2014.

Capital

Univest continues to remain well-capitalized at December 31, 2015. Univest adopted the new Basel III regulatory capital rules during the first quarter of 2015 under the transition rules. Total risk-based capital at December 31, 2015 under Basel III was 13.32%, well in excess of the regulatory minimum for well-capitalized status of 10%.

Dividend

On November 25, 2015, Univest declared a quarterly cash dividend of $0.20 per share, payable on January 4, 2016. This represented a 3.91% 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 fourth quarter and full year 2015 results on Thursday, January 28, 2016 at 9:00 am EST. The general public can access the call by dialing 1-888-317-6016. A replay of the

conference call will be available through February 28, 2016 by dialing 1-877-344-7529; using Conference ID: 10079280. Participants may preregister at http://dpregister.com/10079280.

About Univest Corporation of Pennsylvania

Univest Corporation of Pennsylvania (UVSP), including its wholly-owned subsidiary, Univest Bank and Trust Co., has $2.9 billion in assets and $3.0 billion in assets under management and supervision through its Wealth Management lines of business. 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, 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) 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
December 31, 2015
(Dollars in thousands)
Balance Sheet (Period End)	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014
Assets	$	2,879,451		$	2,851,568		$	2,780,578		$	2,757,495		$	2,235,321
Investment securities	370,760			374,558			374,711			380,484			368,630
Loans held for sale	4,680			9,151			8,831			5,479			3,302
Loans and leases held for investment, gross	2,179,013			2,097,807			2,107,857			2,043,840			1,626,625
Allowance for loan and lease losses	17,628			18,620			19,602			20,934			20,662
Loans and leases held for investment, net	2,161,385			2,079,187			2,088,255			2,022,906			1,605,963
Total deposits	2,394,360			2,372,865			2,263,025			2,254,834			1,861,341
Noninterest-bearing deposits	541,460			519,767			519,026			509,183			449,339
NOW, money market and savings	1,398,494			1,361,827			1,288,318			1,293,165			1,159,409
Time deposits	454,406			491,271			455,681			452,486			252,593
Borrowings	73,588			70,531			110,480			91,423			41,974
Shareholders' equity	361,574			359,109			356,186			360,394			284,554
Balance Sheet (Average)	For the three months ended,															For the twelve months ended,
	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014			12/31/2015			12/31/2014
Assets	$	2,866,848		$	2,804,578		$	2,739,968		$	2,691,513		$	2,239,015		$	2,776,283		$	2,202,247
Investment securities	370,163			368,837			375,887			381,008			363,567			373,930			372,752
Loans and leases, gross	2,132,922			2,098,007			2,067,120			2,023,835			1,607,918			2,080,817			1,580,835
Deposits	2,393,655			2,325,049			2,242,217			2,237,830			1,875,938			2,300,184			1,844,988
Shareholders' equity	360,521			357,150			359,154			362,125			291,547			359,725			287,038
Asset Quality Data (Period End)
	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014
Nonaccrual loans and leases, including nonaccrual troubled debt restructured loans and leases and nonaccrual loans held for sale	$	14,183		$	20,838		$	17,697		$	18,604		$	17,337
Accruing loans and leases 90 days or more past due	379			428			287			1,063			451
Accruing troubled debt restructured loans and leases	5,245			4,789			6,099			5,341			5,469
Other real estate owned	1,276			955			955			955			955
Nonperforming assets	21,083			27,010			25,038			25,963			24,212
Allowance for loan and lease losses	17,628			18,620			19,602			20,934			20,662
Nonaccrual loans and leases / Loans and leases held for investment and nonaccrual loans held for sale	0.65		%	0.99		%	0.84		%	0.91		%	1.07		%
Nonperforming loans and leases / Loans and leases held for investment and nonaccrual loans held for sale	0.91		%	1.24		%	1.14		%	1.22		%	1.43		%
Allowance for loan and lease losses / Loans and leases held for investment	0.81		%	0.89		%	0.93		%	1.02		%	1.27		%
Allowance for loan and lease losses/Loans and leases held for investment (excluding acquired loans at period-end)	0.94		%	1.06		%	1.12		%	1.26		%	1.27		%
Allowance for loan and lease losses / Nonaccrual loans and leases held for investment	124.29		%	110.58		%	143.11		%	112.52		%	119.18		%
Allowance for loan and lease losses / Nonperforming loans and leases held for investment	89.00		%	84.43		%	97.60		%	83.71		%	88.84		%
Acquired credit impaired loans	$	1,253		$	1,379		$	1,876		$	1,631		$	—
	For the three months ended,															For the twelve months ended,
	12/31/2015			9/30/2015			6/30/2015			3/31/2015			12/31/2014			12/31/2015			12/31/2014
Net loan and lease charge-offs	$	1,909		$	1,652		$	2,473		$	802		$	1,748		$	6,836		$	7,439
Net loan and lease charge-offs (annualized)/Average loans and leases	0.36		%	0.31		%	0.48		%	0.16		%	0.43		%	0.33		%	0.47		%

Univest Corporation of Pennsylvania
Consolidated Selected Financial Data
December 31, 2015
(Dollars in thousands, except per share data)
	For the three months ended,										For the twelve months ended,
For the period:	12/31/2015		9/30/2015		6/30/2015		3/31/2015		12/31/2014		12/31/2015		12/31/2014
Interest income	$	25,623	$	25,585	$	25,513	$	24,738	$	18,995	$	101,459	$	75,885
Interest expense	2,278		2,220		2,133		1,434		1,039		8,065		3,996
Net interest income	23,345		23,365		23,380		23,304		17,956		93,394		71,889
Provision for loan and lease losses	917		670		1,141		1,074		648		3,802		3,607
Net interest income after provision	22,428		22,695		22,239		22,230		17,308		89,592		68,282
Noninterest income:
Trust fee income	2,030		1,904		2,154		1,820		2,143		7,908		7,835
Service charges on deposit accounts	1,059		1,069		1,039		1,063		1,096		4,230		4,230
Investment advisory commission and fee income	2,583		2,687		2,740		2,763		2,760		10,773		11,904
Insurance commission and fee income	3,073		3,232		3,434		4,146		2,896		13,885		11,543
Bank owned life insurance income	425		306		211		353		461		1,295		1,628
Net gain on sales of investment securities	697		296		181		91		78		1,265		635
Net gain on mortgage banking activities	1,090		1,123		1,367		1,258		698		4,838		2,182
Net gain on sales of other real estate owned	—		14		—		—		—		14		195
Other income	2,355		2,224		2,225		1,937		1,944		8,741		8,499
Total noninterest income	13,312		12,855		13,351		13,431		12,076		52,949		48,651
Noninterest expense:
Salaries and benefits	12,828		11,970		11,957		13,314		10,297		50,069		42,245
Commissions	1,894		2,174		2,155		1,814		2,052		8,037		7,637
Premises and equipment	3,897		3,924		3,743		4,047		3,368		15,611		12,668
Professional fees	870		1,096		1,066		807		765		3,839		3,164
Intangible expense	178		710		893		786		405		2,567		2,167
Acquisition-related costs	540		—		41		466		531		1,047		1,270
Integration costs	6		—		110		1,374		—		1,490		8
Restructuring charges	—		—		1,642		—		—		1,642		—
Other expense	5,816		5,369		5,225		4,803		5,144		21,213		18,095
Total noninterest expense	26,029		25,243		26,832		27,411		22,562		105,515		87,254
Income before taxes	9,711		10,307		8,758		8,250		6,822		37,026		29,679
Income taxes	2,553		2,779		2,292		2,134		1,632		9,758		7,448
Net income	$	7,158	$	7,528	$	6,466	$	6,116	$	5,190	$	27,268	$	22,231
Per common share data:
Book value per share	$	18.51	$	18.41	$	18.21	$	18.18	$	17.54	$	18.51	$	17.54
Net income per share:
Basic	$	0.37	$	0.39	$	0.33	$	0.31	$	0.32	$	1.39	$	1.37
Diluted	$	0.37	$	0.39	$	0.33	$	0.31	$	0.32	$	1.39	$	1.37
Dividends declared per share	$	0.20	$	0.20	$	0.20	$	0.20	$	0.20	$	0.80	$	0.80
Weighted average shares outstanding	19,525,701		19,506,609		19,675,002		19,951,242		16,215,580		19,663,039		16,234,959
Period end shares outstanding	19,530,930		19,502,613		19,559,941		19,820,824		16,221,607		19,530,930		16,221,607

Univest Corporation of Pennsylvania
Consolidated Selected Financial Data
December 31, 2015
	For the three months ended,										For the twelve months ended,
Profitability Ratios (annualized)	12/31/2015		9/30/2015		6/30/2015		3/31/2015		12/31/2014		12/31/2015		12/31/2014
Return on average assets	0.99	%	1.06	%	0.95	%	0.92	%	0.92	%	0.98	%	1.01	%
Return on average assets, excluding integration and acquisition-related costs and restructuring charges	1.06	%	1.06	%	1.12	%	1.10	%	1.01	%	1.09	%	1.06	%
Return on average shareholders' equity	7.88	%	8.36	%	7.22	%	6.85	%	7.06	%	7.58	%	7.74	%
Return on average shareholder's equity, excluding integration and acquisition-related costs and restructuring charges	8.42	%	8.36	%	8.52	%	8.19	%	7.78	%	8.38	%	8.11	%
Return on average tangible common equity, excluding integration and acquisition-related costs and restructuring charges	12.92	%	12.91	%	13.12	%	12.48	%	10.73	%	12.86	%	11.12	%
Net interest margin (FTE)	3.80	%	3.89	%	4.03	%	4.12	%	3.78	%	3.96	%	3.87	%
Efficiency ratio (1)	68.10	%	66.96	%	70.29	%	71.68	%	71.46	%	69.27	%	69.01	%
Efficiency ratio (1), excluding integration and acquisition-related costs and restructuring charges	66.67	%	66.96	%	65.60	%	66.87	%	69.78	%	66.52	%	68.00	%
Capitalization Ratios
Dividends declared to net income	54.08	%	51.79	%	60.49	%	65.26	%	62.49	%	57.35	%	58.40	%
Shareholders' equity to assets (Period End)	12.56	%	12.59	%	12.81	%	13.07	%	12.73	%	12.56	%	12.73	%
Tangible common equity to tangible assets	8.58	%	8.56	%	8.67	%	8.91	%	9.49	%	8.58	%	9.49	%
Regulatory Capital Ratios (Period End) (2)
Tier 1 leverage ratio	9.69	%	9.75	%	9.89	%	10.16	%	10.55	%	9.69	%	10.55	%
Common equity tier 1 risk-based capital ratio	10.63	%	10.85	%	10.77	%	11.09	%	—		10.63	%	—	%
Tier 1 risk-based capital ratio	10.63	%	10.85	%	10.77	%	11.09	%	11.79	%	10.63	%	11.79	%
Total risk-based capital ratio	13.32	%	13.69	%	13.65	%	14.09	%	12.91	%	13.32	%	12.91	%
(1) Total operating expenses to net interest income before loan loss provision plus non-interest income adjusted for tax equivalent income.
(2) Ratios for 2015 are reported under BASEL III regulatory capital rules. On January 1, 2015, the BASEL III rules became effective, subject to transition provisions primarily relating to regulatory deductions and adjustments impacting common equity tier 1 capital and tier 1 capital, to be phased in over a three-year period beginning January 1, 2015. Ratios for 2014 are reported under BASEL I.

Distribution of Assets, Liabilities and Shareholders' Equity: Interest Rates and Interest Differential
	For the Three Months Ended December 31,
Tax Equivalent Basis	2015							2014
	Average			Income/		Average		Average			Income/		Average
(Dollars in thousands)	Balance			Expense		Rate		Balance			Expense		Rate
Assets:
Interest-earning deposits with other banks	$	75,782		$	58	0.30	%	$	48,393		$	32	0.26	%
U.S. government obligations	105,635			300		1.13		127,561			320		1.00
Obligations of state and political subdivisions	105,415			1,292		4.86		103,682			1,365		5.22
Other debt and equity securities	159,113			1,029		2.57		132,324			644		1.93
Total interest-earning deposits and investments	445,945			2,679		2.38		411,960			2,361		2.27
Commercial, financial, and agricultural loans	409,184			3,950		3.83		380,379			3,711		3.87
Real estate—commercial and construction loans	870,620			9,822		4.48		625,636			6,773		4.30
Real estate—residential loans	530,550			5,967		4.46		308,630			3,111		4.00
Loans to individuals	29,900			403		5.35		29,801			413		5.50
Municipal loans and leases	218,585			2,572		4.67		191,206			2,320		4.81
Lease financings	74,083			1,567		8.39		72,266			1,597		8.77
Gross loans and leases	2,132,922			24,281		4.52		1,607,918			17,925		4.42
Total interest-earning assets	2,578,867			26,960		4.15		2,019,878			20,286		3.98
Cash and due from banks	33,787							33,140
Reserve for loan and lease losses	(18,858		)					(22,315		)
Premises and equipment, net	41,699							36,186
Other assets	231,353							172,126
Total assets	$	2,866,848						$	2,239,015
Liabilities:
Interest-bearing checking deposits	$	386,243		$	79	0.08		$	316,827		$	43	0.05
Money market savings	391,891			348		0.35		320,559			159		0.20
Regular savings	595,019			141		0.09		523,768			79		0.06
Time deposits	477,524			1,034		0.86		256,637			751		1.16
Total time and interest-bearing deposits	1,850,677			1,602		0.34		1,417,791			1,032		0.29
Short-term borrowings	21,189			2		0.04		41,048			7		0.07
Subordinated notes (1)	49,358			674		5.42		—			—		—
Total borrowings	70,547			676		3.80		41,048			7		0.07
Total interest-bearing liabilities	1,921,224			2,278		0.47		1,458,839			1,039		0.28
Noninterest-bearing deposits	542,978							458,147
Accrued expenses and other liabilities	42,125							30,482
Total liabilities	2,506,327							1,947,468
Shareholders' Equity:
Common stock	110,271							91,332
Additional paid-in capital	121,028							62,743
Retained earnings and other equity	129,222							137,472
Total shareholders' equity	360,521							291,547
Total liabilities and shareholders' equity	$	2,866,848						$	2,239,015
Net interest income				$	24,682						$	19,247
Net interest spread						3.68							3.70
Effect of net interest-free funding sources						0.12							0.08
Net interest margin						3.80	%						3.78	%
Ratio of average interest-earning assets to average interest-bearing liabilities	134.23			%				138.46			%
(1) The interest rate on subordinated notes is calculated on a 30/360 day basis at a rate of 5.10%. The balance is net of debt issuance costs which are amortized to interest expense.
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 December 31, 2015 and 2014 have been calculated using the Corporation’s federal applicable rate of 35.0%.

Distribution of Assets, Liabilities and Shareholders' Equity: Interest Rates and Interest Differential
	For the Twelve Months Ended December 31,
Tax Equivalent Basis	2015							2014
	Average			Income/		Average		Average			Income/		Average
(Dollars in thousands)	Balance			Expense		Rate		Balance			Expense		Rate
Assets:
Interest-earning deposits with other banks	$	38,515		$	95	0.25	%	$	33,482		$	81	0.24	%
U.S. government obligations	123,593			1,375		1.11		128,487			1,287		1.00
Obligations of state and political subdivisions	107,204			5,303		4.95		106,365			5,554		5.22
Other debt and equity securities	143,133			3,296		2.30		137,900			2,702		1.96
Federal funds sold	1,831			2		0.11		—			—		—
Total interest-earning deposits, investments and federal funds sold	414,276			10,071		2.43		406,234			9,624		2.37
Commercial, financial, and agricultural loans	422,507			16,901		4.00		392,747			15,636		3.98
Real estate—commercial and construction loans	849,161			39,275		4.63		608,602			26,454		4.35
Real estate—residential loans	499,208			22,789		4.57		293,610			11,987		4.08
Loans to individuals	29,653			1,587		5.35		33,675			2,040		6.06
Municipal loans and leases	208,236			9,890		4.75		180,914			8,767		4.85
Lease financings	72,052			6,240		8.66		71,287			6,404		8.98
Gross loans and leases	2,080,817			96,682		4.65		1,580,835			71,288		4.51
Total interest-earning assets	2,495,093			106,753		4.28		1,987,069			80,912		4.07
Cash and due from banks	33,025							32,710
Reserve for loan and lease losses	(20,447		)					(24,287		)
Premises and equipment, net	40,891							35,099
Other assets	227,721							171,656
Total assets	$	2,776,283						$	2,202,247
Liabilities:
Interest-bearing checking deposits	$	369,611		$	269	0.07		$	314,784		$	172	0.05
Money market savings	368,392			1,205		0.33		295,209			373		0.13
Regular savings	582,647			533		0.09		535,346			317		0.06
Time deposits	461,968			4,000		0.87		264,591			3,102		1.17
Total time and interest-bearing deposits	1,782,618			6,007		0.34		1,409,930			3,964		0.28
Short-term borrowings	35,932			35		0.10		41,215			32		0.08
Subordinated notes (1)	37,431			2,023		5.40		—			—		—
Total borrowings	73,363			2,058		2.81		41,215			32		0.08
Total interest-bearing liabilities	1,855,981			8,065		0.43		1,451,145			3,996		0.28
Noninterest-bearing deposits	517,566							435,058
Accrued expenses and other liabilities	43,011							29,006
Total liabilities	2,416,558							1,915,209
Shareholders' Equity:
Common stock	110,271							91,332
Additional paid-in capital	120,565							62,163
Retained earnings and other equity	128,889							133,543
Total shareholders' equity	359,725							287,038
Total liabilities and shareholders' equity	$	2,776,283						$	2,202,247
Net interest income				$	98,688						$	76,916
Net interest spread						3.85							3.79
Effect of net interest-free funding sources						0.11							0.08
Net interest margin						3.96	%						3.87	%
Ratio of average interest-earning assets to average interest-bearing liabilities	134.44			%				136.93			%
(1) The interest rate on subordinated notes is calculated on a 30/360 day basis at a rate of 5.10%. The balance is net of debt issuance costs which are amortized to interest expense.
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 twelve months ended December 31, 2015 and 2014 have been calculated using the Corporation’s federal applicable rate of 35.0%.