Univest Financial (UVSP) 8-K Univest Corporation of Pennsylvania — Univest National Bank and Trust Co. — Reports First Quarter Earnings

Exhibit 99.1

CONTACT: Jeff Schweitzer
UNIVEST CORPORATION OF PENNSYLVANIA
Chief Financial Officer
215-721-2458,schweitzerj@univest.net

FOR IMMEDIATE RELEASE

UNIVEST CORPORATION OF PENNSYLVANIA — UNIVEST NATIONAL
BANK AND TRUST CO. — REPORTS FIRST QUARTER EARNINGS

SOUDERTON, Pa., April 28, 2010 — Univest Corporation of Pennsylvania(NASDAQ: UVSP), parent company of Univest National Bank and Trust Co. of Souderton, Pa., today announced financial results for the first quarter. Univest reported net income of $3.0 million or $0.18 diluted earnings per share for the quarter ended March 31, 2010, compared to $1.5 million or $0.09 diluted earnings per share in the previous quarter ended December 31, 2009 and $3.8 million or $0.30 diluted earnings per share for the comparable period in the prior year.

Deposits

Total non-time deposits increased $28.0 million during the quarter. The increase consisted of an increase of $4.2 million in non-interest bearing deposits and $23.8 million in NOW, money market and savings accounts. These increases were offset by a decline in time deposits of $19.6 million.

Loans

Gross loans and leases increased slightly by $1.8 million during the quarter primarily due to less credit demand and utilization of lines by businesses responding to the current economic environment.

Net Interest Income and Margin

Net interest income of $17.1 million in the first quarter of 2010 increased $760 thousand, or 4.65%, over the first quarter of 2009. The net interest margin on a tax-equivalent basis for the first quarter of 2010 increased 30 basis points to 3.99% from 3.69% for the fourth quarter ended December 31, 2009 and 23 basis points compared to 3.76% for the first quarter of 2009. The increase in the net interest income and the net interest margin can be attributed to declines in the cost of interest-bearing liabilities, primarily time deposits and Federal Home Loan Bank (FHLB) borrowings, exceeding the declines in yields on total interest-earning assets. The Corporation has continued to experience core deposit growth which has allowed the Corporation to continue to repay its maturing FHLB advances reducing FHLB advances from $92 million at December 31, 2009 to $64 million at March 31, 2010.

Non-Interest Income

Total non-interest income, excluding the impact of other-than-temporary impairments on the Corporation’s bank equity portfolio, increased 11.71% for the quarter ended March 31, 2010 compared to the quarter ended March 31, 2009. For the quarter ended March 31, 2010, Univest reported total non-interest income of $8.2 million compared to $6.2 million for the comparable period in the prior year. This is attributed to increased fee income across each revenue source and reduced costs related to other-than-temporary impairment charges. Univest recorded other-than-temporary impairment charges on certain bank equity securities in the first quarter of 2010 of $5 thousand compared to charges of $1.2 million in the first quarter of 2009.

Non-Interest Expense

Non-interest expense for the first quarter of 2010 compared to the first quarter of 2009 increased $1.6 million or 10.17%, primarily due to increases in salaries and benefits expenses of $379 thousand due to investments in personnel to grow the Corporation’s mortgage banking and commercial lending capabilities and increases of $521 thousand in marketing and advertising expenses to support a major brand campaign to position the Corporation to take advantage of the disruption in its markets. Other increases occurred as a result of increased audit expenses and legal fees for nonperforming loan activity.

Asset Quality and Provision for Loan and Lease Losses

Nonaccrual loans and leases were $34.9 million at March 31, 2010 compared to $33.5 million at December 31, 2009 and $3.7 million at March 31, 2009. Nonperforming loans and leases as a percentage of total loans and leases equaled 2.58% at March 31, 2010 compared to 2.65% at December 31, 2009 and 0.45% at March 31, 2009. The provision for loan and lease losses was $4.9 million for the first quarter of 2010 compared to $7.4 million for the quarter ended December 31, 2009 and $2.2 million for the quarter ended March 31, 2009. As a result of the increased provision year-over-year, the allowance for loan and lease losses as a percentage of total loans and leases increased to 1.90% at March 31, 2010 from 1.74% at December 31, 2009 and 1.01% at March 31, 2009. The allowance for loan and lease losses to nonperforming loans and leases equaled 73.45% at March 31, 2010 which increased from 65.54% at December 31, 2009. The allowance for loan and lease losses to nonperforming loans and leases was 225.39% at March 31, 2009.

Capital

Univest continues to remain well-capitalized at March 31, 2010. Univest’s total risk-based capital at December 31, 2009 was 15.78%, well in excess of the regulatory minimum for well capitalized status of 10% for total risk-based capital.

Dividend

On April 1, 2010, Univest Corporation paid a quarterly cash dividend of $0.20 per share, which represented a 4.36% annualized yield based on the closing price of Univest’s stock on the date the dividend was paid.

About Univest Corporation

Headquartered in Souderton, Pa., Univest Corporation of Pennsylvania (www.univest.net) and its subsidiaries serve the financial needs of residents, businesses, and nonprofit organizations in Bucks, Chester, Montgomery and Lehigh counties.  Univest National Bank and Trust Co., member FDIC and Equal Housing Lender, offers customers 32 financial service centers, 12 retirement financial services centers, and 38 ATM locations throughout the region, and is the parent company of Univest Capital, Inc., a small ticket commercial finance business;  Univest Insurance, Inc., an independent insurance agency headquartered in Lansdale, Pa., which serves commercial and personal customers; and  Univest Investments, Inc., Member FINRA and SIPC, a full-service broker-dealer and investment advisory firm. For more information on Univest Corporation of Pennsylvania and its subsidiaries, please visitwww.univest.net.

# # #

This press release of Univest Corporation and the reports Univest Corporation files with the Securities and Exchange Commission often contain “forward-looking statements” relating to present or future trends or factors affecting the banking industry and, specifically, the financial operations, markets and products of Univest Corporation. These forward-looking statements involve certain risks and uncertainties. There are a number of important factors that could cause Univest Corporation’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 is engaged; (6) technological issues which may adversely affect Univest Corporation’s financial operations or customers; (7) changes in the securities markets or (8) risk factors mentioned in the reports and registration statements Univest Corporation files with the Securities and Exchange Commission. Univest Corporation undertakes no obligation to revise these forward-looking statements or to reflect events or circumstances after the date of this press release.

Univest Corporation of Pennsylvania
Consolidated Selected Financial Data
March 31, 2010

(Dollars in thousands)

Balance Sheet (Period End)

	03/31/10		12/31/09		09/30/09		06/30/09		03/31/09
Assets	$	2,064,822	$	2,085,421	$	2,117,849	$	2,086,821	$	2,065,901
Securities		436,368		420,045		472,491		425,774		410,357
Loans held for sale		1,165		1,693		1,439		1,119		5,072
Loans and leases, gross		1,427,805		1,425,980		1,451,128		1,464,886		1,450,420
Allowance for loan and lease losses		27,065		24,798		21,945		18,824		14,720
Loans and leases, net		1,400,740		1,401,182		1,429,183		1,446,062		1,435,700
Total deposits		1,572,681		1,564,257		1,536,903		1,565,076		1,573,052
Non-interest bearing deposits		246,909		242,691		226,395		222,877		218,148
NOW, Money Market and Savings		894,799		871,024		812,122		833,825		819,659
Time deposits		430,973		450,542		498,386		508,374		535,245
Borrowings		187,637		214,063		267,821		265,457		245,962
Shareholders’ equity		267,850		267,807		268,052		208,358		206,238

Balance Sheet (Average)

	For the three months ended,
	03/31/10		12/31/09		09/30/09		06/30/09		03/31/09
Assets	$	2,038,739	$	2,096,945	$	2,098,964	$	2,077,565	$	2,059,965
Securities		409,188		454,096		447,925		413,142		419,995
Loans and leases, gross		1,420,830		1,438,880		1,456,446		1,471,243		1,446,157
Deposits		1,537,676		1,553,308		1,547,436		1,560,317		1,555,964
Shareholders’ equity		269,030		267,645		240,267		208,321		204,544

Asset Quality Data (Period End)

	03/31/10			12/31/09			09/30/09			06/30/09			03/31/09
Nonaccrual loans and leases	$	34,856		$	33,498		$	33,116		$	5,762		$	3,675
Accruing loans and leases 90 days or more past due		303			726			644			1,839			2,109
Troubled debt restructured		1,691			3,611			3,216			3,324			747
Other real estate owned		2,453			3,428			3,330			2,812			2,824
Nonperforming assets		39,303			41,263			40,306			13,737			9,355
Allowance for loan and lease losses		27,065			24,798			21,945			18,824			14,720
Nonperforming loans and leases / Loans and leases		2.58	%		2.65	%		2.55	%		0.75	%		0.45	%
Allowance for loan and lease losses / Loans and leases		1.90	%		1.74	%		1.51	%		1.29	%		1.01	%
Allowance for loan and lease losses / Nonperforming loans		73.45	%		65.54	%		59.35	%		172.30	%		225.39	%

	For the three months ended,
	03/31/10			12/31/09			09/30/09			06/30/09			03/31/09
Net loan and lease charge-offs	$	2,628		$	4,595		$	2,807		$	1,249		$	554
Net loan and lease charge-offs (annualized)/Average loans and leases		0.75	%		1.27	%		0.76	%		0.34	%		0.16	%

Univest Corporation of Pennsylvania
Consolidated Selected Financial Data
March 31, 2010

(Dollars in thousands, except per share data)

	For the three months ended,
For the period:	03/31/10			12/31/09			09/30/09			06/30/09			03/31/09
Interest income	$	22,485		$	23,184		$	24,244		$	24,529		$	24,402
Interest expense		5,380			6,409			6,901			7,356			8,057
Net interest income		17,105			16,775			17,343			17,173			16,345
Provision for loan and lease losses		4,895			7,449			5,928			5,353			2,156
Net interest income after provision		12,210			9,326			11,415			11,820			14,189
Noninterest income:
Trust fee income		1,500			1,461			1,325			1,325			1,425
Service charges on deposit accounts		1,782			1,986			1,745			1,692			1,613
Investment advisory commission and fee income		1,056			1,025			876			766			760
Insurance commissions and fee income		2,243			1,514			1,470			1,964			2,133
Bank owned life insurance income		332			351			405			408			157
Other-than-temporary impairment		(5	)		(761	)		(47	)		(223	)		(1,177	)
Net gain (loss) on sales of securities		49			1,023			112			(22	)		37
Gain on sales of loans held for sale		360			891			401			669			261
Other income		890			1,329			811			1,247			965
Total noninterest income		8,207			8,819			7,098			7,826			6,174
Noninterest expense
Salaries and benefits		9,811			9,755			8,818			9,417			9,432
Premises and equipment		2,292			2,138			2,216			2,125			2,233
Deposit insurance premiums		597			599			526			1,477			583
Other expense		4,379			4,976			4,003			3,771			3,255
Total noninterest expense		17,079			17,468			15,563			16,790			15,503
Income before taxes		3,338			677			2,950			2,856			4,860
Applicable income taxes		368			(845	)		197			187			1,024
Net income	$	2,970		$	1,522		$	2,753		$	2,669		$	3,836
Per Common Share Data:
Book value per share	$	16.17		$	16.27		$	16.30		$	16.00		$	15.87
Net income per share:
Basic	$	0.18		$	0.09		$	0.19		$	0.21		$	0.30
Diluted	$	0.18		$	0.09		$	0.19		$	0.21		$	0.30
Dividends per share	$	0.20		$	0.20		$	0.20		$	0.20		$	0.20
Weighted average shares outstanding		16,535,461			16,464,824			13,635,961			13,023,148			12,977,369
Period end shares outstanding		16,561,807			16,465,083			16,442,021			13,023,704			12,996,291

Univest Corporation of Pennsylvania
Consolidated Selected Financial Data
March 31, 2010

	For the three months ended,
	03/31/10			12/31/09			09/30/09			06/30/09			03/31/09
Profitability Ratios (annualized)
Return on average assets		0.59	%		0.29	%		0.52	%		0.52	%		0.76	%
Return on average shareholders’ equity		4.48	%		2.26	%		4.55	%		5.14	%		7.61	%
Net interest margin (FTE)		3.99	%		3.69	%		3.82	%		3.87	%		3.76	%
Efficiency ratio (1)		64.33	%		65.36	%		60.58	%		63.96	%		65.70	%
Capitalization Ratios
Dividends paid to net income		111.55	%		216.43	%		119.47	%		97.60	%		67.75	%
Shareholders’ equity to assets (Period End)		12.97	%		12.84	%		12.66	%		9.98	%		9.98	%
Tangible common equity to tangible assets		10.55	%		10.44	%		10.28	%		7.49	%		7.47	%
Regulatory Capital Ratios (Period End)
Tier 1 leverage ratio		11.82	%		11.46	%		11.51	%		8.86	%		8.89	%
Tier 1 risk-based capital ratio		14.44	%		14.41	%		14.12	%		10.65	%		10.72	%
Total risk-based capital ratio		15.78	%		15.76	%		15.47	%		11.89	%		11.74	%

(1) Total operating expenses to net interest income before loan loss provision plus non-interest income adjusted for tax equivalent income.

Distribution of Assets, Liabilities and Shareholders’ Equity: Interest Rates and Interest Differential

	For the Three Months Ended March 31,
	2010								2009
	Average			Income/		Average			Average			Income/		Average
Tax Equivalent Basis	Balance			Expense		Rate			Balance			Expense		Rate
Assets:
Interest-earning deposits with other banks	$	14,293		$	11		0.31	%	$	3,333		$	3		0.37	%
U.S. Government obligations		114,164			742		2.64			94,844			982		4.20
Obligations of state and political subdivisions		106,634			1,739		6.61			100,450			1,712		6.91
Other debt and equity securities		188,390			2,019		4.36			224,701			2,834		5.11
Federal funds sold		—			—		—			233			—		—
Total interest-earning deposits, investments and federal funds sold		423,481			4,511		4.32			423,561			5,531		5.30
Commercial, financial, and agricultural loans		409,663			4,666		4.62			396,127			4,567		4.68
Real estate—commercial and construction loans		524,084			7,561		5.85			502,111			7,278		5.88
Real estate—residential loans		260,959			2,858		4.44			310,926			3,718		4.85
Loans to individuals		47,509			798		6.81			53,275			941		7.16
Municipal loans and leases		97,448			1,425		5.93			85,899			1,315		6.21
Lease financings		81,167			1,723		8.61			97,819			2,044		8.47
Gross loans and leases		1,420,830			19,031		5.43			1,446,157			19,863		5.57
Total interest-earning assets		1,844,311			23,542		5.18			1,869,718			25,394		5.51
Cash and due from banks		31,621								31,184
Reserve for loan losses		(26,579	)							(13,669	)
Premise and equipment, net		34,859								32,495
Other assets		154,527								140,237
Total assets	$	2,038,739							$	2,059,965
Liabilities:
Interest-bearing checking deposits	$	171,978		$	57		0.13		$	155,147		$	87		0.23
Money market savings		279,912			317		0.46			327,777			644		0.80
Regular savings		415,934			781		0.76			319,497			779		0.99
Time deposits		434,166			3,065		2.86			541,795			4,902		3.67
Total time and interest-bearing deposits		1,301,990			4,220		1.31			1,344,216			6,412		1.93
Securities sold under agreements to repurchase		95,841			117		0.50			75,513			118		0.63
Other short-term borrowings		71,266			685		3.90			74,762			361		1.96
Long-term debt		5,746			47		3.32			83,967			838		4.05
Subordinated notes and capital securities		25,494			311		4.95			26,998			328		4.93
Total borrowings		198,347			1,160		2.37			261,240			1,645		2.55
Total interest-bearing liabilities		1,500,337			5,380		1.45			1,605,456			8,057		2.04
Demand deposits, non-interest bearing		235,686								211,748
Accrued expenses and other liabilities		33,686								38,217
Total liabilities		1,769,709								1,855,421
Shareholders’ Equity
Common stock		91,332								74,370
Capital surplus		61,420								22,793
Retained earnings and other equity		116,278								107,381
Total shareholders’ equity		269,030								204,544
Total liabilities and shareholders’ equity	$	2,038,739							$	2,059,965
Net interest income				$	18,162							$	17,337
Net interest spread							3.73								3.47
Effect of net interest-free funding sources							0.26								0.29
Net interest margin							3.99	%							3.76	%
Ratio of average interest-earning assets to average interest-bearing liabilities equity		122.93	%							116.46	%

Notes:	For rate calculation purposes, average loan and lease categories include unearned discount.
	Nonaccrual loans and leases have been included in the average loan and lease balances.
	Loans held for sale have been included in the average loan balances.
	Tax-equivalent amounts for the three months ended March 31, 2010 and 2009 have been calculated using the Corporation’s federal applicable rate of 35.0%.