Univest Financial Reports 5.5% Asset Growth, 9.2% Net Income Increase in Q3 2024

Univest Financial Corporation reported significant financial developments in its 10-Q filing for the quarter ending September 30, 2024. The company experienced a 5.5% increase in total assets, rising to $8,205.7 million from $7,780.6 million at the end of 2023. This growth was primarily driven by a substantial increase in cash and cash equivalents, which surged to $504.7 million from $249.8 million, reflecting a strategic focus on liquidity.

Total deposits also rose by 7.5%, reaching $6,854.1 million, compared to $6,375.8 million at the end of the previous fiscal year. The increase in deposits was accompanied by a rise in the weighted average interest rate on deposits, which increased to 2.88% from 2.38%. Notably, noninterest-bearing deposits decreased to $1.3 billion, down from $1.5 billion, indicating a shift in the deposit mix.

For the three months ended September 30, 2024, total interest income increased to $106.4 million, up from $97.1 million in the same period of 2023. However, net interest income slightly declined to $53.2 million from $53.6 million year-over-year, reflecting pressures on net interest margins, which fell to 2.82% from 2.96%. The company attributed this decline to excess liquidity impacting margins.

Net income for the third quarter was $18.6 million, a 9.2% increase from $17.0 million in the prior year, with diluted earnings per share rising to $0.63 from $0.58. For the nine months ended September 30, 2024, net income totaled $56.99 million, compared to $54.85 million in the same period of 2023, marking a 3.9% increase.

The company’s noninterest income also saw growth, totaling $20.2 million for the third quarter, up from $18.7 million in 2023. This increase was driven by higher investment advisory and insurance commission income. Conversely, noninterest expenses decreased slightly, reflecting cost management efforts.

In terms of credit quality, nonaccrual loans decreased to $15.3 million from $20.5 million at the end of 2023, and total nonperforming loans fell to $15.6 million from $21.1 million. The allowance for credit losses increased to $86.0 million, indicating a cautious approach to potential credit risks.

Strategically, Univest Financial continues to focus on enhancing its capital position, with total shareholders' equity increasing to $877.1 million from $839.2 million. The company remains committed to its stock repurchase program, having approved an additional 1,000,000 shares for repurchase in October 2024. Overall, the financial results reflect a solid performance amid a challenging economic environment, with a focus on maintaining liquidity and managing credit quality.