Univest Financial Corporation

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Commercial loan commitments through September 30th were $808 million compared to $659 million in the prior year. However, this has resulted in contraction in loan outstandings year-to-date of $41.1 million compared to growth of $163.5 million in the prior year. Deposits increased significantly during the quarter by $635.5 million compared predominantly due to the seasonal build of public funds deposit $473.2 million. Excluding the build in public funds deposits, deposits increased $162 million during the quarter. During the second quarter of this year, we recorded a $7.3 million charge-off related to a commercial loan relationship that had been placed on non-accrual and had a $16.4 million carrying balance as of June 3, 2025. As of September 30, 2005, the carrying balance of loans and other real estate owned related to this relationship totaled $13.9 million and $1.4 million respectively. The $13.9 million of loans is secured by commercial real estate, which is under the control of a court receiver. The receiver has entered into an agreement with the property, which is subject to court approval. If the sale is approved by the court and Consummated in accordance with the executed agreement, we expect the proceeds will adequately cover our carrying balance resulting in further charge-offs. With regards to the $1.4 million asset, the carrying balance is supported by appraisal and eviction proceedings are underway. Before I pass it over to Brian, I would like to thank the entire Univest family for the great work they do today and for their continued efforts serving our customers, communities, and each other. I'll now turn it over to Brian for further discussion on our results.

Thank you, Jeff, and I would also like to thank everyone for joining us today. I would like to start by highlighting a few items from the earnings release. First, reported NIM for the quarter was 3.17%, down slightly from 3.20% last quarter due to increased excess liquidity during the quarter from our seasonal public funds bill. However, core NIM of 3.33%, which X excludes the impact of excess liquidity, expanded by nine basis points compared to the second quarter. We expect core NIM to be relatively flat in the fourth quarter. Second, during the quarter, we recorded provision for credit losses of $517,000. The average ratio was 1.28% at September 30th, consistent with June 30th. Net charge-offs for the $480,000 were three basis points annualized. Third, non-interest income increased $1.8 million, 8.8% compared to the third quarter of 2024. Includes $987,000 increase in BOLI death benefits. Fourth, non-interest expense increased $2.1 million, or 4.4% compared to the third quarter of 2024. The increase was primarily driven by compensation costs, specifically annual merit increases and variable incentives. Additionally, increases in bank shares tax and loan workout fees. As mentioned, through the first nine months of the year, expenses were up 2%. We remain focused on prudent expense management. I believe the remainder of the earnings release was straightforward, and I would now like to provide an update to our 2020 guidance. First, for the full year, we expect loans to be relatively flat when compared to December 31, 2024. We expect net interest income growth to be 12% to 14% compared to 2024. Second, we expect our provision for credit losses to be $11 to $13 million for 2025. However, the provision will continue to be event-driven, including loans, changes in economic-related assumptions, and the credit performance of the portfolio, including specific credits. Third, 2024 non-interest income totaled $84.5 million when excluding the $3.4 million gain on MSRs and $245,000 of bully death benefits. For 2025, we expect non-interest income growth of approximately 1% to 3% off the $84.5 million base. There is a risk to this guidance if the government shutdown continues or unable to originate and sell SBA loans during the fourth quarter. Fourth, We reported non-interest expense of $100 million for 2024. For 2025, we expect growth of approximately 2 to 3 percent. As it relates to income taxes, our guidance remains unchanged at 20 to 20.5 percent based on the current statutory rates. This concludes my prepared remarks. We will be happy to answer any questions. Would you please begin the question and answer session?