Univest earnings fell in the third quarter of 2026 as the bank recorded higher provisions for credit losses following elevated loan charge-offs. Net income was $21.6 million, or $0.78 per diluted share, compared with $25.6 million, or $0.89 per diluted share, a year earlier.

Credit losses weigh on Univest earnings

Univest Financial Corporation said on October 28 that the decline in quarterly profit was primarily due to the increase in its credit loss provision. The provision rose to $9.0 million from $2.7 million in the second quarter of 2026 and $517,000 in the third quarter of 2025.

Net loan and lease charge-offs reached $17.6 million, up from $1.9 million in the preceding quarter. The increase primarily reflected a $14.4 million charge-off on an existing nonaccrual commercial loan relationship that totaled $28.3 million. Univest said the relationship had a $9.8 million specific reserve, and its remaining carrying value was supported by a letter of intent to sell the business.

A separate $6.9 million commercial loan relationship incurred a $2.7 million charge-off; its remaining balance was paid in full during the quarter. Nonperforming assets fell to $51.4 million at September 30 from $63.0 million at June 30.

Interest income rises despite lower profit

Net interest income increased 10.5% from a year earlier to $67.8 million. Univest attributed the increase to higher average loan balances and a lower cost of funds. Its tax-equivalent net interest margin was 3.42%, compared with 3.49% in the second quarter of 2026 and 3.17% a year earlier.

Noninterest income rose 1.6% year over year to $22.3 million, while noninterest expense increased 6.6% to $54.0 million. The prior-year quarter included $967,000 in bank-owned life insurance death benefit claims, which Univest said in its 2025 third-quarter results added $0.03 to diluted earnings per share.

Deposits, loans and shareholder returns

Total deposits increased $421.5 million, or 6.1%, from June 30. Univest attributed the growth primarily to seasonal increases in public funds and higher commercial deposits, partly offset by declines in consumer and brokered deposits.

Gross loans and leases fell $27.5 million, or 0.4%, from June 30, driven primarily by a $35.3 million loan payoff and the $14.4 million commercial loan charge-off. They rose $229.0 million, or 3.4%, from September 30, 2025.

Univest declared a quarterly dividend of $0.23 per share, payable November 25, 2026, to shareholders of record on November 11. It repurchased 301,127 shares during the quarter at an average price of $42.50 per share, excluding fees and excise tax.

Next milestone

Univest scheduled a conference call to discuss the results for October 29, 2026, at 9:00 a.m. EDT.

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