Univest Financial
Annual Report 2019

Plain-text annual report

Poised for Growth Shareholder Information Our Franchise Investing in the business was a continued focus in 2019 – in people, technology and in the products and services we provide. As we look forward, we will continue to evolve our efforts to expand our reach, increase productivity, optimize operations and gain efficiencies. With strong momentum, solid pipelines and a dedication to the customer experience, we remain confident in our ability to remain relevant and differentiate Univest in this competitive financial industry. Univest is well positioned to grow and dedicated to building the business with an innovative approach that allows us to maintain our independence as well as our unwavering commitment to serving the communities in which we operate. Thank you for your ongoing trust and investment. We look forward to continuing to support our customers, our communities and each other while providing a fair return to our loyal shareholders. The Univest Way Fundamental #1 Always Do the Right Thing Fundamental #2 Have a Growth Mindset Fundamental #3 Practice Servant Leadership Fundamental #4 Invest in Relationships Fundamental #5 Deliver Exceptional Service Fundamental #6 Comply With Regulations Fundamental #7 Don’t Be an Energy Vampire Fundamental #8 Be Nice Fundamental #9 Honor Commitments Fundamental #10 Collaborate Fundamental #11 Attack the Problem, Not the Person Fundamental #12 Give Back Fundamental #13 Provide Solutions Fundamental #14 Assume Positive Intent Fundamental #15 Listen Generously Fundamental #16 Speak Straight Fundamental #17 Celebrate Success Fundamental #18 Have Fun Shareholders’ Meeting The Annual Shareholders’ Meeting will take place at 9:00 a.m. on Wednesday, April 22, 2020 at PineCrest Country Club, 101 Country Club Drive, Lansdale, PA 19446. A buffet breakfast will begin at 8:00 a.m. Univest Stock Transfer Agent For more information on Univest Financial Corporation common stock, please contact Broadridge Corporate Issuer Solutions or visit the investor relations section at www.univest.net. Regular Mail Communications: Overnight Mail Communications: Broadridge Corporate Issuer Solutions, Inc. Broadridge Corporate Issuer Solutions, Inc. PO Box 1342 Brentwood, NY 11717 Phone Number: 866-321-8021 Email Address: shareholder@broadridge.com Website: https://investor.broadridge.com ATTN: IWS 1155 Long Island Avenue Edgewood, NY 11717 Univest Shareholder Contact For more information on Univest Financial Corporation, please call 877.723.5571. Common Stock Information Traded on the NASDAQ National Market, symbol: UVSP. “He gives strength to the weary and increases the power of the weak… but those who hope in the Lord will renew their strength. They will soar on wings like eagles; they will run and not grow weary, they will walk and not be faint.” - Isaiah 40:29, 31 2019 ANNUAL REPORT UNIVEST FINANCIAL CORPORATION 143 YEARS OF BUSINESS SUCCESS 873 EMPLOYEES MAKING IT HAPPEN 39 FINANCIAL CENTERS 11 COMMERCIAL & CORPORATE OFFICES 6 INVESTMENT OFFICES 4 INSURANCE OFFICES 2019 Integrated Successes $3.8b ASSETS UNDER MANAGEMENT AND SUPERVISION $1.1b LOANS SERVICED FOR OTHERS $178m TOTAL INSURANCE WRITTEN PREMIUM $149m EQUIPMENT FINANCE OUTSTANDINGS CORE BANKING OPERATION 75% REVENUE FROM 25% REVENUE FROM NON-BANKING OPERATIONS Poised for Growth Shareholder Information Our Franchise Investing in the business was a continued focus in 2019 – in people, technology and in the products and services we provide. As we look forward, we will continue to evolve our efforts to expand our reach, increase productivity, optimize operations and gain efficiencies. With strong momentum, solid pipelines and a dedication to the customer experience, we remain confident in our ability to remain relevant and differentiate Univest in this competitive financial industry. Univest is well positioned to grow and dedicated to building the business with an innovative approach that allows us to maintain our independence as well as our unwavering commitment to serving the communities in which we operate. Thank you for your ongoing trust and investment. We look forward to continuing to support our customers, our communities and each other while providing a fair return to our loyal shareholders. The Univest Way Fundamental #1 Always Do the Right Thing Fundamental #2 Have a Growth Mindset Fundamental #3 Practice Servant Leadership Fundamental #4 Invest in Relationships Fundamental #5 Deliver Exceptional Service Fundamental #6 Comply With Regulations Fundamental #7 Don’t Be an Energy Vampire Fundamental #8 Be Nice Fundamental #9 Honor Commitments Fundamental #10 Collaborate Fundamental #11 Attack the Problem, Not the Person Fundamental #12 Give Back Fundamental #13 Provide Solutions Fundamental #14 Assume Positive Intent Fundamental #15 Listen Generously Fundamental #16 Speak Straight Fundamental #17 Celebrate Success Fundamental #18 Have Fun Shareholders’ Meeting The Annual Shareholders’ Meeting will take place at 9:00 a.m. on Wednesday, April 22, 2020 at PineCrest Country Club, 101 Country Club Drive, Lansdale, PA 19446. A buffet breakfast will begin at 8:00 a.m. Univest Stock Transfer Agent For more information on Univest Financial Corporation common stock, please contact Broadridge Corporate Issuer Solutions or visit the investor relations section at www.univest.net. Regular Mail Communications: Overnight Mail Communications: Broadridge Corporate Issuer Solutions, Inc. Broadridge Corporate Issuer Solutions, Inc. PO Box 1342 Brentwood, NY 11717 Phone Number: 866-321-8021 Email Address: shareholder@broadridge.com Website: https://investor.broadridge.com ATTN: IWS 1155 Long Island Avenue Edgewood, NY 11717 Univest Shareholder Contact For more information on Univest Financial Corporation, please call 877.723.5571. Common Stock Information Traded on the NASDAQ National Market, symbol: UVSP. “He gives strength to the weary and increases the power of the weak… but those who hope in the Lord will renew their strength. They will soar on wings like eagles; they will run and not grow weary, they will walk and not be faint.” - Isaiah 40:29, 31 2019 ANNUAL REPORT UNIVEST FINANCIAL CORPORATION 143 YEARS OF BUSINESS SUCCESS 873 EMPLOYEES MAKING IT HAPPEN 39 FINANCIAL CENTERS 11 COMMERCIAL & CORPORATE OFFICES 6 INVESTMENT OFFICES 4 INSURANCE OFFICES 2019 Integrated Successes $3.8b ASSETS UNDER MANAGEMENT AND SUPERVISION $1.1b LOANS SERVICED FOR OTHERS $178m TOTAL INSURANCE WRITTEN PREMIUM $149m EQUIPMENT FINANCE OUTSTANDINGS CORE BANKING OPERATION 75% REVENUE FROM 25% REVENUE FROM NON-BANKING OPERATIONS 2019 Financial Performance At December 31, (Dollars in thousands) Cash and interest-earning deposits Investment securities Net loans and leases Other assets Total assets Deposits Borrowings Other liabilities Total liabilities Shareholders’ equity Total liabilities and shareholders’ equity 2019 2018 2017 $ 125,128 441,599 4,351,505 462,692 $ 5,380,924 $ 109,420 473,306 3,977,210 424,411 $ 4,984,347 $ 75,409 454,082 3,598,512 426,859 $ 4,554,862 $ 4,360,075 263,596 82,131 4,705,802 675,122 $ 5,380,924 $ 3,885,933 429,672 44,609 4,360,214 624,133 $ 4,984,347 $ 3,554,919 355,590 40,979 3,951,488 603,374 $ 4,554,862 For the years ended December 31, (Dollars in thousands, except per share data) 2019 2018 2017 Interest income Interest expense Net-interest income Provision for loan and lease losses Net-interest income after provision for loan and lease losses Non-interest income Non-interest expense Net income before income taxes Income taxes Net income Book value per share Net income per share: Basic Diluted Diluted-core1 Dividends declared per share Weighted average shares outstanding Period end shares outstanding 1Excludes restructuring charges. $ 214,093 44,861 169,232 8,518 160,714 65,422 146,083 80,053 14,334 $ 190,488 32,426 158,062 20,310 137,752 60,173 137,239 60,686 10,143 $ 163,015 19,839 143,176 9,892 133,284 59,240 130,713 61,811 17,717 $ 65,719 $ 50,543 $ 44,094 $ 23.01 $ 21.32 $ 20.57 2.24 2.24 2.24 0.80 1.72 1.72 1.74 0.80 1.64 1.64 1.64 0.80 29,299,599 29,334,629 29,370,217 29,270,852 26,861,863 29,334,859 $4,800,000 $4,400,000 $4,000,000 $3,600,000 $3,200,000 $2,800,000 $2,400,000 $2,000,000 $1,600,000 $1,200,000 $800,000 $400,000 $- $250,000 $200,000 $150,000 $100,000 $50,000 $- $70,000 $65,000 $60,000 $55,000 $50,000 $45,000 $40,000 $35,000 $2.25 $2.00 $1.75 $1.50 $1.25 2019 Financial Highlights Commercial Loans Consumer Loans Residential Real Estate Lease Financings ‘17 ‘18 ‘19 Loan and Lease Outstandings (in Thousands) Non-interest income Net-interest income ‘17 ‘18 Total Revenue (in Thousands) ‘19 ‘17 ‘19 ‘18 Net Income* (in Thousands) *EXCLUDES RESTRUCTURING CHARGES ‘11 $5.4b TOTAL ASSETS 9.60% TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS* 1.26% RETURN ON AVERAGE ASSETS 3.59% NET INTEREST MARGIN 13.82% RETURN ON AVERAGE TANGIBLE COMMON EQUITY* Expanding our Commitment to the Communities we Serve Strengthening our local communities is at the heart of Univest’s culture. We give back to the communities we serve by providing financial support, encouraging employee volunteerism and serving in leadership roles for nonprofits. Over the course of the year, we continued with longtime partnerships while also building new relationships with nonprofit organizations to help support Univest’s growth in expansion markets. • Univest’s Connecting with Community volunteer initiative is one of the pillars of our philanthropy program. In 2019, we provided our employees with 30 half-day service projects to choose from in support of local charitable organizations. In addition to these Connecting with Community opportunities, we encouraged our employees to volunteer independently and they truly brought our community core value to life by volunteering 20,300 hours over the course of the year. • Univest is committed to providing financial education and improving financial literacy in the region. Throughout the year, our employees shared their expertise to educate more than 3,200 students on topics such as saving, budgeting and using credit wisely. • In 2019, we supported the Ronald McDonald House Charities (RMHC®) Room in Our Hearts capital campaign with a $25,000 commitment over the next five years. Additionally, we partnered with RMHC of the Philadelphia Region once again for its Show Your Stripes campaign. Through fundraising sales at Univest’s corporate offices and financial centers, our customers and employees raised more than $6,500. • As part of a four-year commitment, we are contributing $100,000 to Penn Foundation’s Hope Within Reach capital campaign. The donation will help Penn Foundation expand their campus and the behavioral health services they provide our community. • As we continued to expand our presence into Central Pennsylvania, we supported two capital campaigns that will have an impact on communities in Lancaster County. A three-year, $30,000 commitment to the West Lampeter Township Community Foundation’s We’re Taking the Field campaign will improve Village Park and a $10,000 donation over two years will help the Southern End Community Association improve and renovate the outdoor swimming pool in Quarryville. • While the markets we serve continue to expand, we have not lost sight of where it all started. We are proud to be longtime supporters of many nonprofits that operate in the Indian Valley where we were founded including Generations, Montgomery Theater and Dock Mennonite Academy. • During the month of December, we held our eighth annual Caring for Community Giveaway. We had an overwhelming response from the community with more than 8,100 entries on behalf of more than 200 local nonprofit groups. The Kisses for Kyle Foundation was selected as the winner of the $5,000 donation. Philanthropic Year in Review 8% 1% 18% 19% 54% Youth & Education Health & Social Services Community & Economic Development Arts & Culture Other ‘18 ‘17 Diluted Earnings Per Share* *EXCLUDES RESTRUCTURING CHARGES ‘12 ‘19 ‘11 *Tangible common equity represents total shareholders’ equity less goodwill and other intangible assets, but includes servicing rights. $2.0m FINANCIAL CONTRIBUTIONS 486 ORGANIZATIONS SUPPORTED 30 CONNECTING WITH COMMUNITY DAYS 20,300 VOLUNTEER HOURS 3,279 STUDENTS EDUCATED Senior Leadership Team Listing as of January 1, 2020 Jeffrey M. Schweitzer President and Chief Executive Officer, Univest Financial Corporation and Chief Executive Officer, Univest Bank and Trust Co. Michael S. Keim President, Univest Bank and Trust Co. and Senior Executive Vice President, Univest Financial Corporation Duane J. Brobst Senior Executive Vice President and Chief Credit Officer, Univest Bank and Trust Co. Michael S. Fitzgerald Market President, East Penn & NJ, Univest Bank and Trust Co. Ronald R. Flaherty President, Univest Insurance, LLC Brian Grzebin President, Mortgage Banking, Univest Bank and Trust Co. Thomas J. Jordan, IV Market President, Central PA, Univest Bank and Trust Co. Board of Directors Listing as of January 1, 2020 William S. Aichele Chairman, Univest Financial Corporation and Univest Bank and Trust Co.; Retired President and Chief Executive Officer, Univest Financial Corporation Roger H. Ballou Former Director, President and Chief Executive Officer, CDI Corporation; Director, Alliance Data Systems and RCM Technologies, Inc. Todd S. Benning Principal, DunlapSLK, PC Glenn E. Moyer Chief Executive Officer, Live Oak Strategies, LLC; Director, FHL Bank Pittsburgh K. Leon Moyer Retired President and Chief Executive Officer, Univest Bank and Trust Co. Natalye Paquin, Esq. President and Chief Executive Officer, Points of Light Foundation Thomas M. Petro Managing Partner, 1867 Capital Partners, LLC; Former President and Chief Executive Officer, Fox Chase Bancorp Kevin B. Norris President, Girard, a Univest Wealth Division Megan D. Santana, Esq. Senior Executive Vice President, Chief Risk Officer, General Counsel and Corporate Secretary, Univest Financial Corporation and Univest Bank and Trust Co. Dana E. Brown Executive Vice President, Consumer Services, Univest Bank and Trust Co. Eric W. Conner Executive Vice President and Chief Information Officer, Univest Financial Corporation Brian J. Richardson Executive Vice President and Chief Financial Officer, Univest Financial Corporation and Univest Bank and Trust Co. M. Theresa Schwartzer Executive Vice President and Director of Human Resources, Univest Financial Corporation Annette D. Szygiel Executive Vice President and Chief Experience Officer, Univest Financial Corporation Jeffrey M. Schweitzer President and Chief Executive Officer, Univest Financial Corporation and Chief Executive Officer, Univest Bank and Trust Co. Michael L. Turner, Esq. Partner, Marshall Dennehey Warner Coleman & Goggin Robert C. Wonderling President and Chief Executive Officer, Greater Philadelphia Chamber of Commerce Charles H. Zimmerman Senior Leadership, Calvary Church of Souderton; Director, Clemens Family Corporation Suzanne Keenan (Alternate Director) Member of the Board of Trustees of North American Electric Reliability Corporation; Member of SAP Independent Executive Advisory Council; Member of Rocket Wagon’s Advisory Council; Member of Boston Digital’s Advisory Council Wholly-Owned Subsidiaries Univest Bank and Trust Co. Girard Investment Services, LLC Univest Capital, Inc. Girard Pension Services, LLC Univest Insurance, LLC Davisville Associates, LLC Girard Advisory Services, LLC 104 S. Oakland Ave., LLC Girard Benefits Group, LLC Please visit univest.net for a complete list of locations for Univest Financial Corporation and our subsidiaries. Poised for Growth Shareholder Information Our Franchise Investing in the business was a continued focus in 2019 – in people, technology and in the products and services we provide. As we look forward, we will continue to evolve our efforts to expand our reach, increase productivity, optimize operations and gain efficiencies. With strong momentum, solid pipelines and a dedication to the customer experience, we remain confident in our ability to remain relevant and differentiate Univest in this competitive financial industry. Univest is well positioned to grow and dedicated to building the business with an innovative approach that allows us to maintain our independence as well as our unwavering commitment to serving the communities in which we operate. Thank you for your ongoing trust and investment. We look forward to continuing to support our customers, our communities and each other while providing a fair return to our loyal shareholders. The Univest Way Fundamental #1 Always Do the Right Thing Fundamental #2 Have a Growth Mindset Fundamental #3 Practice Servant Leadership Fundamental #4 Invest in Relationships Fundamental #5 Deliver Exceptional Service Fundamental #6 Comply With Regulations Fundamental #7 Don’t Be an Energy Vampire Fundamental #8 Be Nice Fundamental #9 Honor Commitments Fundamental #10 Collaborate Fundamental #11 Attack the Problem, Not the Person Fundamental #12 Give Back Fundamental #13 Provide Solutions Fundamental #14 Assume Positive Intent Fundamental #15 Listen Generously Fundamental #16 Speak Straight Fundamental #17 Celebrate Success Fundamental #18 Have Fun Shareholders’ Meeting The Annual Shareholders’ Meeting will take place at 9:00 a.m. on Wednesday, April 22, 2020 at PineCrest Country Club, 101 Country Club Drive, Lansdale, PA 19446. A buffet breakfast will begin at 8:00 a.m. Univest Stock Transfer Agent For more information on Univest Financial Corporation common stock, please contact Broadridge Corporate Issuer Solutions or visit the investor relations section at www.univest.net. Regular Mail Communications: Overnight Mail Communications: Broadridge Corporate Issuer Solutions, Inc. Broadridge Corporate Issuer Solutions, Inc. PO Box 1342 Brentwood, NY 11717 Phone Number: 866-321-8021 Email Address: shareholder@broadridge.com Website: https://investor.broadridge.com ATTN: IWS 1155 Long Island Avenue Edgewood, NY 11717 Univest Shareholder Contact For more information on Univest Financial Corporation, please call 877.723.5571. Common Stock Information Traded on the NASDAQ National Market, symbol: UVSP. “He gives strength to the weary and increases the power of the weak… but those who hope in the Lord will renew their strength. They will soar on wings like eagles; they will run and not grow weary, they will walk and not be faint.” - Isaiah 40:29, 31 2019 ANNUAL REPORT UNIVEST FINANCIAL CORPORATION 143 YEARS OF BUSINESS SUCCESS 873 EMPLOYEES MAKING IT HAPPEN 39 FINANCIAL CENTERS 11 COMMERCIAL & CORPORATE OFFICES 6 INVESTMENT OFFICES 4 INSURANCE OFFICES 2019 Integrated Successes $3.8b ASSETS UNDER MANAGEMENT AND SUPERVISION $1.1b LOANS SERVICED FOR OTHERS $178m TOTAL INSURANCE WRITTEN PREMIUM $149m EQUIPMENT FINANCE OUTSTANDINGS CORE BANKING OPERATION 75% REVENUE FROM 25% REVENUE FROM NON-BANKING OPERATIONS 2019 Highlights A letter from our Chairman, President and CEO Embracing Human Capital To be successful, we need to not only retain our high-performing employees, but also attract new individuals. By proactively assessing human capital needs, including what skills will be necessary in the next three to five years, we can ensure Univest is prepared for growth. • Throughout 2019, we focused on attracting highly-talented individuals who align with Univest’s business goals and culture. Strategies included using artificial intelligence software to target potential applicants, grassroots initiatives and building our employer brand through social media and digital marketing initiatives. • We remain committed to retaining and engaging our current employees. Univest University, our corporate training and development program, delivered 8,100 training hours over the course of the year and saw the number of attendees increase 41% over 2018. New programs included Women’s Leadership, Negotiation Skills and Business Writing. • In 2019, we began utilizing video conferencing as a way of training in multiple locations at one time. Enhancing Brand Equity • In support of our efforts to improve our digital offerings, we launched the Live Life. Stay Connected campaign on radio, digital and social media in the Greater Philadelphia market as well as our expansion markets. The goal of the campaign was to increase awareness of our digital capabilities, emphasizing security while striking a balance between technology and the human touch. • To build further awareness of our financing solutions for businesses, we introduced a commercial banking campaign featuring testimonials from longstanding clients to highlight our solutions as well as our focus on building relationships. The campaign included video and static advertising via digital and social media platforms, print advertising and Google search. • We also continued to build awareness of our agricultural and commercial lending teams in the Lancaster market with Serving Families like Yours for Generations messaging. In addition, we supported our new commercial lending teams with People you Trust. A Bank to Believe In. messaging through direct mail, billboards, print and digital advertising. • The new Girard, a Univest Wealth Division, brand was introduced. Throughout the year, advertising and public relations campaigns raised awareness for Girard and its capabilities. Dedicated Girard social media pages were launched on Facebook, Twitter and LinkedIn enabling us to further distribute secured media and authored content to raise brand visibility and build our position as thought leaders in the wealth arena. Print advertising and digital marketing increased brand visibility and drove traffic to meetgirard.com. • In addition to advertising, we continued to build brand awareness for Univest through several high-visibility sponsorships that also supported our local communities. Some highlights included serving as the sustaining sponsor of Spruce Street Harbor Park in Philadelphia for our fifth year, returning as presenting sponsor of Christkindlmarkt in Bethlehem, continuing as the lead sponsor of the Univest Performance Center in Quakertown, Bucks County, maintaining our partnership with the Saint Joseph’s University Athletic Department and sponsoring the “Univest Quote of the Day” on WFMZ-TV in the Lehigh Valley. • Through Univest-hosted events, we strengthened relationships with our existing customers while also helping us win new business opportunities and build brand awareness with the more than 2,200 attendees over the course of the year. • On our corporate social media pages, we continue to share informative blog articles written by our line of business experts to position Univest as a trusted resource and thought leader. In addition, our social media channels allow us to humanize our brand which helps to build loyalty. In our first full year on Instagram, we saw excellent engagement as we highlighted our #CommittedToLocal efforts and shared fun #UnivestFamily moments. Making DIGITAL CONNECTIONS 18.8m DIGITAL ADVERTISING IMPRESSIONS 3.4m SOCIAL CONTENT IMPRESSIONS 77k DIGITAL ADVERTISING ENGAGEMENTS 140k SOCIAL CONTENT ENGAGEMENTS To our family of shareholders, customers and employees: As we reflect on this past year, we are pleased to share 2019 was a strong year for Univest Financial Corporation. Our solid performance was achieved by a continued focus on organic growth while being opportunistic with strategic investments in our brand, people and technology. Guided by a robust strategic plan, we evolved the business, expanded into new markets, improved operational efficiency and strengthened our competitive position. Even as we innovate and adapt, our healthy corporate culture keeps us focused on living out our core values of tradition, excellence, integrity, community and spirituality as we drive performance and achieve our independence. Over the course of the year, we saw solid loan and deposit growth thanks to a strong local economy and our ability to continue to capitalize on the disruption in our markets caused by mergers and acquisitions. As part of our ongoing focus to grow the business organically, we expanded our commercial banking team in Central Pennsylvania which we anticipate will be a significant driver of our growth. This team will focus on increasing Univest’s presence in western Lancaster County as well as extending our footprint to Cumberland, Dauphin and York counties. In addition, we grew our commercial lending team in South Jersey and will be opening a loan production office in Moorestown, New Jersey early in 2020 to support this regional expansion. We are confident Univest’s local decision making, stability and breadth of services will resonate well with the business community in these additional markets. Jeffrey M. Schweitzer, William S. Aichele During the year, our disciplined business approach fueled organic growth, strong sales execution across all our subsidiaries and allowed us to continue investing in the business. We were dedicated to advancing the progress of our corporate strategic initiatives including our digital evolution and use of technology to remain competitive, enrich the experience of our customers and improve efficiencies. While we continue to invest in technology, we will never forget what makes us successful – our employees and the care they show our customers. Offering a combined approach of strong relationship building and technology will allow us to continue to provide the exceptional service for which Univest is known. Another highlight for the year was being one of only 30 banks named to Sandler O’Neill’s Sm-All Stars Class of 2019. As Sandler O’Neill explains, “The objective of the Sm-All Stars…is to identify the top performing small-cap banks and thrifts in the country. In doing this, we hope to uncover the next crop of stellar mid-cap banks before they are discovered by the rest of the world.” To earn Sm-All Star status, companies needed to have a market cap below $2.5 billion and have superior performance metrics related to growth, profitability, credit quality and capital strength. We are proud of this recognition as it truly demonstrates the strength of our franchise and the value we provide our customers, shareholders, employees and communities. Throughout our history, we have been blessed with strong, servant leaders who have strategically guided us through both good and challenging times. We are excited to welcome Suzanne Keenan as an Alternate Director. As a member of the Board of Trustees of North American Electric Reliability Corporation and former Chief Information Officer for Wawa, Inc., we are confident her experience and insight will help us move the business forward. As you review the 2019 annual report, we trust you will be pleased with our accomplishments and plans for continued growth and longevity. We have strong momentum and are well positioned to seize opportunities, strengthen our franchise and enhance shareholder value. On behalf of the entire Univest family, thank you for your support and investment. Sincerely, William S. Aichele Chairman Jeffrey M. Schweitzer President and CEO 2019 Highlights Growing the Business Organically Univest Financial Corporation’s strong performance in 2019 is a direct result of the daily contributions of more than 870 employees. It was a year of robust loan and deposit growth as we worked to evolve the business, expand regionally, further penetrate existing relationships and improve operational efficiency. Together, we achieved the following highlights. • The mortgage banking division finished the year funding more than $340 million of residential mortgages and more than $50 million in consumer loans. On the residential side, fundings were up by more than 20% year over year as rates dropped in the third quarter which prompted an increase in refinance activity. Purchase driven mortgage closings were also strong thanks to the solid economy and positive home buyer sentiment. • Driven by a strong local economy, our ability to continue to capitalize on the disruption in our markets and our regional • On the consumer side of the Bank, Dana Brown, Executive Vice President of Consumer Services, took over expansion, our loan portfolio grew $380.3 million, or 9.5%. • Our goal continues to be funding our loan growth with deposits. In 2019, we grew deposits by $474.1 million, or 12.2% and our loan-to-deposit ratio averaged 99.1%. Deposit growth was driven by concerted plans and tactics executed by our commercial, consumer, municipal and treasury management teams with the largest dollar growth segment being public funds of $201.9 million. • As part of our ongoing focus to grow the business organically, we expanded our commercial banking team in Central Pennsylvania which we anticipate will be a significant driver of our growth as it saw loan volume increase 52.4% and deposits grew 42.5% for the year. The new team members will focus on increasing Univest’s presence in western Lancaster County as well as extending our footprint to Cumberland, Dauphin and York counties. • We also grew our commercial lending team in South Jersey and will be opening a loan production office in Moorestown, New Jersey early in 2020 to support this regional expansion. In the Lehigh Valley, we are focused on growing both our commercial and industrial and commercial real estate teams and see these as areas of continued growth for 2020 and beyond. • As we expanded our teams and regional reach, we realigned our commercial banking markets. Led by Michael Fitzgerald, the East Penn and NJ market consists of the Pennsylvania counties of Berks, Bucks, Chester, Delaware, Lehigh, Montgomery, Northampton and Philadelphia as well as the New Jersey counties of Atlantic, Burlington, Camden and Cape May. The Central PA market is led by Thomas Jordan and encompasses the Pennsylvania counties of Cumberland, Dauphin, Lancaster, Lebanon and York. • Treasury management had another record year for fee income largely attributed to the new insured cash sweep product which provides customers with an expanded FDIC insurance option. By year end, balances grew to $80 million. In addition to fee income, treasury management solutions played an integral role in gathering deposits. The treasury management team continues to grow and hired three new team members over the course of the year including a product manager to support further growth. • We expanded our commercial product offering to include asset based lending, an important complement to our existing loan product offerings that allows us to provide working capital financing to companies that need a different financing solution than a traditional line of credit. Over the course of the year, we put the people, policies and systems in place that will allow us to further our opportunity for growth in the years ahead. • Our securities backed lines of credit available to clients of Girard, a Univest Wealth Division is expected to be a significant opportunity in the years ahead as it is rolled out on a larger scale. • Our SBA lending team had a strong year closing $14.2 million in loans and ranking 11th in dollar volume for SBA 7a loans in the Eastern Pennsylvania District. • Univest Capital had a strong year in 2019 and ended the year with $149 million in equipment finance outstandings. Univest Capital focused on niche growth opportunities including financing medical equipment as well as providing financing for solar power projects for nonprofits, municipalities and school districts. Univest Capital also launched a consumer financing program with a large tractor manufacturer. $380.3m LOAN GROWTH FOR THE YEAR ENDED DECEMBER 31, 2019 Strong Organic Banking Growth $474.1m 9.5% LOAN GROWTH FOR THE YEAR ENDED DECEMBER 31, 2019 DEPOSIT GROWTH FOR THE YEAR ENDED DECEMBER 31, 2019 12.2% DEPOSIT GROWTH FOR THE YEAR ENDED DECEMBER 31, 2019 management of the five financial centers located in Lancaster County. In addition, the other regional markets were consolidated. These adjustments will ensure consistency of our consumer operation across our entire footprint and streamline our approach to service and sales. • We are committed to hiring the right people to help ensure the success of the consumer bank. New positions to support this growth include a director of strategic initiatives who will focus on customer experience and employee development and the addition of business development officers in the Lehigh Valley and Philadelphia markets who will work to build Main Street opportunities. • We also launched the Univest Business Banking Express product designed specifically for small businesses and sold through our financial center network to Main Street businesses with commercial borrowing needs from $5,000 - $100,000. • While the Bank continues to be our largest subsidiary and deliver strong results, we also continue to see the benefit of our diversified business model with Univest Insurance and Girard contributing to our successful year with noninterest income totaling $65.4 million, an increase of $5.2 million, or 8.7% for the year. • At the start of 2019, we adopted Girard as the common brand for the Univest Wealth Division. Establishing three pillars of planning, advice and wealth solutions under one cohesive brand has allowed us to gain efficiencies in sales, marketing and delivery. This common brand positions Girard as an independent, full-service wealth firm backed by the strength and stability of Univest. • The rebrand has been well received by current and new clients as well as the media. It was a year of strong growth as the division reached a new record of $3.8 billion for assets under management and supervision including nearly $285 million in new business. • Univest Insurance continued to experience strong organic growth led by solid new business sales coupled with strong client retention. Through the growth of risk management services and human resources consulting, the value proposition offered by Univest Insurance continued to be enhanced which helped support sales with larger commercial clients. Maximizing Technology to Improve Efficiency Over the course of the year, we proactively introduced technology to our business model to remain competitive, meet the expectations of our customers and improve efficiencies. • We launched a new online banking platform and mobile app for the consumer bank. These digital banking systems deliver a consistent look and feature increased security, a modern interface, and the ability to securely chat with our customer support team. • In addition to the banking app, we launched a Girard branded wealth app and an app for Univest Insurance clients. • We continued to leverage the power of nCino to create a streamlined commercial loan origination system. Our focus is on the end-to-end processing and closing of commercial loans with an initial focus on loan amounts of $1.0 million and less. Key accomplishments in 2019 included the successful rollout to select members of our Central PA commercial banking team, completion of credit integration and the creation of an approval scorecard for subsequent validation. nCino is also being used to facilitate the Univest Business Banking Express product allowing for faster decision making and quicker loan bookings. • Salesforce was fully implemented in 2018 as a sales and customer relationship management tool, giving us a 360-degree view of customer relationships. In 2019, we expanded the use of Salesforce to our customer support team, automated a number of administrative processes utilizing Salesforce and implemented Salesforce Marketing Cloud. In 2020, a data- driven approach to using Salesforce Marketing Cloud will be critical to the success of a marketing strategy that leverages technology and automation to boost awareness of our comprehensive suite of financial solutions and foster penetration of our existing consumer relationships with the goal of increased profitability. 2019 Highlights A letter from our Chairman, President and CEO Embracing Human Capital To be successful, we need to not only retain our high-performing employees, but also attract new individuals. By proactively assessing human capital needs, including what skills will be necessary in the next three to five years, we can ensure Univest is prepared for growth. • Throughout 2019, we focused on attracting highly-talented individuals who align with Univest’s business goals and culture. Strategies included using artificial intelligence software to target potential applicants, grassroots initiatives and building our employer brand through social media and digital marketing initiatives. • We remain committed to retaining and engaging our current employees. Univest University, our corporate training and development program, delivered 8,100 training hours over the course of the year and saw the number of attendees increase 41% over 2018. New programs included Women’s Leadership, Negotiation Skills and Business Writing. • In 2019, we began utilizing video conferencing as a way of training in multiple locations at one time. Enhancing Brand Equity • In support of our efforts to improve our digital offerings, we launched the Live Life. Stay Connected campaign on radio, digital and social media in the Greater Philadelphia market as well as our expansion markets. The goal of the campaign was to increase awareness of our digital capabilities, emphasizing security while striking a balance between technology and the human touch. • To build further awareness of our financing solutions for businesses, we introduced a commercial banking campaign featuring testimonials from longstanding clients to highlight our solutions as well as our focus on building relationships. The campaign included video and static advertising via digital and social media platforms, print advertising and Google search. • We also continued to build awareness of our agricultural and commercial lending teams in the Lancaster market with Serving Families like Yours for Generations messaging. In addition, we supported our new commercial lending teams with People you Trust. A Bank to Believe In. messaging through direct mail, billboards, print and digital advertising. • The new Girard, a Univest Wealth Division, brand was introduced. Throughout the year, advertising and public relations campaigns raised awareness for Girard and its capabilities. Dedicated Girard social media pages were launched on Facebook, Twitter and LinkedIn enabling us to further distribute secured media and authored content to raise brand visibility and build our position as thought leaders in the wealth arena. Print advertising and digital marketing increased brand visibility and drove traffic to meetgirard.com. • In addition to advertising, we continued to build brand awareness for Univest through several high-visibility sponsorships that also supported our local communities. Some highlights included serving as the sustaining sponsor of Spruce Street Harbor Park in Philadelphia for our fifth year, returning as presenting sponsor of Christkindlmarkt in Bethlehem, continuing as the lead sponsor of the Univest Performance Center in Quakertown, Bucks County, maintaining our partnership with the Saint Joseph’s University Athletic Department and sponsoring the “Univest Quote of the Day” on WFMZ-TV in the Lehigh Valley. • Through Univest-hosted events, we strengthened relationships with our existing customers while also helping us win new business opportunities and build brand awareness with the more than 2,200 attendees over the course of the year. • On our corporate social media pages, we continue to share informative blog articles written by our line of business experts to position Univest as a trusted resource and thought leader. In addition, our social media channels allow us to humanize our brand which helps to build loyalty. In our first full year on Instagram, we saw excellent engagement as we highlighted our #CommittedToLocal efforts and shared fun #UnivestFamily moments. Making DIGITAL CONNECTIONS 18.8m DIGITAL ADVERTISING IMPRESSIONS 3.4m SOCIAL CONTENT IMPRESSIONS 77k DIGITAL ADVERTISING ENGAGEMENTS 140k SOCIAL CONTENT ENGAGEMENTS To our family of shareholders, customers and employees: As we reflect on this past year, we are pleased to share 2019 was a strong year for Univest Financial Corporation. Our solid performance was achieved by a continued focus on organic growth while being opportunistic with strategic investments in our brand, people and technology. Guided by a robust strategic plan, we evolved the business, expanded into new markets, improved operational efficiency and strengthened our competitive position. Even as we innovate and adapt, our healthy corporate culture keeps us focused on living out our core values of tradition, excellence, integrity, community and spirituality as we drive performance and achieve our independence. Over the course of the year, we saw solid loan and deposit growth thanks to a strong local economy and our ability to continue to capitalize on the disruption in our markets caused by mergers and acquisitions. As part of our ongoing focus to grow the business organically, we expanded our commercial banking team in Central Pennsylvania which we anticipate will be a significant driver of our growth. This team will focus on increasing Univest’s presence in western Lancaster County as well as extending our footprint to Cumberland, Dauphin and York counties. In addition, we grew our commercial lending team in South Jersey and will be opening a loan production office in Moorestown, New Jersey early in 2020 to support this regional expansion. We are confident Univest’s local decision making, stability and breadth of services will resonate well with the business community in these additional markets. Jeffrey M. Schweitzer, William S. Aichele During the year, our disciplined business approach fueled organic growth, strong sales execution across all our subsidiaries and allowed us to continue investing in the business. We were dedicated to advancing the progress of our corporate strategic initiatives including our digital evolution and use of technology to remain competitive, enrich the experience of our customers and improve efficiencies. While we continue to invest in technology, we will never forget what makes us successful – our employees and the care they show our customers. Offering a combined approach of strong relationship building and technology will allow us to continue to provide the exceptional service for which Univest is known. Another highlight for the year was being one of only 30 banks named to Sandler O’Neill’s Sm-All Stars Class of 2019. As Sandler O’Neill explains, “The objective of the Sm-All Stars…is to identify the top performing small-cap banks and thrifts in the country. In doing this, we hope to uncover the next crop of stellar mid-cap banks before they are discovered by the rest of the world.” To earn Sm-All Star status, companies needed to have a market cap below $2.5 billion and have superior performance metrics related to growth, profitability, credit quality and capital strength. We are proud of this recognition as it truly demonstrates the strength of our franchise and the value we provide our customers, shareholders, employees and communities. Throughout our history, we have been blessed with strong, servant leaders who have strategically guided us through both good and challenging times. We are excited to welcome Suzanne Keenan as an Alternate Director. As a member of the Board of Trustees of North American Electric Reliability Corporation and former Chief Information Officer for Wawa, Inc., we are confident her experience and insight will help us move the business forward. As you review the 2019 annual report, we trust you will be pleased with our accomplishments and plans for continued growth and longevity. We have strong momentum and are well-positioned to seize opportunities, strengthen our franchise and enhance shareholder value. On behalf of the entire Univest family, thank you for your support and investment. Sincerely, William S. Aichele Chairman Jeffrey M. Schweitzer President and CEO 2019 Financial Performance At December 31, (Dollars in thousands) Cash and interest-earning deposits Investment securities Net loans and leases Other assets Total assets Deposits Borrowings Other liabilities Total liabilities Shareholders’ equity Total liabilities and shareholders’ equity 2019 2018 2017 $ 125,128 441,599 4,351,505 462,692 $ 5,380,924 $ 109,420 473,306 3,977,210 424,411 $ 4,984,347 $ 75,409 454,082 3,598,512 426,859 $ 4,554,862 $ 4,360,075 263,596 82,131 4,705,802 675,122 $ 5,380,924 $ 3,885,933 429,672 44,609 4,360,214 624,133 $ 4,984,347 $ 3,554,919 355,590 40,979 3,951,488 603,374 $ 4,554,862 For the years ended December 31, (Dollars in thousands, except per share data) 2019 2018 2017 Interest income Interest expense Net-interest income Provision for loan and lease losses Net-interest income after provision for loan and lease losses Non-interest income Non-interest expense Net income before income taxes Income taxes Net income Book value per share Net income per share: Basic Diluted Diluted-core1 Dividends declared per share Weighted average shares outstanding Period end shares outstanding 1Excludes restructuring charges. $ 214,093 44,861 169,232 8,518 160,714 65,422 146,083 80,053 14,334 $ 190,488 32,426 158,062 20,310 137,752 60,173 137,239 60,686 10,143 $ 163,015 19,839 143,176 9,892 133,284 59,240 130,713 61,811 17,717 $ 65,719 $ 50,543 $ 44,094 $ 23.01 $ 21.32 $ 20.57 2.24 2.24 2.24 0.80 1.72 1.72 1.74 0.80 1.64 1.64 1.64 0.80 29,299,599 29,334,629 29,370,217 29,270,852 26,861,863 29,334,859 $4,800,000 $4,400,000 $4,000,000 $3,600,000 $3,200,000 $2,800,000 $2,400,000 $2,000,000 $1,600,000 $1,200,000 $800,000 $400,000 $- $250,000 $200,000 $150,000 $100,000 $50,000 $- $70,000 $65,000 $60,000 $55,000 $50,000 $45,000 $40,000 $35,000 $2.25 $2.00 $1.75 $1.50 $1.25 2019 Financial Highlights Commercial Loans Consumer Loans Residential Real Estate Lease Financings ‘17 ‘18 ‘19 Loan and Lease Outstandings (in Thousands) Non-interest income Net-interest income ‘17 ‘18 Total Revenue (in Thousands) ‘19 ‘17 ‘19 ‘18 Net Income* (in Thousands) *EXCLUDES RESTRUCTURING CHARGES ‘11 $5.4b TOTAL ASSETS 9.60% TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS* 1.26% RETURN ON AVERAGE ASSETS 3.59% NET INTEREST MARGIN 13.82% RETURN ON AVERAGE TANGIBLE COMMON EQUITY* Expanding our Commitment to the Communities we Serve Strengthening our local communities is at the heart of Univest’s culture. We give back to the communities we serve by providing financial support, encouraging employee volunteerism and serving in leadership roles for nonprofits. Over the course of the year, we continued with longtime partnerships while also building new relationships with nonprofit organizations to help support Univest’s growth in expansion markets. • Univest’s Connecting with Community volunteer initiative is one of the pillars of our philanthropy program. In 2019, we provided our employees with 30 half-day service projects to choose from in support of local charitable organizations. In addition to these Connecting with Community opportunities, we encouraged our employees to volunteer independently and they truly brought our community core value to life by volunteering 20,300 hours over the course of the year. • Univest is committed to providing financial education and improving financial literacy in the region. Throughout the year, our employees shared their expertise to educate more than 3,200 students on topics such as saving, budgeting and using credit wisely. • In 2019, we supported the Ronald McDonald House Charities (RMHC®) Room in Our Hearts capital campaign with a $25,000 commitment over the next five years. Additionally, we partnered with RMHC of the Philadelphia Region once again for its Show Your Stripes campaign. Through fundraising sales at Univest’s corporate offices and financial centers, our customers and employees raised more than $6,500. • As part of a four-year commitment, we are contributing $100,000 to Penn Foundation’s Hope Within Reach capital campaign. The donation will help Penn Foundation expand their campus and the behavioral health services they provide our community. • As we continued to expand our presence into Central Pennsylvania, we supported two capital campaigns that will have an impact on communities in Lancaster County. A three-year, $30,000 commitment to the West Lampeter Township Community Foundation’s We’re Taking the Field campaign will improve Village Park and a $10,000 donation over two years will help the Southern End Community Association improve and renovate the outdoor swimming pool in Quarryville. • While the markets we serve continue to expand, we have not lost sight of where it all started. We are proud to be longtime supporters of many nonprofits that operate in the Indian Valley where we were founded including Generations, Montgomery Theater and Dock Mennonite Academy. • During the month of December, we held our eighth annual Caring for Community Giveaway. We had an overwhelming response from the community with more than 8,100 entries on behalf of more than 200 local nonprofit groups. The Kisses for Kyle Foundation was selected as the winner of the $5,000 donation. Philanthropic Year in Review 8% 1% 18% 19% 54% Youth & Education Health & Social Services Community & Economic Development Arts & Culture Other ‘18 ‘17 Diluted Earnings Per Share* *EXCLUDES RESTRUCTURING CHARGES ‘12 ‘11 ‘19 *Tangible common equity represents total shareholders’ equity less goodwill and other intangible assets, but includes servicing rights. $2.0m FINANCIAL CONTRIBUTIONS 486 ORGANIZATIONS SUPPORTED 30 CONNECTING WITH COMMUNITY DAYS 20,300 VOLUNTEER HOURS 3,279 STUDENTS EDUCATED Senior Leadership Team Listing as of January 1, 2020 Jeffrey M. Schweitzer President and Chief Executive Officer, Univest Financial Corporation and Chief Executive Officer, Univest Bank and Trust Co. Michael S. Keim President, Univest Bank and Trust Co. and Senior Executive Vice President, Univest Financial Corporation Duane J. Brobst Senior Executive Vice President and Chief Credit Officer, Univest Bank and Trust Co. Michael S. Fitzgerald Market President, East Penn & NJ, Univest Bank and Trust Co. Ronald R. Flaherty President, Univest Insurance, LLC Brian Grzebin President, Mortgage Banking, Univest Bank and Trust Co. Thomas J. Jordan, IV Market President, Central PA, Univest Bank and Trust Co. Board of Directors Listing as of January 1, 2020 William S. Aichele Chairman, Univest Financial Corporation and Univest Bank and Trust Co.; Retired President and Chief Executive Officer, Univest Financial Corporation Roger H. Ballou Former Director, President and Chief Executive Officer, CDI Corporation; Director, Alliance Data Systems and RCM Technologies, Inc. Todd S. Benning Principal, DunlapSLK, PC Glenn E. Moyer Chief Executive Officer, Live Oak Strategies, LLC; Director, FHL Bank Pittsburgh K. Leon Moyer Retired President and Chief Executive Officer, Univest Bank and Trust Co. Natalye Paquin, Esq. President and Chief Executive Officer, Points of Light Foundation Thomas M. Petro Managing Partner, 1867 Capital Partners, LLC; Former President and Chief Executive Officer, Fox Chase Bancorp Kevin B. Norris President, Girard, a Univest Wealth Division Megan D. Santana, Esq. Senior Executive Vice President, Chief Risk Officer, General Counsel and Corporate Secretary, Univest Financial Corporation and Univest Bank and Trust Co. Dana E. Brown Executive Vice President, Consumer Services, Univest Bank and Trust Co. Eric W. Conner Executive Vice President and Chief Information Officer, Univest Financial Corporation Brian J. Richardson Executive Vice President and Chief Financial Officer, Univest Financial Corporation and Univest Bank and Trust Co. M. Theresa Schwartzer Executive Vice President and Director of Human Resources, Univest Financial Corporation Annette D. Szygiel Executive Vice President and Chief Experience Officer, Univest Financial Corporation Jeffrey M. Schweitzer President and Chief Executive Officer, Univest Financial Corporation and Chief Executive Officer, Univest Bank and Trust Co. Michael L. Turner, Esq. Partner, Marshall Dennehey Warner Coleman & Goggin Robert C. Wonderling President and Chief Executive Officer, Greater Philadelphia Chamber of Commerce Charles H. Zimmerman Senior Leadership, Calvary Church of Souderton; Director, Clemens Family Corporation Suzanne Keenan (Alternate Director) Member of the Board of Trustees of North American Electric Reliability Corporation; Member of SAP Independent Executive Advisory Council; Member of Rocket Wagon’s Advisory Council; Member of Boston Digital’s Advisory Council Wholly-Owned Subsidiaries Univest Bank and Trust Co. Girard Investment Services, LLC Univest Capital, Inc. Girard Pension Services, LLC Univest Insurance, LLC Davisville Associates, LLC Girard Advisory Services, LLC 104 S. Oakland Ave., LLC Girard Benefits Group, LLC Please visit univest.net for a complete list of locations for Univest Financial Corporation and our subsidiaries. 2019 Financial Performance At December 31, (Dollars in thousands) Cash and interest-earning deposits Investment securities Net loans and leases Other assets Total assets Deposits Borrowings Other liabilities Total liabilities Shareholders’ equity Total liabilities and shareholders’ equity 2019 2018 2017 $ 125,128 441,599 4,351,505 462,692 $ 5,380,924 $ 109,420 473,306 3,977,210 424,411 $ 4,984,347 $ 75,409 454,082 3,598,512 426,859 $ 4,554,862 $ 4,360,075 263,596 82,131 4,705,802 675,122 $ 5,380,924 $ 3,885,933 429,672 44,609 4,360,214 624,133 $ 4,984,347 $ 3,554,919 355,590 40,979 3,951,488 603,374 $ 4,554,862 For the years ended December 31, (Dollars in thousands, except per share data) 2019 2018 2017 Interest income Interest expense Net-interest income Provision for loan and lease losses Net-interest income after provision for loan and lease losses Non-interest income Non-interest expense Net income before income taxes Income taxes Net income Book value per share Net income per share: Basic Diluted Diluted-core1 Dividends declared per share Weighted average shares outstanding Period end shares outstanding 1Excludes restructuring charges. $ 214,093 44,861 169,232 8,518 160,714 65,422 146,083 80,053 14,334 $ 190,488 32,426 158,062 20,310 137,752 60,173 137,239 60,686 10,143 $ 163,015 19,839 143,176 9,892 133,284 59,240 130,713 61,811 17,717 $ 65,719 $ 50,543 $ 44,094 $ 23.01 $ 21.32 $ 20.57 2.24 2.24 2.24 0.80 1.72 1.72 1.74 0.80 1.64 1.64 1.64 0.80 29,299,599 29,334,629 29,370,217 29,270,852 26,861,863 29,334,859 $4,800,000 $4,400,000 $4,000,000 $3,600,000 $3,200,000 $2,800,000 $2,400,000 $2,000,000 $1,600,000 $1,200,000 $800,000 $400,000 $- $250,000 $200,000 $150,000 $100,000 $50,000 $- $70,000 $65,000 $60,000 $55,000 $50,000 $45,000 $40,000 $35,000 $2.25 $2.00 $1.75 $1.50 $1.25 Commercial Loans Consumer Loans Residential Real Estate Lease Financings Non-interest income Net-interest income ‘17 ‘18 ‘19 ‘17 ‘18 Total Revenue (in Thousands) ‘19 ‘17 ‘19 ‘18 Net Income* (in Thousands) *EXCLUDES RESTRUCTURING CHARGES ‘11 ‘18 ‘17 Diluted Earnings Per Share* *EXCLUDES RESTRUCTURING CHARGES ‘12 ‘19 ‘11 2019 Financial Highlights $5.4b TOTAL ASSETS 9.60% TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS* 1.26% RETURN ON AVERAGE ASSETS 3.59% NET INTEREST MARGIN 13.82% RETURN ON AVERAGE TANGIBLE COMMON EQUITY* Expanding our Commitment to the Communities we Serve Strengthening our local communities is at the heart of Univest’s culture. We give back to the communities we serve by providing financial support, encouraging employee volunteerism and serving in leadership roles for nonprofits. Over the course of the year, we continued with longtime partnerships while also building new relationships with nonprofit organizations to help support Univest’s growth in expansion markets. • Univest’s Connecting with Community volunteer initiative is one of the pillars of our philanthropy program. In 2019, we provided our employees with 30 half-day service projects to choose from in support of local charitable organizations. In addition to these Connecting with Community opportunities, we encouraged our employees to volunteer independently and they truly brought our community core value to life by volunteering 20,300 hours over the course of the year. • Univest is committed to providing financial education and improving financial literacy in the region. Throughout the year, our employees shared their expertise to educate more than 3,200 students on topics such as saving, budgeting and using credit wisely. • In 2019, we supported the Ronald McDonald House Charities (RMHC®) Room in Our Hearts capital campaign with a $25,000 commitment over the next five years. Additionally, we partnered with RMHC of the Philadelphia Region once again for its Show Your Stripes campaign. Through fundraising sales at Univest’s corporate offices and financial centers, our customers and employees raised more than $6,500. • As part of a four-year commitment, we are contributing $100,000 to Penn Foundation’s Hope Within Reach capital campaign. The donation will help Penn Foundation expand their campus and the behavioral health services they provide our community. • As we continued to expand our presence into Central Pennsylvania, we supported two capital campaigns that will have an impact on communities in Lancaster County. A three-year, $30,000 commitment to the West Lampeter Township Community Foundation’s We’re Taking the Field campaign will improve Village Park and a $10,000 donation over two years will help the Southern End Community Association improve and renovate the outdoor swimming pool in Quarryville. • While the markets we serve continue to expand, we have not lost sight of where it all started. We are proud to be longtime supporters of many nonprofits that operate in the Indian Valley where we were founded including Generations, Montgomery Theater and Dock Mennonite Academy. • During the month of December, we held our eighth annual Caring for Community Giveaway. We had an overwhelming response from the community with more than 8,100 entries on behalf of more than 200 local nonprofit groups. The Kisses for Kyle Foundation was selected as the winner of the $5,000 donation. Philanthropic Year in Review 8% 1% 18% 19% 54% Youth & Education Health & Social Services Community & Economic Development Arts & Culture Other *Tangible common equity represents total shareholders’ equity less goodwill and other intangible assets, but includes servicing rights. $2.0m FINANCIAL CONTRIBUTIONS 486 ORGANIZATIONS SUPPORTED 30 CONNECTING WITH COMMUNITY DAYS 20,300 VOLUNTEER HOURS 3,279 STUDENTS EDUCATED Senior Leadership Team Listing as of January 1, 2020 Jeffrey M. Schweitzer President and Chief Executive Officer, Univest Financial Corporation and Chief Executive Officer, Univest Bank and Trust Co. Michael S. Keim President, Univest Bank and Trust Co. and Senior Executive Vice President, Univest Financial Corporation Duane J. Brobst Senior Executive Vice President and Chief Credit Officer, Univest Bank and Trust Co. Michael S. Fitzgerald Market President, East Penn & NJ, Univest Bank and Trust Co. Ronald R. Flaherty President, Univest Insurance, LLC Brian Grzebin President, Mortgage Banking, Univest Bank and Trust Co. Thomas J. Jordan, IV Market President, Central PA, Univest Bank and Trust Co. Board of Directors Listing as of January 1, 2020 William S. Aichele Chairman, Univest Financial Corporation and Univest Bank and Trust Co.; Retired President and Chief Executive Officer, Univest Financial Corporation Roger H. Ballou Former Director, President and Chief Executive Officer, CDI Corporation; Director, Alliance Data Systems and RCM Technologies, Inc. Todd S. Benning Principal, DunlapSLK, PC Glenn E. Moyer Chief Executive Officer, Live Oak Strategies, LLC; Director, FHL Bank Pittsburgh K. Leon Moyer Retired President and Chief Executive Officer, Univest Bank and Trust Co. Natalye Paquin, Esq. President and Chief Executive Officer, Points of Light Foundation Thomas M. Petro Managing Partner, 1867 Capital Partners, LLC; Former President and Chief Executive Officer, Fox Chase Bancorp Kevin B. Norris President, Girard, a Univest Wealth Division Megan D. Santana, Esq. Senior Executive Vice President, Chief Risk Officer, General Counsel and Corporate Secretary, Univest Financial Corporation and Univest Bank and Trust Co. Dana E. Brown Executive Vice President, Consumer Services, Univest Bank and Trust Co. Eric W. Conner Executive Vice President and Chief Information Officer, Univest Financial Corporation Brian J. Richardson Executive Vice President and Chief Financial Officer, Univest Financial Corporation and Univest Bank and Trust Co. M. Theresa Schwartzer Executive Vice President and Director of Human Resources, Univest Financial Corporation Annette D. Szygiel Executive Vice President and Chief Experience Officer, Univest Financial Corporation Jeffrey M. Schweitzer President and Chief Executive Officer, Univest Financial Corporation and Chief Executive Officer, Univest Bank and Trust Co. Michael L. Turner, Esq. Partner, Marshall Dennehey Warner Coleman & Goggin Robert C. Wonderling President and Chief Executive Officer, Greater Philadelphia Chamber of Commerce Charles H. Zimmerman Senior Leadership, Calvary Church of Souderton; Director, Clemens Family Corporation Suzanne Keenan (Alternate Director) Member of the Board of Trustees of North American Electric Reliability Corporation; Member of SAP Independent Executive Advisory Council; Member of Rocket Wagon’s Advisory Council; Member of Boston Digital’s Advisory Council Wholly-Owned Subsidiaries Univest Bank and Trust Co. Girard Investment Services, LLC Univest Capital, Inc. Girard Pension Services, LLC Univest Insurance, LLC Davisville Associates, LLC Girard Advisory Services, LLC 104 S. Oakland Ave., LLC Girard Benefits Group, LLC Please visit univest.net for a complete list of locations for Univest Financial Corporation and our subsidiaries. Poised for Growth Shareholder Information Our Franchise Investing in the business was a continued focus in 2019 – in people, technology and in the products and services we provide. As we look forward, we will continue to evolve our efforts to expand our reach, increase productivity, optimize operations and gain efficiencies. With strong momentum, solid pipelines and a dedication to the customer experience, we remain confident in our ability to remain relevant and differentiate Univest in this competitive financial industry. Univest is well positioned to grow and dedicated to building the business with an innovative approach that allows us to maintain our independence as well as our unwavering commitment to serving the communities in which we operate. Thank you for your ongoing trust and investment. We look forward to continuing to support our customers, our communities and each other while providing a fair return to our loyal shareholders. The Univest Way Fundamental #1 Always Do the Right Thing Fundamental #2 Have a Growth Mindset Fundamental #3 Practice Servant Leadership Fundamental #4 Invest in Relationships Fundamental #5 Deliver Exceptional Service Fundamental #6 Comply With Regulations Fundamental #7 Don’t Be an Energy Vampire Fundamental #8 Be Nice Fundamental #9 Honor Commitments Fundamental #10 Collaborate Fundamental #11 Attack the Problem, Not the Person Fundamental #12 Give Back Fundamental #13 Provide Solutions Fundamental #14 Assume Positive Intent Fundamental #15 Listen Generously Fundamental #16 Speak Straight Fundamental #17 Celebrate Success Fundamental #18 Have Fun Shareholders’ Meeting The Annual Shareholders’ Meeting will take place at 9:00 a.m. on Wednesday, April 22, 2020 at PineCrest Country Club, 101 Country Club Drive, Lansdale, PA 19446. A buffet breakfast will begin at 8:00 a.m. Univest Stock Transfer Agent For more information on Univest Financial Corporation common stock, please contact Broadridge Corporate Issuer Solutions or visit the investor relations section at www.univest.net. Regular Mail Communications: Overnight Mail Communications: Broadridge Corporate Issuer Solutions, Inc. Broadridge Corporate Issuer Solutions, Inc. PO Box 1342 Brentwood, NY 11717 Phone Number: 866-321-8021 Email Address: shareholder@broadridge.com Website: https://investor.broadridge.com ATTN: IWS 1155 Long Island Avenue Edgewood, NY 11717 Univest Shareholder Contact For more information on Univest Financial Corporation, please call 877.723.5571. Common Stock Information Traded on the NASDAQ National Market, symbol: UVSP. “He gives strength to the weary and increases the power of the weak… but those who hope in the Lord will renew their strength. They will soar on wings like eagles; they will run and not grow weary, they will walk and not be faint.” - Isaiah 40:29, 31 2019 ANNUAL REPORT UNIVEST FINANCIAL CORPORATION 143 YEARS OF BUSINESS SUCCESS 873 EMPLOYEES MAKING IT HAPPEN 39 FINANCIAL CENTERS 11 COMMERCIAL & CORPORATE OFFICES 6 INVESTMENT OFFICES 4 INSURANCE OFFICES 2019 Integrated Successes $3.8b ASSETS UNDER MANAGEMENT AND SUPERVISION $1.1b LOANS SERVICED FOR OTHERS $178m TOTAL INSURANCE WRITTEN PREMIUM $149m EQUIPMENT FINANCE OUTSTANDINGS CORE BANKING OPERATION 75% REVENUE FROM 25% REVENUE FROM NON-BANKING OPERATIONS 

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