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Univest Corporation of Pennsylvania -- Univest National Bank and Trust Co. -- Reports Fourth Quarter and Year End Earnings

SOUDERTON, PA--(Marketwire - 01/26/11) - Univest Corporation of Pennsylvania (NASDAQ:UVSP - News), a full service financial institution with 135 years of experience in delivering financial solutions including personal and business banking, online banking, residential mortgages, insurance products, investments and wealth advisory solutions, today announced financial results for the fourth quarter and year ended December 31, 2010. Univest reported net income of $4.9 million or $0.30 diluted earnings per share for the quarter ended December 31, 2010, compared to net income of $1.5 million or $0.09 diluted earnings per share for the quarter ended December 31, 2009.For the year ended December 31, 2010, Univest reported net income of $15.8 million or $0.95 diluted earnings per share compared to net income of $10.8 million or $0.75 diluted earnings per share reported for the year ended December 31, 2009.DepositsTotal non-time deposits increased $26.5 million during the quarter and have increased $154.8 million year over year. These increases were offset by a decline in time deposits of $17.8 million for the three months ended December 31, 2010 and $32.8 million for the twelve months ended December 31, 2010.LoansGross loans and leases increased $3.8 million during the quarter and $45.2 million for the twelve months ended December 31, 2010. While overall loan demand remains light primarily due to less credit demand and utilization of lines by businesses responding to the current economic environment, Univest continues to secure new loan opportunities due to the previously mentioned disruption in local markets and increased visibility as a result of a brand campaign designed to fuel loan growth.Net Interest Income and MarginNet interest income increased $2.4 million or 14.5% to $19.2 million in the fourth quarter of 2010 and increased year over year by $5.9 million or 8.7% to $73.5 million. The net interest margin on a tax-equivalent basis for the fourth quarter of 2010 increased 49 basis points to 4.18% compared to 3.69% for the fourth quarter of 2009. For the year ended December 31, 2010, net interest margin on a tax-equivalent basis increased 32 basis points to 4.11% compared to 3.79% for the prior year.The increases in net interest income and net interest margin for the quarter and year can be attributed to declines in the cost of interest-bearing liabilities, primarily time deposits and Federal Home Loan Bank (FHLB) borrowings, exceeding the declines in yields on total interest-earnings assets. The Corporation has continued to experience core deposit growth which has allowed the Corporation to continue to repay its maturing FHLB advances which were $92 million at December 31, 2009 and $5 million at December 31, 2010.Non-Interest IncomeTotal non-interest income increased by $449 thousand or 5.09% to $9.3 million for the quarter compared to $8.8 million for the quarter ended December 31, 2009. This increase was primarily due to increased trust fee income of $169 thousand; investment advisory commission and fee income of $166 thousand; insurance commission and fee income of $226 thousand; and other income of $1.1 million, primarily due to increases in interchange fee income and favorable valuation adjustments on mortgage servicing rights. During the quarter, the Corporation reversed $412 thousand of negative valuation adjustments on mortgage servicing rights recorded during the third quarter as interest rates increased during the quarter which in turn slowed down pre-payment speeds on mortgages serviced by the Corporation. Additionally, the fourth quarter of 2009 was impacted by $761 thousand of other-than-temporary impairment charges on certain bank equity securities and other long-lived assets compared to $3 thousand in the fourth quarter of 2010. These favorable variances were partially offset by a reduction in the net gain on sales of securities of $1.0 million and a $447 thousand net gain on the interest rate swap recorded during the fourth quarter of 2009.Non-interest income was negatively impacted during the fourth quarter as a result of the challenging economic climate and increased regulatory requirements. The negative effects from the implementation of Regulation E on August 15, 2010, which requires customers to opt-in for overdraft protection on debit card and point of sale transactions, were realized for the first time for an entire quarter, significantly contributing to the decline of $520 thousand on Univest's service charges on deposit accounts compared to the fourth quarter of the prior year.Total non-interest income for the year ended December 31, 2010 increased $4.5 million or 15.04% to $34.4 million compared to $29.9 million for the year ended December 31, 2009. This increase was due to increased trust fee income of $544 thousand; investment advisory commission and fee income of $1.2 million; insurance commissions and fee income of $613 thousand; net gain on mortgage banking activities of $582 thousand and other income of $2.2 million, primarily related to interchange fee income; a litigation settlement during the first quarter of 2010; mortgage servicing fee income; and gains on the sales of terminated leases. Additionally, the increase resulted from a decline by $2.1 million in other-than-temporary impairment charges.These increases were offset by a decline in service charges on deposit accounts in part due to Regulation E of $343 thousand, a reduction in the net gain on sales of securities of $718 thousand and a loss of $1.1 million related to a fair value write-down on an interest rate swap for a commercial real estate loan due to the decline in interest rates during the year. The swap was terminated during August 2010 due to the forecasted low interest rate environment.Non-Interest ExpenseNon-interest expense for the fourth quarter of 2010 decreased $1.3 million or 7.32% to $16.2 million, primarily due to a decline of $776 thousand in salaries and benefits as a result of reduced pension plan expenses and a change in the valuation of the Corporation's non-qualified pension plans of $433 thousand. This was partially offset by additional staffing to support additional personnel to grow the commercial lending and mortgage banking businesses.Non-interest expense increased $2.0 million, or 3.10% for the year ended December 31, 2010. Salaries and benefits increased $612 thousand as a result of additional personnel to grow the commercial lending and mortgage banking businesses and higher restricted stock expense partially offset by reduced pension plan expenses. Equipment expense increased $373 thousand and marketing and advertising expenses increased $478 thousand during the year primarily to support a major brand campaign to position the Corporation to take advantage of the disruption in the local markets. Other expenses increased primarily due to increased legal fees resulting from non-performing loan activity and increased audit and interchange expenses.Asset Quality and Provision for Loan and Lease LossesNon-accrual loans and leases were $45.2 million at December 31, 2010 compared to $33.0 million at September 30, 2010 and $33.5 million at December 31, 2009. Nonperforming loans and leases as a percentage of total loans and leases equaled 3.16% at December 31, 2010 compared to 2.37% at September 30, 2010 and 2.65% at December 31, 2009. The increase in non-accrual loans was primarily due to the migration of four relationships to non-accrual status. These relationships were not concentrated in any one industry and consisted of hotel/office space; investment commercial real estate; a construction company; and a manufacturing company.Net loan and lease charge-offs for the quarter were $4.3 million compared to $5.8 million for the previous three months. For the year ended December 31, 2010, net loan and lease charge-offs were $15.5 million or 1.07% of average loans and leases compared to $9.2 million or 0.63% for the year ended December 31, 2009.The provision for loan and lease losses was $6.3 million for the fourth quarter of 2010 compared to $5.5 million for the third quarter of 2010 and $7.4 million for the corresponding quarter in the prior year. For the year ended December 31, 2010, the provision for loan and lease losses was $21.6 million compared to $20.9 million for the prior year. The increase in the provision is due to the migration of loans to higher-risk ratings as a result of deterioration of underlying collateral and economic factors.As a result of the increased provision, the allowance for loan and lease losses as a percentage of total loans and leases increased to 2.10% at December 31, 2010 from 1.97% at September 30, 2010 and 1.74% at December 31, 2009. The allowance for loan and lease losses to nonperforming loans and leases equaled 66.48% at December 31, 2010 which decreased from 83.10% at September 30, 2010. The allowance for loan and lease losses to nonperforming loans and leases was 65.54% at December 31, 2009.CapitalUnivest continues to remain well-capitalized at December 31, 2010. Univest's total risk-based capital at December 31, 2010 was 15.47%, well in excess of the regulatory minimum for well capitalized status of 10% for total risk-based capital.DividendOn January 3, 2011, Univest Corporation paid a quarterly cash dividend of $0.20 per share, which represented a 4.05% annualized yield based on the closing price of Univest's stock on the date the dividend was paid.About Univest CorporationHeadquartered in Souderton, Pa., Univest Corporation of Pennsylvania (www.univest.net) and its subsidiaries serve the financial needs of residents, businesses, and nonprofit organizations in Bucks, Chester, Montgomery and Lehigh counties. For more information on Univest Corporation of Pennsylvania and its subsidiaries, please visit www.univest.net.This press release of Univest Corporation and the reports Univest Corporation files with the Securities and Exchange Commission often contain "forward-looking statements" relating to present or future trends or factors affecting the banking industry and, specifically, the financial operations, markets and products of Univest Corporation. These forward-looking statements involve certain risks and uncertainties. There are a number of important factors that could cause Univest Corporation's future results to differ materially from historical performance or projected performance. These factors include, but are not limited to: (1) a significant increase in competitive pressures among financial institutions; (2) changes in the interest rate environment that may reduce net interest margins; (3) changes in prepayment speeds, loan sale volumes, charge-offs and loan loss provisions; (4) general economic conditions; (5) legislative or regulatory changes that may adversely affect the businesses in which Univest Corporation is engaged; (6) technological issues which may adversely affect Univest Corporation's financial operations or customers; (7) changes in the securities markets or (8) risk factors mentioned in the reports and registration statements Univest Corporation files with the Securities and Exchange Commission. Univest Corporation undertakes no obligation to revise these forward-looking statements or to reflect events or circumstances after the date of this press release.

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

(Dollars in
thousands)

Balance Sheet
(Period End) 12/31/10 09/30/10 06/30/10 03/31/10 12/31/09
----------- ----------- ----------- ----------- -----------
Assets $ 2,133,893 $ 2,114,204 $ 2,088,572 $ 2,064,822 $ 2,085,421
Securities 467,024 420,998 434,677 436,368 420,045
Loans held for
sale 4,178 3,801 2,485 1,165 1,693
Loans and
leases, gross 1,471,186 1,467,382 1,449,147 1,427,805 1,425,980
Allowance for
loan and lease
losses 30,898 28,883 29,109 27,065 24,798
Loans and
leases, net 1,440,288 1,438,499 1,420,038 1,400,740 1,401,182
Total deposits 1,686,270 1,677,641 1,609,772 1,572,681 1,564,257
Non-interest
bearing
deposits 271,125 272,805 255,880 246,909 242,691
NOW, Money
Market and
Savings 997,395 969,254 924,242 894,799 871,024
Time deposits 417,750 435,582 429,650 430,973 450,542
Borrowings 143,865 128,905 171,824 187,637 214,063
Shareholders'
equity 266,224 270,773 269,524 267,850 267,807


Balance Sheet
(Average) For the three months ended,
-----------------------------------------------------------
12/31/10 09/30/10 06/30/10 03/31/10 12/31/09
----------- ----------- ----------- ----------- -----------
Assets $ 2,125,112 $ 2,117,708 $ 2,090,930 $ 2,038,739 $ 2,096,945
Securities 449,031 431,193 442,902 409,188 454,097
Loans and
leases, gross 1,461,766 1,459,820 1,425,278 1,420,830 1,438,880
Deposits 1,689,701 1,642,613 1,606,621 1,537,676 1,553,308
Shareholders'
equity 271,945 271,045 269,902 269,030 267,644



Balance Sheet For the twelve months
(Average) ended,
-----------------------
12/31/10 12/31/09
----------- -----------
Assets $ 2,093,422 $ 2,083,447
Securities 433,182 433,980
Loans and
leases, gross 1,442,085 1,453,174
Deposits 1,619,634 1,554,230
Shareholders'
equity 270,490 230,395



Asset Quality Data
(Period End)
12/31/10 09/30/10 06/30/10 03/31/10 12/31/09
-------- -------- -------- -------- --------
Nonaccrual loans and
leases $ 45,232 $ 33,043 $ 29,541 $ 34,856 $ 33,498
Accruing loans and leases
90 days or more past due 696 899 1,276 303 726
Troubled debt restructured 550 813 1,499 1,691 3,611
Other real estate owned 2,438 1,557 1,827 2,453 3,428
Nonperforming assets 48,916 36,312 34,143 39,303 41,263
Allowance for loan and
lease losses 30,898 28,883 29,109 27,065 24,798
Nonperforming loans and
leases / Loans and
leases 3.16% 2.37% 2.23% 2.58% 2.65%
Allowance for loan and
lease losses / Loans and
leases 2.10% 1.97% 2.01% 1.90% 1.74%
Allowance for loan and
lease losses /
Nonperforming loans 66.48% 83.10% 90.08% 73.45% 65.54%



For the twelve
For the three months ended, months ended,
-------------------------------------------- -----------------
12/31/10 09/30/10 06/30/10 03/31/10 12/31/09 12/31/10 12/31/09
-------- -------- -------- -------- -------- -------- --------
Net loan
and lease
charge-
offs $ 4,261 $ 5,755 $ 2,821 $ 2,628 $ 4,595 $ 15,465 $ 9,206
Net loan
and lease
charge-offs
(annualized)/
Average loans
and leases 1.16% 1.56% 0.79% 0.75% 1.27% 1.07% 0.63%



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

(Dollars in
thousands,
except per
share data)
For the three months ended,
----------------------------------------------------------
For the period: 12/31/10 09/30/10 06/30/10 03/31/10 12/31/09
---------- ---------- ---------- ---------- ----------
Interest income $ 22,580 $ 23,060 $ 22,878 $ 22,485 $ 23,184
Interest
expense 3,380 4,107 4,602 5,380 6,409
---------- ---------- ---------- ---------- ----------
Net interest
income 19,200 18,953 18,276 17,105 16,775
Provision for
loan and lease
losses 6,276 5,529 4,865 4,895 7,449
---------- ---------- ---------- ---------- ----------
Net interest
income after
provision 12,924 13,424 13,411 12,210 9,326
Noninterest
income:
Trust fee
income 1,630 1,450 1,500 1,500 1,461
Service charges
on deposit
accounts 1,466 1,633 1,812 1,782 1,986
Investment
advisory
commission
and fee income 1,191 1,227 1,152 1,056 1,025
Insurance
commissions and
fee income 1,740 1,815 1,896 2,243 1,514
Bank owned life
insurance income 410 326 202 332 351
Other-than-
temporary
impairment (3) (12) (42) (5) (761)
Net gain (loss) on
sales of
securities 6 339 38 49 1,023
Net gain on
mortgage banking
activities 779 1,246 475 460 847
Net (loss) gain
on interest
rate swap - (246) (516) (310) 447
Other income 2,049 1,106 1,542 1,100 926
---------- ---------- ---------- ---------- ----------
Total
noninterest
income 9,268 8,884 8,059 8,207 8,819
Noninterest
expense
Salaries and
benefits 8,979 9,775 9,469 9,811 9,755
Premises and
equipment 2,351 2,435 2,209 2,292 2,138
Deposit
insurance
premiums 712 698 663 597 599
Other expense 4,148 4,263 4,568 4,379 4,976
---------- ---------- ---------- ---------- ----------
Total
noninterest
expense 16,190 17,171 16,909 17,079 17,468
---------- ---------- ---------- ---------- ----------
Income before
taxes 6,002 5,137 4,561 3,338 677
Applicable
income taxes 1,093 990 831 368 (845)
---------- ---------- ---------- ---------- ----------
Net income $ 4,909 $ 4,147 $ 3,730 $ 2,970 $ 1,522
========== ========== ========== ========== ==========

Per Common
Share Data:
Book value per
share $ 15.99 $ 16.29 $ 16.25 $ 16.17 $ 16.27
Net income per
share:
Basic $ 0.30 $ 0.25 $ 0.23 $ 0.18 $ 0.09
Diluted $ 0.30 $ 0.25 $ 0.23 $ 0.18 $ 0.09
Dividends per
share $ 0.20 $ 0.20 $ 0.20 $ 0.20 $ 0.20
Weighted
average shares
outstanding 16,645,115 16,621,291 16,589,657 16,535,461 16,464,824
Period end
shares
outstanding 16,648,303 16,626,900 16,590,710 16,561,807 16,465,083



(Dollars in
thousands,
except per
share data)
For the twelve months
ended,
----------------------
For the period: 12/31/10 12/31/09
---------- ----------
Interest income $ 91,003 $ 96,359
Interest
expense 17,469 28,723
---------- ----------
Net interest
income 73,534 67,636
Provision for
loan and lease
losses 21,565 20,886
---------- ----------
Net interest
income after
provision 51,969 46,750
Noninterest
income:
Trust fee income 6,080 5,536
Service charges
on deposit
accounts 6,693 7,036
Investment
advisory
commission and
fee income 4,626 3,427
Insurance
commissions and
fee income 7,694 7,081
Bank owned
life insurance
income 1,270 1,321
Other-than-
temporary
impairment (62) (2,208)
Net gain (loss) on
sales of
securities 432 1,150
Net gain on
Mortgage banking
activities 2,960 2,378
Net (loss) gain
on interest
rate swap (1,072) 641
Other income 5,797 3,555
---------- ----------
Total
noninterest
income 34,418 29,917
Noninterest
expense
Salaries and
benefits 38,034 37,422
Premises and
equipment 9,287 8,712
Deposit
insurance
premiums 2,670 3,185
Other expense 17,358 16,005
---------- ----------
Total
noninterest
expense 67,349 65,324
---------- ----------
Income before
taxes 19,038 11,343
Applicable
income taxes 3,282 563
---------- ----------
Net income $ 15,756 $ 10,780
========== ==========

Per Common
Share Data:
Book value per
share $ 15.99 $ 16.27
Net income per
share:
Basic $ 0.95 $ 0.75
Diluted $ 0.95 $ 0.75
Dividends per
share $ 0.80 $ 0.80
Weighted
average shares
outstanding 16,598,284 14,347,104
Period end
shares
outstanding 16,648,303 16,465,083



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




For the three months ended,
-----------------------------------------------------
Profitability Ratios
(annualized) 12/31/10 09/30/10 06/30/10 03/31/10 12/31/09
--------- --------- --------- --------- ---------

Return on average
assets 0.92% 0.78% 0.72% 0.59% 0.29%
Return on average
shareholders'
equity 7.16% 6.07% 5.54% 4.48% 2.26%
Net interest margin
(FTE) 4.18% 4.15% 4.11% 3.99% 3.69%
Efficiency ratio (1) 54.20% 58.88% 61.32% 64.33% 65.35%

Capitalization Ratios

Dividends paid to
net income 67.85% 80.15% 88.95% 111.55% 216.43%
Shareholders' equity
to assets (Period
End) 12.48% 12.81% 12.90% 12.97% 12.84%
Tangible common
equity to tangible
assets 10.08% 10.46% 10.51% 10.55% 10.44%


Regulatory Capital
Ratios (Period
End)
Tier 1 leverage
ratio 11.54% 11.51% 11.57% 11.82% 11.46%
Tier 1 risk-based
capital ratio 14.17% 14.14% 14.25% 14.44% 14.41%
Total risk-based
capital ratio 15.47% 15.45% 15.58% 15.78% 15.76%



For the twelve
months ended,
--------------------
Profitability Ratios
(annualized) 12/31/10 12/31/09
--------- ---------

Return on average
assets 0.75% 0.52%
Return on average
shareholders'
equity 5.82% 4.68%
Net interest margin
(FTE) 4.11% 3.79%
Efficiency ratio (1) 59.52% 63.88%

Capitalization
Ratios

Dividends paid to
net income 84.31% 109.33%
Shareholders' equity
to assets (Period
End) 12.48% 12.84%
Tangible common
equity to tangible
assets 10.08% 10.44%


Regulatory Capital
Ratios (Period
End)
Tier 1 leverage
ratio 11.54% 11.46%
Tier 1 risk-based
capital ratio 14.17% 14.41%
Total risk-based
capital ratio 15.47% 15.76%


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




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


For the Three Months Ended December 31,
-------------------------- ---------------------------
Tax Equivalent
Basis 2010 2009
-------------------------- ---------------------------
Average Income/ Average Average Income/ Average
Balance Expense Rate Balance Expense Rate
---------- ------- ------ ---------- ------- ------
Assets:
Interest-earning
deposits with
other banks $ 24,975 $ 22 0.35% $ 11,706 $ 8 0.27%
U.S. Government
obligations 176,910 829 1.86 126,261 864 2.71
Obligations of
state and
political
subdivisions 109,902 1,718 6.20 107,722 1,684 6.20
Other debt and
equity securities 162,219 1,576 3.85 220,114 2,400 4.33
---------- ------- ---------- -------
Total interest-
earning deposits
and investments 474,006 4,145 3.47 465,803 4,956 4.22
---------- ------- ---------- -------

Commercial,
financial, and
agricultural
loans 427,828 5,330 4.94 414,338 4,817 4.61
Real estate--
commercial and
construction
loans 552,262 7,648 5.49 527,559 7,260 5.46
Real estate--
residential loans 252,836 2,681 4.21 273,366 3,087 4.48
Loans to
individuals 43,261 644 5.91 47,470 820 6.85
Municipal loans
and leases 117,028 1,758 5.96 93,669 1,362 5.77
Lease financings 68,551 1,555 9.00 82,478 1,828 8.79
---------- ------- ---------- -------
Gross loans and
leases 1,461,766 19,616 5.32 1,438,880 19,174 5.29
---------- ------- ---------- -------
Total interest-
earning assets 1,935,772 23,761 4.87 1,904,683 24,130 5.03
---------- ------- ---------- -------
Cash and due from
banks 34,326 39,521
Reserve for loan
and lease losses (29,413) (23,663)
Premises and
equipment, net 34,932 33,643
Other assets 149,495 142,761
---------- ----------
Total assets $2,125,112 $2,096,945
========== ==========

Liabilities:
Interest-bearing
checking deposits $ 181,357 $ 62 0.14 $ 166,778 $ 58 0.14
Money market
savings 336,161 228 0.27 282,040 337 0.47
Regular savings 466,162 535 0.46 382,980 744 0.77
Time deposits 428,720 2,061 1.91 486,326 3,768 3.07
---------- ------- ---------- -------
Total time and
interest-bearing
deposits 1,412,400 2,886 0.81 1,318,124 4,907 1.48
---------- ------- ---------- -------

Securities sold
under agreements
to repurchase 96,143 72 0.30 101,140 129 0.51
Other short-term
borrowings 5,698 62 4.32 98,803 1,068 4.29
Long-term debt 5,000 48 3.81 10,640 (14) (0.52)
Subordinated notes
and capital
securities 24,365 312 5.08 25,865 320 4.91
---------- ------- ---------- -------
Total borrowings 131,206 494 1.49 236,448 1,503 2.52
---------- ------- ---------- -------
Total interest-
bearing
liabilities 1,543,606 3,380 0.87 1,554,572 6,410 1.64
---------- ------- ---------- -------
Demand deposits,
non-interest
bearing 277,301 235,184
Accrued expenses
and other
liabilities 32,260 39,545
---------- ----------
Total
liabilities 1,853,167 1,829,301
---------- ----------

Shareholders'
Equity
Common stock 91,332 91,332
Additional paid-in
capital 61,420 61,426
Retained earnings
and other equity 119,193 114,886
---------- ----------
Total shareholders'
equity 271,945 267,644
---------- ----------
Total liabilities
and shareholders'
equity $2,125,112 $2,096,945
========== ==========
Net interest
income $20,381 $17,720
======= =======

Net interest
spread 4.00 3.39
Effect of net
interest-free
funding sources 0.18 0.30
------ ------
Net interest
margin 4.18% 3.69%
====== ======
Ratio of average
interest-earning
assets to average
interest-bearing
liabilities 125.41% 122.52%
========== ==========

Notes: For rate calculation purposes, average loan and lease categories
include unearned discount.
Nonaccrual loans and leases have been included in the average loan
and lease balances.
Loans held for sale have been included in the average loan
balances.
Tax-equivalent amounts for the three months ended December 31,
2010 and 2009 have been calculated using the Corporation's
federal applicable rate of 35.0% and 34.5%, respectively.





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


For the Twelve Months Ended December 31,
Tax Equivalent -------------------------- --------------------------
Basis 2010 2009
-------------------------- --------------------------
Average Income/ Average Average Income/ Average
Balance Expense Rate Balance Expense Rate
---------- ------- ------ ---------- ------- ------
Assets:
Interest-earning
deposits with
other banks $ 24,790 $ 72 0.29% $ 5,645 $ 16 0.28%
U.S. Government
obligations 151,725 3,160 2.08 110,781 3,608 3.26
Obligations of
state and
political
subdivisions 108,694 7,006 6.45 104,481 6,890 6.59
Other debt and
equity securities 172,763 7,217 4.18 218,660 10,406 4.76
Federal funds sold - - - 58 - -
---------- ------- ---------- -------
Total interest-
earning deposits,
investments and
federal funds
sold 457,972 17,455 3.81 439,625 20,920 4.76
---------- ------- ---------- -------

Commercial,
financial, and
agricultural loans 422,401 20,315 4.81 410,729 18,838 4.59
Real estate--commercial
and construction
loans 534,573 30,834 5.77 521,029 30,549 5.86
Real estate--
residential loans 256,427 11,124 4.34 291,229 13,520 4.64
Loans to
individuals 45,287 2,698 5.96 49,930 3,440 6.89
Municipal loans and
leases 107,524 6,409 5.96 90,065 5,444 6.04
Lease financings 75,873 6,690 8.82 90,192 7,655 8.49
---------- ------- ---------- -------
Gross loans and
leases 1,442,085 78,070 5.41 1,453,174 79,446 5.47
---------- ------- ---------- -------
Total interest-
earning assets 1,900,057 95,525 5.03 1,892,799 100,366 5.30
---------- ------- ---------- -------
Cash and due from
banks 35,612 33,514
Reserve for loan
and lease losses (28,688) (18,200)
Premises and
equipment, net 34,914 33,170
Other assets 151,527 142,164
---------- ----------
Total assets $2,093,422 $2,083,447
========== ==========

Liabilities:
Interest-bearing
checking deposits $ 178,679 $ 242 0.14 $ 162,615 $ 257 0.16
Money market
savings 303,012 1,060 0.35 305,113 1,724 0.57
Regular savings 445,721 2,555 0.57 353,748 2,955 0.84
Time deposits 432,919 10,054 2.32 508,337 17,371 3.42
---------- ------- ---------- -------
Total time and
interest-bearing
deposits 1,360,331 13,911 1.02 1,329,813 22,307 1.68
---------- ------- ---------- -------

Securities sold
under agreements
to repurchase 97,667 390 0.40 91,390 544 0.60
Other short-term
borrowings 42,109 1,726 4.10 92,209 2,937 3.19
Long-term debt 5,363 190 3.54 48,979 1,640 3.35
Subordinated notes
and capital
securities 24,927 1,252 5.02 26,427 1,295 4.90
---------- ------- ---------- -------
Total
borrowings 170,066 3,558 2.09 259,005 6,416 2.48
---------- ------- ---------- -------
Total interest-
bearing
liabilities 1,530,397 17,469 1.14 1,588,818 28,723 1.81
---------- ------- ---------- -------
Demand deposits,
non-interest
bearing 259,303 224,417
Accrued expenses
and other
liabilities 33,232 39,817
---------- ----------
Total
liabilities 1,822,932 1,853,052
---------- ----------

Shareholders'
Equity
Common stock 91,332 80,969
Additional paid-in
capital 61,420 37,844
Retained earnings
and other equity 117,738 111,582
---------- ----------
Total shareholders'
equity 270,490 230,395
---------- ----------
Total
liabilities and
shareholders'
equity $2,093,422 $2,083,447
========== ==========
Net interest income $78,056 $71,643
======= =======

Net interest spread 3.89 3.49
Effect of net
interest-free
funding sources 0.22 0.30
------ ------
Net interest margin 4.11% 3.79%
====== ======
Ratio of average
interest-earning
assets to average
interest-bearing
liabilities 124.15% 119.13%
========== ==========

Notes: For rate calculation purposes, average loan and lease categories
include unearned discount.
Nonaccrual loans and leases have been included in the average loan
and lease balances.
Loans held for sale have been included in the average loan
balances.
Tax-equivalent amounts for the twelve months ended December 31,
2010 and 2009 have been calculated using the Corporation's
federal applicable rate of 35.0% and 34.5%, respectively.