National Penn Bancshares (NPBC) 8-K Reports Record Second Quarter Net Income

EXHIBIT 99.1

News Release

National Penn Bancshares, Inc.

Reports Record Second Quarter Net Income

Media Contact:             Catharine S. Bower, Corporate Communications

(610) 369-6618 or catharine.bower@nationalpenn.com

Investor Contact:         Michelle H. Debkowski, Investor Relations

                                        (610) 369-6461 or michelle.debkowski@nationalpenn.com

BOYERTOWN, Pa., July 16, 2008 -- National Penn Bancshares, Inc. (Nasdaq: NPBC) reported record second quarter 2008 net income totaling $27.21 million, or $0.34 per diluted share.  Net income increased

approximately 67.65% compared to $16.23 million earned in the second quarter of 2007.  Diluted earnings per share was $0.32 in the second quarter of 2007.1 The significant increase in net income is largely

attributable to the first quarter 2008 acquisitions of Christiana Bank & Trust and KNBT Bancorp.

 For the first six months of 2008, National Penn earned $48.81 million of net income compared to $31.72 million for the first half of 2007.  Diluted earnings per share for the six month periods are $0.67 for 2008 and $0.63 for 2007.1   Year-to-date 2008, annualized returns on average assets and average shareholders’ equity were 1.16% and 10.48%, respectively.   For the first six months of 2007, the annualized returns on average assets and average shareholders’ equity were 1.16% and 11.76%, respectively.

 As of June 30, 2008, National Penn’s total assets were $9.24 billion and total deposits were $6.08 billion. The allowance for loan and lease losses as of June 30, 2008 was $81.64 million, which represented 1.33% of total loans and leases outstanding of $6.13 billion.

 Commenting on second quarter 2008, Glenn E. Moyer, National Penn president and chief executive officer, said, “Despite the negative economic indications expressed daily in the media, National Penn continued to perform well during the second quarter.  We’re very pleased that we have been able to report record quarterly net income for the second quarter 2008.  With that said, we believe the interest rate, economic, and competitive environments will continue to challenge earnings performance at financial institutions for the foreseeable future.  Our National Penn team is working very hard to overcome these challenges, with a particular focus on maintaining credit quality, internal growth of capital, and expense management.”

 “The second quarter of 2008 was also very active with the integration of Christiana Bank & Trust and KNBT Bancorp.  In April, all data processing systems for KNBT were converted to National Penn system platforms.  We’re moving forward with the Christiana banking systems conversions scheduled for completion later in 2008.  We continue to be very pleased with the strong client focus of our combined organization, and early indications show KNBT customer retention levels to be outstanding.  While our stock price has been adversely affected like the rest of the financial services industry, we trust that our continuing strong performance will eventually provide some stability and support in this area.”

__________

12007 per share data is adjusted for the 3% stock dividend paid on September 28, 2007.

# # #

5

National Penn Bancshares, Inc.:

National Penn Bancshares, Inc., with $9.2 billion in assets, is the fifth largest bank holding company based in Pennsylvania.

Headquartered in Boyertown, National Penn operates 127 offices: 124 offices in Pennsylvania and one office in Maryland through National Penn Bank and its FirstService Bank, HomeTowne Heritage Bank, KNBT, and Nittany Bank divisions, and two offices in Delaware through its wholly-owned subsidiary, Christiana Bank & Trust Company.

National Penn's financial services affiliates consist of National Penn Investors Trust Company; National Penn Capital Advisors, Inc.; Vantage Investment Advisors, LLC; National Penn Leasing Company; National Penn Insurance Agency, Inc.; Caruso Benefits Group, Inc.; and Higgins Insurance Associates, Inc.

National Penn Bancshares, Inc. common stock is traded on the Nasdaq Stock Market under the symbol "NPBC". Additional information about the National Penn family is available on the Company's Web site at http://www.nationalpennbancshares.com.

#   #   #

_________

This press release contains supplemental financial information determined by methods other than in accordance with Accounting Principles Generally Accepted in the United States of America (“GAAP”).  National Penn’s management uses this non-GAAP measure in its analysis of the company’s performance.  This measure, annualized return on average tangible equity, excludes the average balance of acquisition-related goodwill and intangibles in determining average tangible shareholders’ equity.  Banking and financial institution regulators also exclude goodwill and intangibles from shareholders' equity when assessing the capital adequacy of a financial institution.  Management believes the presentation of this financial measure excluding the impact of these items provides useful supplemental information that is essential to a proper understanding of the financial results of National Penn, as it provides a method to assess management’s success in utilizing the company’s tangible capital.  This disclosure should not be viewed as a substitute for results determined in accordance with GAAP, nor is it necessarily comparable to non-GAAP performance measures that may be presented by other companies.

6

FINANCIAL HIGHLIGHTS
Dollars in thousands, except per share data	Three Months Ended June 30,									Six Months Ended June 30,
	2008			2007 (2)			% Change			2008			2007 (2)			% Change
STATEMENTS OF CONDITION
Total assets										$	9,241,355		$	5,621,170			64.4	%
Investment securities											1,943,438			1,309,669			48.4	%
Loans and leases											6,133,598			3,730,487			64.4	%
Deposits											6,083,717			3,825,786			59.0	%
Short-term borrowings											823,245			427,792			92.4	%
Long-term borrowings											1,173,678			770,515			52.3	%
Shareholders' equity											1,046,395			545,905			91.7	%
Book value per share											13.15			11.01			19.4	%
EARNINGS
Total interest income	$	119,503		$	82,851			44.2	%	$	229,906		$	163,244			40.8	%
Total interest expense		53,225			44,364			20.0	%		107,214			86,831			23.5	%
Net interest income		66,278			38,487			72.2	%		122,692			76,413			60.6	%
Provision for loan and lease losses		3,711			1,537			141.4	%		7,121			2,612			172.6	%
Net interest income after provision
for loan and lease losses		62,567			36,950			69.3	%		115,571			73,801			56.6	%
Other income		27,901			17,798			56.8	%		52,112			34,492			51.1	%
Other expenses		53,826			34,062			58.0	%		102,740			67,828			51.5	%
Income before income taxes		36,642			20,686			77.1	%		64,943			40,465			60.5	%
Income taxes		9,428			4,452			111.8	%		16,136			8,748			84.5	%
Net income	$	27,214		$	16,234			67.6	%	$	48,807		$	31,717			53.9	%
PERFORMANCE RATIOS
Net yield on earning assets		3.55	%		3.39	%		4.7	%		3.52	%		3.41	%		3.2	%
Return on average assets		1.20	%		1.17	%		2.6	%		1.16	%		1.16	%		0.0	%
Return on average shareholders' equity		10.42	%		11.91	%		-12.5	%		10.48	%		11.76	%		-10.9	%
Return on average tangible equity (1)		23.69	%		24.47	%		-3.2	%		22.77	%		24.43	%		-6.8	%
PER SHARE
Basic earnings	$	0.34		$	0.33			3.0	%	$	0.67		$	0.64			4.7	%
Diluted earnings	$	0.34		$	0.32			6.3	%	$	0.67		$	0.63			6.3	%
Dividends paid in cash	$	0.1700		$	0.1626			4.6	%	$	0.3400		$	0.3252			4.6	%
Average shares - basic		79,514,136			49,556,675			60.5	%		72,352,538			49,522,666			46.1	%
Average shares - diluted		80,626,387			50,181,973			60.7	%		73,086,087			50,182,978			45.6	%
(1) Reconciliation Table for Non-GAAP Financial Measure
Return on average shareholders' equity		10.42	%		11.91	%					10.48	%		11.76	%
Effect of goodwill and intangibles		13.27	%		12.56	%					12.29	%		12.67	%
Return on average tangible equity		23.69	%		24.47	%					22.77	%		24.43	%
Average tangible equity excludes acquisition related average goodwill and intangibles:
Average shareholders' equity	$	1,047,583		$	546,765					$	936,549		$	543,810
Average goodwill and intangibles		(586,729	)		(280,649	)					(505,498	)		(281,992	)
Average tangible equity		460,854			266,116						431,051			261,818
(2) Share and per share information adjusted for a 3% stock dividend paid September 28, 2007.

7

Financial Update for NATL PENN BCSHS (NPBC) FOR 6/30/08
Date	7/15/2008
	PAGE:  1 OF 5	AS OF			AS OF			AS OF			AS OF			AS OF
BALANCE SHEET - ASSETS ($000s)		6/30/2008			3/31/2008			12/31/2007			9/30/2007			6/30/2007
		(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)
	Cash & Cash Equivalents	$	205,457		$	201,655		$	111,520		$	99,379		$	125,128
	Held to Maturity Securities		406,653			271,381			243,595			244,815			245,964
	Securities Available for Sale		1,536,785			1,669,200			1,137,426			1,175,598			1,063,705
	Total Securities		1,943,438			1,940,581			1,381,021			1,420,413			1,309,669
	Total Cash and Securities		2,148,895			2,142,236			1,492,541			1,519,792			1,434,797
	Loans & Leases Held for Sale		5,269			5,711			3,823			2,127			9,305
	Loans & Leases Held for Investment		6,128,329			6,007,153			3,871,430			3,784,674			3,721,182
	Total Loans and Leases		6,133,598			6,012,864			3,875,253			3,786,801			3,730,487
	Loan Loss Reserve		(81,642	)		(81,631	)		(54,897	)		(56,294	)		(57,004	)
	Premises and Equipment, net		109,305			110,438			61,214			61,743			61,230
	Bank Owned Life Insurance		190,892			189,050			102,407			101,318			100,216
	Goodwill		545,460			545,484			261,552			261,161			261,161
	Other Intangibles		40,173			42,139			16,160			16,919			17,677
	Total Intangible Assets		585,633			587,623			277,712			278,080			278,838
	Unconsolidated Investments Under the Equity Method		10,985			12,609			11,490			10,058			10,724
	Real Estate Owned & Held for Investment		842			326			-			364			364
	Other Assets (2)		142,847			134,599			58,701			62,069			61,518
	Total Assets (2)	$	9,241,355		$	9,108,114		$	5,824,421		$	5,763,931		$	5,621,170
BALANCE SHEET - LIABILITIES ($000s)
	Interest-bearing Deposits	$	5,285,629		$	5,335,413		$	3,423,447		$	3,439,266		$	3,309,328
	Non-interest bearing Deposits	$	798,088		$	768,154		$	522,716		$	488,557		$	516,458
	Borrowings		1,854,775			1,698,974			1,114,206			1,080,221			1,055,527
	Subordinated Debt (Trust Preferred Securities)		142,148			141,009			139,997			141,591			142,780
	Other Liabilities		114,320			118,527			60,108			59,974			51,172
	Total Liabilities	$	8,194,960		$	8,062,077		$	5,260,474		$	5,209,609		$	5,075,265
BALANCE SHEET - EQUITY ($000s)
	Common Stock	$	978,546		$	975,744		$	491,011		$	490,872		$	466,837
	Retained Earnings		109,602			95,859			85,242			76,888			91,548
	Accumulated Other Comprehensive Income	$	(41,753	)	$	(25,485	)	$	(4,281	)	$	(6,458	)	$	(12,193	)
	Treasury Stock		-			(81	)		(8,025	)		(6,980	)		(287	)
	Total Shareholders Equity (2)	$	1,046,395		$	1,046,037		$	563,947		$	554,322		$	545,905
MEMO ITEMS
	Accumulated other comprehensive (loss) income	$	(41,753	)	$	(25,485	)	$	(4,281	)	$	(6,458	)	$	(12,193	)
	Book Value Per Share (1)(2)	$	13.15		$	13.17		$	11.49		$	11.28		$	11.01
	Tangible Book Value Per Share(1)(2)	$	5.78		$	5.77		$	5.83		$	5.62		$	5.39
	EOP Common Shares Outstanding (excluding Treasury shares)(1)		79,603,356			79,410,734			49,068,819			49,150,514			49,584,957
	Treasury Shares Held By Company (1)		-			5,064			544,061			477,117			16,470
	Did you announce a repurchase plan during this period?	NO			NO			NO			NO			NO
	Number of Shares to be Repurchased in Plans (1)		3,779,456			3,779,456			3,779,456			3,779,456			3,779,456
	Number of Shares Repurchased During Period (1)		-			33,587			326,039			594,566			86,229
	Average Price of Repurchased Shares (1)	$	-		$	16.38		$	14.76		$	14.61		$	17.92
	(1) Adjusted as necessary for a 3% stock dividend paid September 28, 2007.
	(2) Adjusted as necessary for modified retrospective method adoption under FAS123 ( R ).

8

Financial Update for NATL PENN BCSHS (NPBC) FOR 6/30/08
PAGE:  2 OF 5
	FOR QUARTER			FOR QUARTER			FOR QUARTER			FOR QUARTER			FOR QUARTER			YEAR			YEAR
	ENDED			ENDED			ENDED			ENDED			ENDED			TO DATE			TO DATE
INCOME STATEMENT ($000s)	6/30/2008			3/31/2008			12/31/2007			9/30/2007			6/30/2007			6/30/2008			6/30/2007
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)
Interest Income	$	119,503		$	110,403		$	86,502		$	85,727		$	82,851		$	229,906		$	163,244
Interest Expense		53,225			53,989			45,991			46,631			44,364			107,214			86,831
Net Interest Income		66,278			56,414			40,511			39,096			38,487			122,692			76,413
Loan and Lease Loss Provision		3,711			3,410			3,800			1,420			1,537			7,121			2,612
Net Interest Income after Provision for Loan and Lease Losses		62,567			53,004			36,711			37,676			36,950			115,571			73,801
Wealth Management Income		8,515			7,608			4,605			4,359			4,289			16,123			8,352
Service Charges on Deposits		6,324			5,261			4,499			4,461			4,314			11,585			8,412
Cash Management and Electronic Banking Fees		3,715			2,928			2,367			2,241			2,112			6,643			4,054
Mortgage Banking Income		978			591			512			468			1,110			1,569			1,986
Insurance Commissions and Fees		3,968			3,806			1,383			1,556			1,487			7,774			3,687
Bank Owned Life Insurance Income		1,842			1,580			1,089			1,102			1,078			3,422			2,177
Equity in Unconsolidated Investments		810			612			2,549			226			216			1,422			(373	)
Net Gains (Losses) on Sale of Investment Securities		384			-			331			600			564			384			1,133
Gain on Sale of Building(s)		-			-			-			279			170			-			170
BOLI Death Benefit Income		-			-			-			-			837			-			1,211
Other Non-Interest Income		1,365			1,825			3,121			2,958			1,621			3,190			3,683
Non-Recurring Income		-			-			-			-			-			-			-
Total Non-Interest Income		27,901			24,211			20,456			18,250			17,798			52,112			34,492
Salaries, Wages and Employee Benefits (2)		31,300			29,227			22,337			20,982			20,557			60,527			41,056
Net Premises and Equipment Expense		9,019			8,007			5,016			4,867			4,851			17,026			9,919
Amortization of Intangibles		1,964			1,582			758			758			759			3,546			1,518
Other Non-Interest Expense		11,543			10,098			8,733			7,494			7,895			21,641			15,335
Non-Recurring Expense		-			-			-			-			-			-			-
Total Non-Interest Expense  (2)		53,826			48,914			36,844			34,101			34,062			102,740			67,828
Net Income Before Taxes (2)		36,642			28,301			20,323			21,825			20,686			64,943			40,465
Income Tax Expense (2)		9,428			6,708			3,614			5,018			4,452			16,136			8,748
Net Income (2)		27,214			21,593			16,709			16,807			16,234			48,807			31,717
Net Interest Income (FTE)	$	71,176		$	60,999		$	44,883		$	43,260		$	42,278		$	132,175		$	83,841
EARNINGS PER SHARE:
Basic
Net income (1) (2)	$	0.34		$	0.33		$	0.34		$	0.34		$	0.33		$	0.67		$	0.64
Diluted
Net income (1) (2)	$	0.34		$	0.33		$	0.34		$	0.34		$	0.32		$	0.67		$	0.63
Average Shares Basic (1)		79,514,136			65,190,940			49,044,107			49,146,831			49,556,675			72,352,538			49,522,666
Average Shares Diluted (1)		80,626,387			65,899,893			49,496,144			49,641,283			50,181,973			73,086,087			50,182,978
(1)  Adjusted as necessary for a 3% stock dividend paid September 28, 2007.
(2)  Adjusted as necessary for modified retrospective method adoption under FAS123 ( R ).
SUPPLEMENTAL DATA ($000s) (4)
Return on Avg. Assets (annualized)		1.20	%		1.10	%		1.15	%		1.18	%		1.17	%		1.16	%		1.16	%
Return on Avg. Equity (annualized)		10.42	%		10.54	%		11.96	%		12.30	%		11.91	%		10.48	%		11.76	%
Return on Avg. Tangible Equity (annualized) (3)		23.69	%		21.84	%		23.96	%		25.29	%		24.47	%		22.77	%		24.43	%
Average Tangible Equity to Tangible Assets   (5)		5.45	%		5.31	%		5.04	%		4.90	%		5.06	%		5.38	%		5.02	%
Average Realized Tangible Equity to Average Tangible Assets Ratio (6)		5.77	%		5.38	%		5.14	%		5.10	%		5.10	%		5.58	%		5.04	%
(3) (Net income x (366/91)), divided by (average equity - average goodwill and intangibles).
(5) Average tangible equity, divided by (average assets - average goodwill and intangibles).
(6) (Average tangible equity - average AOCI), divided by average tangible assets.
(3) (4) Reconciliation Table for Non-GAAP Financial Measure
Return on average shareholders' equity		10.42	%		10.54	%		11.96	%		12.30	%		11.91	%		10.48	%		11.76	%
Effect of goodwill and intangibles		13.27	%		11.30	%		12.00	%		12.99	%		12.56	%		12.29	%		12.67	%
Return on average tangible equity		23.69	%		21.84	%		23.96	%		25.29	%		24.47	%		22.77	%		24.43	%
Average tangible equity excludes acquisition related average goodwill and intangibles:
Average shareholders' equity	$	1,047,583		$	823,757		$	554,334		$	542,052		$	546,765		$	936,549		$	543,810
Average goodwill and intangibles		(586,729	)		(426,039	)		(277,691	)		(278,441	)		(280,649	)		(505,498	)		(281,992	)
Average tangible equity		460,854			397,718			276,643			263,611			266,116			431,051			261,818

9

Financial Update for NATL PENN BCSHS (NPBC) FOR 6/30/08
PAGE:  3 of 5
	FOR QUARTER			FOR QUARTER			FOR QUARTER			FOR QUARTER			FOR QUARTER			FOR QUARTER			YEAR			YEAR
	ENDED			ENDED			ENDED			ENDED			ENDED			ENDED			TO DATE			TO DATE
CHARGEOFFS ($000s)	6/30/2008			3/31/2008			12/31/2007			9/30/2007			6/30/2007			3/31/2007			6/30/2008			6/30/2007
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)
Loan Chargeoffs	$	4,508		$	3,001		$	5,624		$	2,482		$	2,859		$	2,086		$	7,509		$	4,945
Recoveries on Loans		(808	)		(440	)		(428	)		(352	)		(555	)		(475	)	$	(1,248	)	$	(1,030	)
Net Loan Chargeoffs	$	3,700		$	2,561		$	5,196		$	2,130		$	2,304		$	1,611		$	6,261		$	3,915
Net Loan Chargeoffs to Average Loans (non-annualized)		0.06	%		0.05	%		0.14	%		0.06	%		0.06	%		0.05	%		0.11	%		0.11	%
ASSET QUALITY AND OTHER DATA	AS OF			AS OF			AS OF			AS OF			AS OF			AS OF
($000s)	6/30/2008			3/31/2008			12/31/2007			9/30/2007			6/30/2007			3/31/2007
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)
Nonaccrual Loans	$	18,566		$	22,679		$	15,198		$	8,435		$	12,270		$	12,077
Renegotiated Loans		631			-			-			-			-			-
Other Real Estate Owned		842			326			-			364			364			140
Total Non-performing Assets	$	20,039		$	23,005		$	15,198		$	8,799		$	12,634		$	12,217
Loans 90+ Days Past Due & Still Accruing		2,586			1,140			87			67			619			243
Non-performing + Loans 90 Days Past Due	$	22,625		$	24,145		$	15,285		$	8,866		$	13,253		$	12,460
Allowance for Loan and Lease Losses	$	81,642		$	81,631		$	54,897		$	56,294		$	57,004		$	57,771
Coverage Ratio		360.8	%		338.1	%		359.2	%		634.9	%		430.1	%		463.7	%
REGULATORY CAPITAL DATA	AS OF			AS OF			AS OF			AS OF			AS OF			AS OF
($000s) (1)	6/30/2008			3/31/2008			12/31/2007			9/30/2007			6/30/2007			3/31/2007
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)
Tier 1 Capital	$	642,223		$	622,391		$	426,236		$	420,014		$	417,762		$	405,972
Tier 1 Ratio (%)		9.39	%		9.11	%		9.54	%		9.64	%		9.93	%		9.92	%
Total Capital (Tier 1 + Tier 2)	$	723,865		$	704,087		$	482,692		$	475,596		$	470,902		$	459,795
Total Capital Ratio (%)		10.59	%		10.31	%		10.81	%		10.91	%		11.20	%		11.23	%
Total Risk-Adjusted Assets	$	6,837,963		$	6,829,295		$	4,466,824		$	4,358,884		$	4,206,000		$	4,093,619
Tier 1 Leverage Ratio		7.60	%		8.50	%		7.76	%		7.80	%		7.94	%		8.00	%
Tangible Equity to Tangible Assets Ratio		5.32	%		5.38	%		5.16	%		5.04	%		5.00	%		5.12	%
Realized Tangible Equity to Tangible Assets Ratio		5.81	%		5.68	%		5.24	%		5.15	%		5.23	%		5.11	%
SUPPLEMENTAL DATA	AS OF			AS OF			AS OF			AS OF			AS OF			AS OF
($000s)	6/30/2008			3/31/2008			12/31/2007			9/30/2007			6/30/2007			3/31/2007
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)
Held to Maturity Securities (Fair Value)	$	371,788		$	269,382		$	243,218		$	243,593		$	238,741		$	247,444
Common Stock Dividends (total $ in period)	$	13,509		$	8,825		$	8,354		$	8,066		$	8,066		$	8,048
Dividends per Common Share (2)	$	0.1700		$	0.1700		$	0.1700		$	0.1626		$	0.1626		$	0.1626
EOP Employees (Full Time Equivalent)		1,816			1,906			1,171			1,185			1,227			1,195
(1) Adjusted as necessary for modified retrospective method adoption under FAS123 ( R ).
(2) Adjusted as necessary for a 3% stock dividend paid September 28, 2007.

10

Financial Update for NATL PENN BCSHS (NPBC) FOR 6/30/08
PAGE:  4 of 5	AS OF		AS OF		AS OF		AS OF		AS OF
PERIOD END BALANCES:	6/30/2008		3/31/2008		12/31/2007		9/30/2007		6/30/2007
	(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
Earning Assets / Liabilities
Loan Breakdown:  (Regulatory)
Commercial/Industrial	$	1,131,389	$	1,098,437	$	723,144	$	713,887	$	695,396
Commercial Real Estate		1,735,011		1,609,201		1,329,482		1,304,911		1,277,469
Residential Mortgage (including multi-family)		1,525,791		1,594,672		795,151		781,087		798,808
Real Estate Construction and Land Development		549,346		537,310		328,720		310,372		295,618
Home Equity (revolving and 2nd lien)		765,108		762,717		464,673		447,130		441,579
Consumer (Loans to Individuals)		221,772		224,594		73,494		70,817		63,558
Other Loans		205,180		185,933		160,589		158,597		158,059
Total Loans (net of unearned)		6,133,597		6,012,864		3,875,253		3,786,801		3,730,487
Investment Securities		1,943,438		1,941,582		1,381,021		1,420,413		1,309,669
Other Earning Assets		30,686		33,520		7,228		5,616		3,933
Total Earning Assets (net of loan loss reserve)	$	8,026,080	$	7,906,335	$	5,208,604	$	5,156,536	$	4,987,085
Deposit Breakdown:
Savings	$	392,669	$	377,416	$	193,938	$	193,232	$	208,694
NOW Accounts		863,879		932,132		733,242		775,385		722,656
Money Market Accounts		1,716,021		1,679,063		957,423		951,104		960,302
CDs $100m or less		1,539,392		1,722,316		992,741		1,008,792		961,964
CDs greater than $100m		773,669		624,488		546,103		510,753		455,712
Total Int. Bearing Deposits		5,285,630		5,335,415		3,423,447		3,439,266		3,309,328
Short-Term Borrowings		823,245		678,581		497,023		452,761		427,792
Long-Term Debt		1,173,678		1,161,403		757,180		769,051		770,515
Total Int. Bearing Liabilities	$	7,282,553	$	7,175,399	$	4,677,650	$	4,661,078	$	4,507,635
Loan Breakdown: (Internal)
Business Purpose Loans	$	2,533,419	$	2,575,761	$	1,621,101	$	1,571,459	$	1,542,646
Residential Mortgage		1,056,541		1,069,643		494,413		485,967		515,339
Commercial Real Estate, Construction and Land Dev		1,590,513		1,389,608		1,296,277		1,265,904		1,215,586
Consumer (loans to Individual)		953,124		977,852		463,462		463,471		456,916
Total Loans (net of unearned)	$	6,133,597	$	6,012,864	$	3,875,253	$	3,786,801	$	3,730,487

11

Financial Update for NATL PENN BCSHS (NPBC) FOR 6/30/08
	PAGE 5 OF 5
BALANCE AND YIELD/COST ANALYSIS:			AS OF					AS OF					AS OF					AS OF					AS OF					YTD					YTD
			6/30/2008					3/31/2008					12/31/2007					9/30/2007					6/30/2007					6/30/2008					6/30/2007
			(unaudited)					(unaudited)					(unaudited)					(unaudited)					(unaudited)					(unaudited)					(unaudited)
			Qtr Avg Bal		Yield			Qtr Avg Bal		Yield			Qtr Avg Bal		Yield			Qtr Avg Bal		Yield			Qtr Avg Bal		Yield			YTD Avg Bal		Yield			YTD Avg Bal		Yield
Total Loans (net of unearned)			$	6,027,845		6.45	%	$	5,296,371		6.80	%	$	3,825,406		7.24	%	$	3,756,081		7.40	%	$	3,700,384		7.35	%	$	5,662,108		6.65	%	$	3,669,984		7.35	%
Investment Securities  (incl. trading assets)				1,920,200		5.46	%		1,802,951		5.63	%		1,393,393		5.98	%		1,356,853		5.78	%		1,302,524		5.79	%		1,861,575		5.57	%		1,287,073		5.76	%
Other Earning Assets				26,752		5.58	%		24,148		2.22	%		10,550		3.35	%		4,656		4.60	%		3,958		6.18	%		23,478		4.35	%		8,347		2.73	%
Total Earning Assets				7,974,797		6.21	%		7,123,470		6.49	%		5,229,349		6.89	%		5,117,590		6.97	%		5,006,866		6.94	%		7,547,161		6.38	%		4,965,404		6.93	%
Total Earning Assets  (net of loan loss reserve)				7,892,174		6.27	%		7,051,565		6.56	%		5,172,622		6.97	%		5,060,766		7.05	%		4,948,851		7.02	%		7,469,898		6.44	%		4,907,154		7.01	%
Total Assets				9,037,448		5.48	%		7,886,342		5.86	%		5,768,409		6.25	%		5,661,055		6.30	%		5,542,100		6.27	%		8,459,924		5.69	%		5,497,399		6.26	%
Savings				379,866		0.53	%		316,680		0.71	%		193,088		1.08	%		200,665		1.11	%		212,624		1.12	%		348,274		0.62	%		214,364		1.14	%
NOW Accounts				898,257		1.19	%		843,526		1.79	%		766,446		2.65	%		734,140		2.67	%		689,712		2.53	%		870,891		1.49	%		657,587		2.42	%
Money Market Accounts				1,649,955		2.27	%		1,416,426		2.78	%		961,975		3.38	%		965,630		3.65	%		944,773		3.68	%		1,531,219		2.53	%		942,200		3.66	%
Certificates				2,324,339		3.95	%		2,097,691		4.32	%		1,512,883		4.70	%		1,457,016		4.76	%		1,437,808		4.74	%		2,211,015		4.15	%		1,456,955		4.71	%
Total Int. Bearing Deposits				5,252,417		2.70	%		4,674,323		3.16	%		3,434,392		3.67	%		3,357,451		3.77	%		3,284,917		3.74	%		4,961,399		2.93	%		3,271,106		3.72	%
Non-Interest Bearing Deposits				753,052					649,278					493,152					499,398					500,580					701,165					494,157
Total Deposits				6,005,469		2.36	%		5,323,601		2.77	%		3,927,544		3.21	%		3,856,849		3.28	%		3,785,497		3.24	%		5,662,564		2.57	%		3,765,263		3.23	%
Short-Term Borrowings				720,965		2.94	%		643,958		3.29	%		463,461		3.82	%		437,019		4.03	%		496,311		4.28	%		682,462		3.12	%		500,032		4.21	%
Long-Term Borrowings				1,149,476		4.22	%		1,049,870		4.61	%		758,929		5.10	%		770,371		5.31	%		660,668		5.14	%		1,099,673		4.43	%		629,884		5.16	%
Total Int. Bearing Liabilities (incl. non-int bearing deposits)		7,875,910				2.69	%		7,017,429		3.09	%		5,149,934		3.54	%		5,064,239		3.65	%		4,942,476		3.60	%		7,444,699		2.90	%		4,895,179		3.58	%
Total Int. Bearing Liabilities				7,122,858		2.97	%		6,368,151		3.41	%		4,656,782		3.92	%		4,564,841		4.05	%		4,441,896		4.01	%		6,743,534		3.20	%		4,401,022		3.98	%

Net Yield on Earning Assets (net of loan loss reserve): (Margin)	3.59%		3.48%	3.44%	3.39%	3.43%	3.56%	3.45%
Net Yield on Earning Assets: (Margin)		3.55%	3.44%	3.41%	3.35%	3.39%	3.52%	3.41	%

STATES OF OPERATION AND BANKING OFFICES BY STATE (LATEST AVAILABLE DATA)
	State	Number of Full Service Banking Offices (Domestic and in the U.S. Territories)
	PA
Total Number of Banking Offices				124	132	81	81	80
Total Number of Insured Subsidiaries (Bank & Thrift Subsidiaries)			1		1	1	1	1
Total Number of ATMs				145	152	81	83	83
	MD
Total Number of Banking Offices				1	1	1	1	1
Total Number of Insured Subsidiaries (Bank & Thrift Subsidiaries)				0	0	0	0	0
Total Number of ATMs				1	1	1	1	1
	DE
Total Number of Banking Offices				2	2	0	0	0
Total Number of Insured Subsidiaries (Bank & Thrift Subsidiaries)				1	1	0	0	0
Total Number of ATMs				1	1	1	0	0
	TOTAL
Total Number of Banking Offices				127	135	82	82	81
Total Number of Insured Subsidiaries (Bank & Thrift Subsidiaries)			2		2	1	1	1
Total Number of ATMs				147	154	83	84	84
Have you restated any prior period's financial statements for a pooling of interest and/or a change in accounting principles?  NO
Periods Restated on this report:
Reason: