Company: UVSP
Filing Date: 2025-10-24
Form Type: 10-Q
Source: 0000102212-25-000028
Chunk: 141

Company: UNIVEST FINANCIAL Corp
Filing Date: 2025-10-24
Form: 10-Q
Item: Item 8
Chunk 141
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2 inputs. These inputs are based on pricing information obtained from wholesale mortgage banks and brokers and applied to loans with similar interest rates and maturities.Derivative Financial InstrumentsThe fair values of derivative financial instruments are based upon the estimated amount the Corporation would receive or pay to terminate the contracts or agreements, taking into account current interest rates and, when appropriate, the current creditworthiness of the counterparties. Interest rate swaps and mortgage banking derivative financial instruments are classified within Level 2 of the valuation hierarchy. Credit derivatives are valued based on credit worthiness of the underlying borrower which is a significant unobservable input and therefore classified in Level 3 of the valuation hierarchy.Contingent Consideration LiabilityThe Corporation estimates the fair value of the contingent consideration liability by using a discounted cash flow model of future contingent payments based on projected revenue related to the acquired business. The estimated fair value of the contingent consideration liability is reviewed on a quarterly basis and any valuation adjustments resulting from a change of estimated future contingent payments based on projected revenue of the acquired business affecting the contingent consideration liability will be recorded through noninterest expense. Due to the significant unobservable input related to the projected revenue, the contingent consideration liability is classified within Level 3 of the valuation hierarchy. An increase in the projected revenue may result in a higher fair value of the contingent consideration liability. Alternatively, a decrease in the projected revenue may result in a lower estimated fair value of the contingent consideration liability.

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The following table presents the assets and liabilities measured at fair value on a recurring basis at September 30, 2025 and December 31, 2024, classified using the fair value hierarchy: At September 30, 2025(Dollars in thousands)Level 1Level 2Level 3Assets/Liabilities atFair ValueAssets:Available-for-sale securities:Residential mortgage-backed securities$— $293,205 $— $293,205 Collateralized mortgage obligations— 1,449 — 1,449 Corporate bonds— 73,739 — 73,739 Total available-for-sale securities— 368,393 — 368,393 Equity securities:Money market mutual funds2,413 — — 2,413 Total equity securities2,413 — — 2,413 Loans held for sale— 6,330 — 6,330 Interest rate locks with customers*— 304 — 304 Total assets$2,413 $