Univest Financial
Annual Report 2011

Plain-text annual report

Firmly rooted COMMITTED TO GROWTH 2011 annual report moving Forward TOGETHER Firmly rooted. Committed to growth. We continued to face unprecedented times in the financial The story which unfolds in the pages ahead, highlights how services industry in 2011 due to the challenging economy Univest Corporation, firmly rooted and well positioned to and unsettled regulatory environment. U.S. housing prices embrace the change needed to grow, led the way. Our declined further while the U.S. economy showed modest success is attributed to solid relationships. Relationships signs of a recovery. Emerging markets, specifically China with our customers, shareholders, employees and the and Europe, showed contraction, and key events around communities we serve. While many financial institutions the rest of the world posed a threat to domestic growth. made compromises to weather these challenging times, Consumer confidence remained low as unemployment Univest Corporation remained true to our mission, vision remained a significant problem for the economy. and core values. We worked alongside our employees Throughout the banking industry, in addition to dealing with the effects of a compressed interest margin and an almost non-existent demand for loans, banks of all sizes experienced declining revenue streams as the cost of doing business increased to comply with the new regulations. As if all of this was not enough, constant attention from Washington and the media brought increased pressure and significant volatility to stock performance. Steady and stable growth, under these conditions, clearly could only be achieved by true leaders. and customers to ensure together, we would succeed. We hope the stories these individuals and businesses share with you through our annual report will connect you to the local successes we have right here in our community. table of Contents Financial Performance ..................................1 Letter to Shareholders ................................2-3 2011 Highlights ...................................... 4-13 Officers and Board of Directors ........... 14-15 Shareholder Information .........................16 2011 Financial Highlights At December 31, (Dollars in thousands) 2011 2010 Cash, interest-earning deposits and federal funds sold Investment securities Net loans and leases Other assets Total assets $ 107,377 471,165 1,416,536 211,761 $ 2,206,839 $ 29,187 467,024 1,440,288 197,394 $ 2,133,893 Deposits Borrowings Other liabilities Total liabilities Shareholders’ equity Total liabilities and shareholders’ equity $ 1,749,232 137,234 47,394 1,933,860 272,979 $ 2,206,839 $ 1,686,270 143,865 37,534 1,867,669 266,224 $ 2,133,893 For the years ended December 31, (Dollars in thousands, except share and per share data) 2011 2010 2009 Interest income Interest expense Net interest income Provision for loan and lease losses Net interest income after provision for loan and lease losses Noninterest income Noninterest expense Net income before income taxes Applicable income taxes Net income $ 85,468 10,728 74,740 17,479 57,261 34,407 68,010 23,658 4,776 $ 18,882 $ 91,003 17,469 73,534 21,565 51,969 34,418 67,349 19,038 3,282 $ 15,756 $ 96,359 28,723 67,636 20,886 46,750 29,917 65,324 11,343 563 $ 10,780 Book value per share Net income per share: $ 16.34 $ 15.99 $ 16.27 Basic Diluted Dividends per share 1.13 1.13 0.80 0.95 0.95 0.80 0.75 0.75 0.80 Weighted Average Shares Outstanding Period End Shares Outstanding 16,742,898 16,702,376 16,598,284 16,648,303 14,347,104 16,465,083 9 4 7 , 1 6 8 6 , 1 5 8 0 , 2 5 8 0 , 2 7 0 2 , 2 4 3 1 , 2 3 7 9 , 1 0 3 9 , 1 8 7 . 0 8 . 0 8 . 0 8 . 0 8 . 0 8 . 4 6 5 , 1 3 3 5 , 1 7 2 5 , 1 9 8 4 , 1 7 4 1 , 9 0 1 2 5 9 , 7 0 1 3 5 5 , 7 9 2 6 3 , 2 9 5 8 2 , 9 8 2 3 9 , 6 8 ‘08 ‘07 ‘06 ‘09 Total Deposits (IN MILLIONS) ‘10 ‘11 ‘09 ‘08 ‘06 ‘07 Total Assets (IN MILLIONS) ‘10 ‘11 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 Dividends Declared (PER SHARE) ‘08 ‘07 ‘06 ‘09 Total Revenue (IN THOUSANDS) ‘10 ‘11 1 A Focused Team. Leadership Towards a Bright Future. Members of the Executive Management Team (left to right): Jeffrey M. Schweitzer, Philip C. Jackson, William S. Aichele, Kenneth D. Hochstetler, K. Leon Moyer, Duane J. Brobst, Annette D. Szygiel, Louis P. Spinelli To Our Family of Shareholders, Customers and Employees Univest Corporation took every opportunity to build our business for long-term success as we celebrated 135 years of community banking in 2011. We are pleased and grateful to report increased earnings with net income of $18.9 million compared to $15.8 million at December 31, 2010. We increased net income year-over-year by 19.84% in a challenging economic climate and furthermore a difficult banking environment. Our favorable performance compared to our peers and the overall industry is attributed to the successful implementation of our integrated strategy and a testament to our solid reputation as a stable and trusted partner. The respect we have from our employees, customers, shareholders and communities has been earned throughout our 135-year history. In that tradition, we remained focused and disciplined in our approach to managing the business by making decisions with the best interest of all our stakeholders in mind. We sought opportunities to grow our market share and increase our customer base and core deposit accounts. We continued lending to credit worthy borrowers and were recognized by the Small Business Administration as the leading community bank in the Philadelphia region based on loan volume. We saw increased referrals and sales from our non-traditional lines of business as our branding efforts raised awareness of our capabilities. We launched new products, enhanced technology and introduced secure and convenience-driven solutions to remain competitive. While it may seem like it was a characteristic year, 2011 was anything but typical. Heightened regulatory requirements continued to bring new pressures as the cost of doing business increased while revenue streams decreased. The financial services industry continued to face scrutiny from the media and the federal government, making it difficult for consumers to gain confidence and investors to believe in the future success of the industry. Overall, the economic turmoil in the United States and abroad raised even greater concern for consumers and brought additional pressures with compressed margins, teetering asset quality levels and volatile stock performance for banks. As our industry changes and evolves, we continue to adapt to position Univest for a bright future. To ensure we remain a leading local, independent, financial solutions provider, the Board of Directors and Executive Management Team initiated two strategic changes. We became a state-chartered Federal Reserve member bank to assist us as we execute our strategy as a community bank. We also adopted a Shareholder Rights Plan to protect Univest and our shareholders from any hostile attempts to take over the company. These two changes were possible because of our solid corporate governance practices, stringent ethical standards, accountability, strong risk management practices and robust strategic planning process. loyal shareholders. In these unprecedented times, many financial companies have decreased dividends and eliminated jobs. Knowing our shareholders, employees and communities depend on us, we worked hard to increase organizational productivity and accountability to become more efficient and ensure a fair profit, competitive compensation and unwavering financial support. While the state of the economy and industry could have made it easy for Univest to pull back on its investments in our people and our communities, we realize taking care of our family members and the markets we serve are critical to long-term success. We pride ourselves on actively serving our communities and giving back through financial contributions and volunteer efforts. Employees were engaged in various service initiatives and personally made record-setting contributions to our annual United Way Campaign. Giving back has always been a tradition at Univest, but the importance of making a difference in the communities we serve was taught and modeled to me by the actions of one of our former leaders, Charles H. Hoeflich, Chairman Emeritus. Charlie retired from the Board of Directors in May after 49 years of service. Just six months later, Charlie passed away. Our employees, community, industry and many great leaders celebrated his life. He was an amazing man who had an incredible vision and desire to see Univest succeed. In this report, in addition to sharing our 2011 highlights, we honor his legacy. Our firm roots grew stronger this past year as we upheld the high standards of our mission, vision and core values. We remain well-capitalized and well-positioned to continue working together with our customers and communities to move forward and realize our vision to be the best integrated financial solutions provider in the market. On behalf of the entire Univest family, we thank you for your continued support and investment. Sincerely, Univest has always looked ahead with optimism because we have continued to show our resilience. We are proud of our ability to overcome challenges and share our success with our William S. Aichele Chairman, President and Chief Executive Officer January 31, 2012 3 “Univest’s extensive knowledge in employee benefits and excellent service gave Aqua the competitive advantage while recruiting in the Pharmaceuticals industry.” – Lisa Wilk, Director of Human Resources, Aqua Pharmaceuticals 2011 Highlights Traditions Celebrated. History Made. Univest Corporation celebrated its 135th anniversary in embraced and implemented historic changes throughout the 2011 by carrying out our tradition of delivering quality year to align our company with regulatory agencies which financial solutions, exceptional service and unwavering have a better understanding of our local markets, protect the community support. Together, we deepened relationships best interests of our shareholders, and position the expertise and formed new bonds by welcoming customers eager to of our employees to deliver the solutions and support our find a stable, local financial partner to serve them today and customers’ needs. well into the future. The first historic move was to change the bank from a nationally- Our anniversary celebration, which included a variety of chartered institution to a state-chartered, Federal Reserve activities to thank our customers and communities for their member bank. On June 30, this took effect and Univest opened loyalty and trust, helped elevate the Univest name and for business as Univest Bank and Trust Co. Other than our new increased our positive image throughout our marketplace. name, our customers did not experience any change as a result We continued our tradition of giving back by using our of this transition. The Company, however, will realize greater anniversary events to increase children’s financial literacy operational efficiencies and additional support to execute our education and raise money for childhood cancer. strategy as a community bank. While traditions are often tied to an anniversary, Univest On the heels of the charter change, the Board of Directors understood the new and evolving landscape for the banking voted to adopt a Shareholder Rights Plan, similar to plans industry and the need to be open to change. We did not adopted by over 1,000 public companies to address spend the year reflecting on history and past successes, but the best interests of all of our stakeholders and prevent rather planning and laying the foundation to position the an abusive takeover or attempt to acquire control of the company for future growth. Company at an inadequate price. With our mission, vision and core values as guiding Working alongside our customers in these challenging principles, our Board of Directors and Executive times led us to restructure the bank and shift our focus from Management Team looked at the business differently. geographic boundaries to business segments. Philip C. Operating from a position of strength as a result of our Jackson was appointed President of Corporate Banking ability to earn our way through these challenging economic and the expertise of his team was aligned with small, times, we saw opportunity to further strengthen Univest. We middle market and large corporate businesses. In this new “I’m happy to work for a company that values the commitment to its employees and communities.” – Julie Sheehan, Benefits Specialist 5 structure, our relationship managers focus on the needs of opportunities to strengthen the business. For the year ended the businesses in their varied segments, while also targeting December 31, 2011, we reported net income of $18.9 million new prospects with similar servicing needs. In Consumer compared to $15.8 million in 2010. Banking, we streamlined the operation by aligning leadership across four regions instead of six, focusing overall on personal banking and main street business solutions. We believe these changes better position us to strengthen communications and enhance experiences for our customers and communities. “It was a year of teamwork with improved collaboration, greater efficiencies and stronger relationships.” – Melissa Merrill, Corporate Underwriter Community Banking Roots. Integrated Vision. Our industry overall saw record deposit levels in 2011 as consumers remained cautious with their investments. At Univest, we experienced a significant increase with total deposits growing $63 million and total core deposits increasing $72.2 million. Disruption in the marketplace, heightened awareness of the Univest brand, stronger sales efforts and campaigns to attract new checking accounts contributed to our success. While loan demand was almost nonexistent for most consumers and businesses, we continued to lend and actually saw a significant increase in demand as a preferred Small Business Administration provider. Univest Capital, our small ticket leasing subsidiary, originated $35.7 million of leases primarily to small businesses to support the growth of these Main Street businesses. We take great pride in our ability to invest in and support our local businesses and overall extended $108.8 million of new The changes we implemented in 2011 enabled us to evolve originations to support their growth. These businesses strengthen the business and make decisions to position the company for our neighborhoods and fuel our local economy, which is where short-term and long-term success. Understanding our roots while the recovery for our nation begins. moving forward with positive change does not happen with leadership alone. Change must be embraced at all levels in In addition to growing our customers on the traditional order to achieve success. We want to thank the Univest family banking side, we realized the benefits of having an integrated for not only accepting change this past year but embracing suite of offerings to offset the challenges brought about by a it and using it to motivate us to learn, grow and seize new compressed margin, lackluster loan demand and less utilization of lines of credit. Unlike many community banks, 35.95% of our pre-tax income in 2011 came from non-traditional lines of business including investments, insurance, leasing and mortgage banking. The Benefits was brought under the Univest Insurance, Inc. umbrella continued growth in these areas is quite an achievement and immediately, Trollinger Consulting Group took on the family name cannot be attributed to one line of business but is a reflection this year as we established Univest Municipal Pension Services of increased referrals from front and back office employees. to provide integrated financial solutions to municipalities across Customers are experiencing the convenience and benefits as the state of Pennsylvania. We have already welcomed many new we strive to be the best integrated financial solutions provider relationships which have the potential to bring future opportunities in the market. to other parts of the company. While we define Univest as a community bank with total assets In addition to these acquisitions growing our suite of financial of $2.2 billion, our employees, customers, shareholders and solutions, we also grew in leadership. In 2011, Ronald R. communities cannot overlook the size of our subsidiaries. In Flaherty – former owner and President of Liberty Benefits, Inc. – 2011, we surpassed a milestone mark of $2 billion in assets was named President of Univest Insurance, Inc. under management and supervision with our combined wealth management and trust, brokerage and investment advisory Managing the business with discipline and focusing on growing platforms. This achievement demonstrates how customers are our integrated platform required us to change behaviors. recognizing Univest as more than a banking partner and trusting Employees were asked to think like entrepreneurs, tell the us with all financial aspects of their relationship. Univest story and introduce customers, friends and family to our solutions. Eleven years after adopting this diversified model, it is Some of the top performing non-traditional business lines are also coming more naturally to our associates and we are a stronger the newer teams to join the Univest family. The mortgage banking and more profitable company as a result. group contributed significantly to our strong performance with $237 million in loan originations. Their success was in part due to In addition to growing our traditional and non-traditional lines of the prolonged buyer’s market and low interest rate environment, business and earning our way through this tough cycle, Univest but also came from solid sales execution and increased internal bolstered our well-capitalized position and rewarded loyal referrals. Approximately 50% of the business booked was shareholders with consistent dividends. In 2011, shareholders referred to the mortgage team by associates in both the corporate received a dividend yield of 5.46%. banking and consumer banking areas. Two acquisitions, Trollinger Consulting Group and Liberty Benefits, completed at the onset of the recession in 2008 have not only been accretive, but they rounded out our integrated offerings and contributed significantly to increased earnings. While Liberty “Community is the heart of Univest and I’ve been fortunate to be a part of it for over 25 years.” – Tracy Fretz, Community Reinvestment Act Officer 7 Innovative Solutions. Multi-Channel Delivery. Our favorable performance and ability to reward security and peace of mind to customers calling the bank shareholders with a fair profit is in part due to our for assistance as their identity is verified with a much higher commitment to remain competitive. We continued to evolve degree of certainty than other methods. our financial solutions to meet the needs of our marketplace, while also introducing new capabilities using innovative Univest’s commitment to offering relevant financial solutions technology to bring added convenience to customers. and assisting customers in achieving their dreams was reflected in our decision to offer the iHELP program. The In January, we introduced a new children’s account featuring iHELP program is a transparent and low-cost private lending the Eaglet Savings Club and two new eaglet mascots – Buck program available through community banks like Univest and Penny. The children’s savings program is designed to to help families afford higher education. As the cost of attract young savers while also encouraging parents and education continues to rise at a much faster pace than grandparents to teach the importance of sound money salaries are growing, we expect this to be an attractive management skills. Our commitment to financial literacy led to solution to students and their parents. a partnership with the American Bankers Association (ABA) in 2011. Univest Bank and Trust Co. was the only bank in eastern Several of the products introduced in 2011 cater to the Pennsylvania to participate in their Race to Save campaign, younger generations. As we seek to build the business for a national challenge launched in honor of the ABA’s 15 long-term success, attracting consumers between the ages year anniversary of Teach Children to Save. Our campaign of 16 and 46 is evermore important. And, what these contributed to a portion of the 61,000 total accounts opened generations value most is the technology they can use to which well-surpassed the set goal of 15,000. make banking and money management easy and convenient. “Charlie’s contributions to Univest are well known, but his personal convictions as a ‘believer’ continue to extend far beyond this Universe. It has been a gift and privilege to be his friend.” – Elaine S. Jocelyn, Univest Customer In addition to supporting children’s financial literacy, Technology has transformed the banking landscape over the last several years. Though we are a community bank, we offer our customers technology-driven convenience solutions. Like many of the larger banks in the country, we have solutions to help individuals and businesses manage their accounts the way they want. Univest offers online solutions, mobile applications, person-to-person funds transfer, daily e-mail alerts, remote deposit capture and other solutions to make banking work whenever and wherever it is convenient Univest became the first community bank in our region to for our customers. provide Anytime Voice ID, a voice identification program available to Univest customers. This service provides added 8 “Chant Engineering has achieved years of record growth because of successful partnerships like we have with Univest.” –L. James Chant, President and Philip E. Chant, Vice President, Chant Engineering “Univest is and has been a partner and key component of the fabric of the Grand View Hospital community, a relationship which has been an important part of our success.” – Michael Keen, Senior Vice President and Chief Financial Officer, Grand View Hospital We’ve come a long way in 135 years. In 1876, we took committed to delivering quality experiences, internally and deposits and provided loans through one office and only externally. While employee morale can be impacted by face-to-face interactions. Today, we provide integrated prolonged tough economic cycles, we have worked hard solutions to the counties of Bucks, Chester and Montgomery, to retain top talent, strengthen experiences and provide fair and the Lehigh Valley through 32 financial service centers compensation for performance. and more than a dozen other delivery channels. Branding Univest. Impacting Communities. Our efforts were noticed and for the sixth consecutive year, Univest was named a Best Place to Work in Pennsylvania – once again ranking among the state’s best large companies based on employee feedback. Our consistent recognition as a Best Place to Work is a tribute to our talented and motivated Over the last year, we elevated the Univest brand and workforce and a reflection of our culture of excellence. increased awareness around our capabilities to not only be known as a local choice, but a convenient and steadfast Our employees also helped us set a new record for financial partner. Promoting our stability and confidence through support to the North Penn United Way in 2011. As part of advertising, social media and event-based initiatives our ongoing financial and volunteer support, we contributed coupled with innovative solutions attracted new relationships a record-setting $132,600 to the North Penn United Way. and reassured customers of the strength of our business. Our successful campaign demonstrates our unwavering In these challenging times, we worked with individuals, to the financial support we provided, our employees businesses and nonprofit organizations to help them volunteered nearly 11,000 hours to charitable organizations realize their goals. Whether experiencing hardships or serving our local communities. support and commitment to make a difference. In addition good times, we realize the long-term benefits of being a true partner. This approach deepens relationships and has been the foundation for many mutually beneficial success stories. These relationships also served as the basis for one branding position, “Let’s move forward together.” “We provide our customers with the same level of plus one service that we want to receive.” – Tara Romanik, Customer Service Center Manager Building relationships and retaining loyal customers doesn’t happen without first having happy, motivated employees. At Univest, we take great pride in and are In the summer, we participated as a presenting sponsor for the third consecutive year at the Iron Hill Twilight Criterium professional cycling event in downtown West Chester and 11 as a corporate partner with the Valley Preferred Cycling Journal (PBJ) recognized Univest as the second place winner Center in the Lehigh Valley. In September, we continued our in the large company category for cash donations. We celebration of serving our local communities with the 14th were also recognized overall as one of the top 25 most annual Univest Grand Prix in Souderton and Doylestown. charitable givers in the region. Clearly the events and the “Univest handles all my banking needs; personal, business, estate, and trust accounts, mortgages, and investments. I have found everyone to be pleasant, welcoming, cheerful, helpful, knowledgeable, and I have received a world of guidance and excellent advice, always with a smile.” – Barbara Dudley, Univest Customer Following the Univest Grand Prix, we announced the conclusion of Univest’s title sponsorship of the event. We believe we accomplished the event’s goal of uniting our surrounding communities and the time had come to move forward with a new vision and endeavor to invest in the future success of the communities we serve. In 2012, we are excited to launch our “Committed to Local” effort where Univest will contribute an additional $100,000 to local nonprofit organizations which specifically support youth education and wellness development. In this unprecedented economic climate, our community needs our help in a different way. Nonprofits locally are losing funding streams at the same time the demand for services increases and we want to be there to invest in what our local communities need most. Our ongoing philanthropic support earned us recognition for the third consecutive year. The Philadelphia Business 12 humbling honor from the PBJ show how even in challenging times, Univest takes pride in carrying out our core value of Community and tradition of giving back. Moving Forward Together As we look at the year ahead, we believe we will face another challenging economic time, accentuated by the 2012 election and regulatory activity in Washington. While we have seen some positive trends, we anticipate a slow recovery. Despite these prolonged tough times, we are confident the ongoing disruption in the marketplace will fuel opportunities for Univest to grow and move forward in achieving our vision to be the best integrated financial solutions provider in the market. Our solid foundation and steady growth enables us to continue working side-by-side with customers, shareholders and communities as we help them realize their financial goals. Thank you for your continued support and loyalty. We remain focused and disciplined to ensure Univest has a bright future – providing for you, our valued shareholders, an investment you can rely on and a company of which you can be proud. “I’m motivated by daily interactions with customers and shareholders and the opportunity to share my expertise.” – Irene Grove, Trust Tax Officer “Thanks to Univest, PBS39 is no longer a beacon on a hill, but an accessible gathering place in the heart of the community.” –Patricia C. Simon, President and CEO, PBS39 Univest Corporation of Pennsylvania EXECUTIVE MANAGEMENT TEAM William S. Aichele Chairman, President and Chief Executive Officer K. Leon Moyer Vice Chairman Univest Bank and Trust Co. EXECUTIVE MANAGEMENT TEAM William S. Aichele Chairman K. Leon Moyer President and Chief Executive Officer Jeffrey M. Schweitzer Senior Executive Vice President and Chief Financial Officer Jeffrey M. Schweitzer Senior Executive Vice President and Chief Financial Officer Kenneth D. Hochstetler Senior Executive Vice President Duane J. Brobst Executive Vice President and Chief Risk Officer Louis P. Spinelli Executive Vice President and Director of Consumer Strategy and Delivery Annette D. Szygiel Executive Vice President and Chief Experience Officer OTHER WHOLLY-OWNED SUBSIDIARIES Allied Benefits Group, LLC Delview, Inc. TCG Investment Advisory, Inc. Univest Capital Trust Inc. Univest Delaware, Inc. Univest Reinsurance Corporation Kenneth D. Hochstetler Senior Executive Vice President Duane J. Brobst Executive Vice President and Chief Risk Officer Philip C. Jackson President, Corporate Banking Louis P. Spinelli Executive Vice President and Director of Consumer Strategy and Delivery UNIVEST INVESTMENTS, INC. William S. Aichele, Chairman Kenneth D. Hochstetler, President Jeffrey M. Schweitzer, Secretary/Treasurer UNIVEST INSURANCE, INC. William S. Aichele, Chairman Ronald R. Flaherty, President Jeffrey M. Schweitzer, Secretary/Treasurer UNIVEST CAPITAL, INC. (SUBSIDIARY OF UNIVEST BANK AND TRUST CO.) Hugh W. Connelly, President Jeffrey M. Schweitzer, Secretary/Treasurer Please visit univest.net for a complete list of locations for Univest Corporation and our subsidiaries. “It is a pleasure working with the friendly and responsive retirement services team as they are so helpful to our employees by providing guidance, workshops and meetings to assist with their financial needs.” – Sue Nicol, PHR, Director of Human Resources, Indian Creek Foundation 14 Board of Directors William S. Aichele *† Chairman, President and Chief Executive Officer, K. Leon Moyer†o Vice Chairman, Univest Corporation of Pennsylvania; Chairman, Univest Bank and Trust Co. Douglas C. Clemens* President, Clemens Food Group R. Lee Delp*† Principal, R.L. Delp & Company H. Paul Lewis*† Vice President/Sales Agent Bucks County Commercial Realty, Inc.; Retired Executive Vice President, Univest Bank and Trust Co. H. Ray Mininger* Vice President/Secretary, H. Mininger & Son, Inc. William G. Morral, CPA* Financial Consultant Former CFO of Moyer Packing Company Univest Corporation of Pennsylvania; President and Chief Executive Officer, Univest Bank and Trust Co. Mark A. Schlosser* Secretary/Treasurer, Schlosser Steel, Inc. P. Gregory Shelly*† President, Shelly Enterprises, Inc. Margaret K. Zook* Board Chair, The Penn Foundation; Retired Executive Director, Souderton Mennonite Homes * Director of Univest Corporation of Pennsylvania † Director of Univest Bank and Trust Co. o Alternate Director of Univest Corporation of Pennsylvania “In today’s business climate it is more important than ever to partner with companies that add value through their expert knowledge and experience. Univest’s compliance guidance, customer service and employee support have been invaluable to us. They are truly an essential part of our team.” – Susan Deegan, Human Resources Manager, Proconex, Inc. 15 Shareholder Information SHAREHOLDERS’ MEETING The Annual Shareholders’ Meeting will take place at 10:45 a.m., Tuesday, April 17, 2012, in the Board Room at Univest Plaza, 14 North Main Street, Souderton, Pennsylvania. UNIVEST STOCK TRANSFER AGENT For more information on Univest Corporation of Pennsylvania common stock, please call Broadridge Corporate Issuer Solutions at 610.649.7300 or contact them at 1717 Arch Street, Suite 1300, Philadelphia, PA 19103. You may also click on our investor relations link at www.univest.net. UNIVEST SHAREHOLDER INFORMATION HOTLINE For more information on Univest Corporation of Pennsylvania, please call 877.723.5571 or 215.721.2434. COMMON STOCK INFORMATION Traded on the NASDAQ National Market, Symbol: UVSP. MARKET MAKERS FOR UNIVEST CORPORATION OF PENNSYLVANIA COMMON STOCK Boenning & Scattergood, Inc. Goldman, Sachs & Co. Janney Montgomery Scott LLC Keefe Bruyette & Woods, Inc. Morgan Stanley & Co., Inc. UBS Securities LLC Best Place to Work – six consecutive years Honored for three consecutive years for financial contributions Rated 5 Stars by Bauer Financial 16 “Hegivesstrengthtothewearyandincreasesthepoweroftheweak…butthosewhohopeintheLordwillrenewtheirstrength.Theywillsoaronwingslikeeagles;theywillrunandnotgrowweary,theywillwalkandnotbefaint.”-Isaiah40:29Firmly rooted COMMITTED TO GROWTH 2011 annual report Univest Plaza • 14 North Main Street • P.O. Box 64197 • Souderton, PA 18964877.723.5571 • univest.netCharles H. Hoeflich He Was A Founding Father. “Everything God ” IS BECAUSE IS “In a world of wars and rumors of wars, a man stood strong.In a nation turning valueless and immoral, one stood straight.In a financial world where money rules and corrupts, and the more money the more corruption, one stood strong, a financial lifetime untainted.In a world of lies, spin, things politically correct and where the trust is not in them, one man stood always believable.In a world where all things spiritual were derided and scorned, where Christianity is mocked and persecuted, one passionately championed the faith to the end.That man was Charles H. Hoeflich.”*INTERCOLLEGIATE STUDIES INSTITUTE (ISI)“I have never made an important decision regarding ISI’s future without Charles Hoeflich’s exquisite counsel.” Kenneth Cribb Jr., President Emeritus, ISI.Mr. Hoeflich was a founding trustee of the Institute, playing an active and essential role in the organization from its beginning in 1953 right up until his passing. Hoeflich was awarded the ISI’s Lifetime Achievement Award in 2000 and at the same time, the Board unanimously resolved to rename the award in his honor. Mr. Hoeflich told ISI he was involved, “First, because it promotes conservative principles. Second, because its mission is spiritually oriented. Finally, because ISI does what it says it’s going to do.”PENN FOUNDATION“His commitment to community, outstanding business acumen and astute appreciation of the need for mental healthcare were an asset to the founding Board and motivated all those who came in contact with him.” Wayne Mugrauer, President and CEO, Penn Foundation.When first approached with the idea for a community-based mental health facility in the early 1950’s, Mr. Hoeflich immediately got involved, hosting meetings from his beloved Elderberry Farm. He played a vital role in expanding the Board to include its 12 charter members and participated in the legal process to establish our not-for-profit organization. Mr. Hoeflich once told his friends at Penn Foundation, “the community’s needs…must be the criteria for action.”HUMAN RIGHTS FOUNDATION (HRF)“At a time of moral ambivalence in the financial sector, Charlie had a sterling reputation as one of the longest serving bank directors in American financial history.” Thor Halvorssen, President.Mr. Hoeflich was a founding director of the Human Rights Foundation in 2006 and played an essential role up until his passing. He was especially fond of the HRF’s work addressing the plight of victims of human trafficking and that of the numerous political prisoners that languish in jails around the world. He encouraged HRF to pursue its principles and mission with, “vigor and integrity.” WAS MORE THAN A BANKER.A CHRISTIAN. A CONSERVATIVE.* Cover Quote by Don Crawford, Crawford Broadcasting CompanyCharles H. Hoeflich built a legacy and earned deep respect for devoting his life to giving back to his community. His passion for helping others led to a successful 70-year career in community banking. He spent his first 25 years with Philadelphia National Bank before joining us in 1962 as Bank President, when we were known as Union National Bank and Trust Co. and operated with four offices in Montgomery County. Mr. Hoeflich’s experience, leadership and deep respect helped him grow the business from what was a small enterprise at the time, with $14 million in commercial loans and $2.2 million in trust assets, into a robust financial holding company with $2 billion in total assets and a $1 billion trust function. He became President of the Corporation in 1973 and under his leadership; he transitioned Union National Bank and Trust Co. into Univest Corporation and began laying the framework for future expansion and growth opportunities. He served as Chairman of the Corporation and the Bank from 1978 until his retirement in 1986. Although retired, Mr. Hoeflich did not rest. He remained dedicated to the industry and Univest, and his passion for banking, relationship building and helping individuals in need. In 1986, Univest named him Chairman Emeritus of the Board, a title he retained even after retiring from the Board in May, 2011. Mr. Hoeflich was humble yet sincere, giving credit to the employees most often for their contributions and addressing each and every one of us as a member of “the family,” a tradition we continue today. In one excerpt he wrote, “Indeed, mere words of thanks seem an inadequate expression of the gratitude I feel toward each member of the Union National family and I commend them all to the shareholders for their faithfulness.” While we remember Mr. Hoeflich and acknowledge his untiring and self-sacrificing contributions to Univest – the employees, customers, shareholders, and our communities – his legacy will undoubtedly live on through us. Charles H. Hoeflich Recognized as a hero and saint for his: Intelligence Confidence Integrity Business acumen Quick wit Caring nature Christianity Pervasive gratitude Prudent leadership Philanthropy Calmness Balance Engaging conversationalist Dry sense of humor Loyalty He was a father figure and a true mentor, teaching not just with words but by example. “I’veknownCharliesinceIwas21.HehiredmeandIwasinaweofhimatfirst.Today,Ifeelblessedtohaveknownhimasmymentor,afriend,afatherfigureandacommunityleader.IlearnedsomuchfromhimandwillcontinuetoworkalongwiththeemployeesatUnivesttoliveuptotheveryhigheststandardsheset.”-WilliamS.Aichele,Chairman,PresidentandCEO,UnivestCorporation

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