EXHIBIT 99.1
News Release
 |
National Penn Bancshares, Inc.
Reports Financial Results
| 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., April 29, 2009 -- National Penn Bancshares, Inc. (Nasdaq: NPBC) reported first quarter 2009 net income available to common shareholders of $1.75 million, or $0.02 per diluted share, after payment of the U.S. Treasury’s Capital Purchase Program Series B preferred stock dividend. Excluding two non-cash items, an other-than-temporary impairment charge of $0.06 per diluted share and a negative fair value mark of $0.02 per diluted share on NPB Capital Trust II preferred securities, core earnings for first quarter 2009 were $0.10 per diluted share. In comparison, for the first quarter 2008, net income was $21.59 million, or $0.33 per diluted share.
Including the two items briefly noted above, first quarter 2009 results were adversely impacted by three key items (pre-tax):
| · | A non-cash other-than-temporary credit-related impairment charge of $7.79 million on collateralized debt obligation (CDO) | |
| (CDO) investments in pooled trust preferred securities. |
| · | A first quarter 2009 provision for credit losses of $17.53 million. |
| · | A negative fair value mark of $1.90 million on NPB Capital Trust II preferred securities. |
As of March 31, 2009, National Penn’s total assets were $9.63 billion and total deposits were $6.66 billion. The allowance for loan and lease losses as of March 31, 2009 was $86.27 million, which represented 1.36% of total loans and leases outstanding of $6.37 billion. From a regulatory capital standpoint, National Penn, and each of National Penn’s banking subsidiaries, National Penn Bank and Christiana Bank & Trust Company, all continue to be “well capitalized” under all guidelines imposed by financial institution regulators. National Penn’s Tier 1 Risk-Based Capital and Total Risk-Based Capital Ratios are 10.44% and 11.61% respectively, are in excess of well capitalized minimum requirements of 6.00% and 10.00%, respectively.
Net loan growth for first quarter 2009 was $49.18 million. First quarter deposit growth for 2009 was in excess of $270 million, which continues to reflect the confidence clients have in the overall strength of National Penn.
Commenting on first quarter 2009 results, Glenn E. Moyer, National Penn president and chief executive officer, said, “Our financial results continue to be challenged by the unprecedented economic situation at the local, national, and global levels. We currently are anticipating minimal economic recovery in 2009. Despite these strong negative headwinds, National Penn’s core earnings remain sound. While we found it necessary to take further non-cash charges on investment securities and historically elevated charges for credit losses, we believe our overall performance continues to show the financial strength of National Penn. We’re pleased that we’ve been able to grow our loans in this environment at a time when other financial institutions are experiencing a decline in their overall loan portfolios. National Penn has not stopped lending, and will continue to actively lend money to, and gather deposits from, qualified consumers and businesses.”
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5
About National Penn Bancshares, Inc.:
National Penn Bancshares, Inc., with $9.6 billion in assets, is the fourth largest bank holding company based in Pennsylvania. In addition, wealth assets under administration or management amount to $7.9 billion.
Headquartered in Boyertown, National Penn operates 127 offices. It has 124 community banking offices in Pennsylvania and one office in Maryland through National Penn Bank and its HomeTowne Heritage Bank, KNBT and Nittany Bank divisions. National Penn also has 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; Institutional 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”. Please visit our Web site at www.nationalpennbancshares.com to see our regularly posted material information.
Statement Regarding Non-GAAP Financial Measures:
This 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 these non-GAAP measures in its analysis of National Penn’s performance. One such 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. The other such measure, core net income (or core earnings), excludes the effects of non-cash, after-tax unrealized gains and losses. Management believes the presentation of these financial measures excluding the impact of the specified items provides useful supplemental information that is essential to a proper understanding of the financial results of National Penn. In the case of annualized return on average tangible equity, it provides a method to assess management’s success in utilizing the company’s tangible capital. In the case of core net income (or core earnings), it provides a method to assess earnings performance excluding one-time items. 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.
Cautionary Statement Regarding Forward-Looking Information:
This release contains forward-looking information about National Penn Bancshares, Inc. that is intended to be covered by the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts. These statements can be identified by the use of forward-looking terminology such as “believe,” “expect,” “may,” “will,” “should,’’ “project,” “plan,’’ “seek,” “intend,’’ or “anticipate’’ or the negative thereof or comparable terminology, and include discussions of strategy, financial projections and estimates and their underlying assumptions, statements regarding plans, objectives, expectations or consequences of announced transactions, and statements about the future performance, operations, products and services of National Penn and its subsidiaries. National Penn cautions readers not to place undue reliance on these statements.
National Penn’s business and operations are subject to a variety of risks, uncertainties and other factors. Consequently, actual results and experience may materially differ from those contained in any forward-looking statements. Such risks, uncertainties and other factors that could cause actual results and experience to differ from those projected include, but are not limited to, the following: National Penn’s obligations under the U.S. Treasury’s TARP Capital Purchase Program; ability to obtain new capital and locate growth opportunities; the ineffectiveness of National Penn’s business strategy due to changes in current or future market conditions; the effects of competition, and of changes in laws and regulations on competition, including industry consolidation and development of competing financial products and services; interest rate movements; the performance of National Penn’s investment portfolio; inability to achieve merger-related synergies; difficulties in integrating distinct business operations, including information technology difficulties; disruption from announced transactions, and resulting difficulties in maintaining relationships with customers and employees; and challenges in establishing and maintaining operations in new markets. The foregoing review of important factors should be read in conjunction with the risk factors and other cautionary statements included in National Penn’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008, as well as in National Penn’s Quarterly Reports on Form 10-Q and other documents filed by National Penn with the SEC after the date thereof. National Penn makes no commitment to revise or update any forward-looking statements in order to reflect events or circumstances occurring or existing after the date any forward-looking statement is made.
6
National Penn Bancshares, Inc.
Exchange Listing Nasdaq "NPBC"
| FINANCIAL HIGHLIGHTS | Three Months Ended March 31, | |||||||||||
| Dollars in thousands, except per share data | 2009 | 2008 | % Change | |||||||||
| STATEMENTS OF CONDITION | ||||||||||||
| Total assets | $ | 9,633,042 | $ | 9,108,114 | 5.8 | % | ||||||
| Investment securities | 1,914,038 | 1,941,582 | -1.4 | % | ||||||||
| Loans and leases | 6,365,052 | 6,000,252 | 6.1 | % | ||||||||
| Deposits | 6,660,234 | 6,103,567 | 9.1 | % | ||||||||
| Short-term borrowings | 653,805 | 678,581 | -3.7 | % | ||||||||
| Long-term borrowings | 1,060,756 | 1,161,402 | -8.7 | % | ||||||||
| Shareholders' equity | 1,176,102 | 1,046,037 | 12.4 | % | ||||||||
| Book value per share | 14.17 | 14.20 | -0.2 | % | ||||||||
| Common Book value per share | 12.43 | 13.17 | -5.6 | % | ||||||||
| EARNINGS | ||||||||||||
| Total interest income | $ | 105,951 | $ | 110,403 | -4.0 | % | ||||||
| Total interest expense | 47,321 | 53,989 | -12.4 | % | ||||||||
| Net interest income | 58,630 | 56,414 | 3.9 | % | ||||||||
| Provision for loan and lease losses | 17,525 | 3,410 | 413.9 | % | ||||||||
| Net interest income after provision for loan and lease losses | 41,105 | 53,004 | -22.4 | % | ||||||||
| Other income | 15,214 | 24,211 | -37.9 | % | ||||||||
| Other expenses | 56,693 | 48,914 | 15.6 | % | ||||||||
| Income before income taxes | (374 | ) | 28,301 | -101.3 | % | |||||||
| Income taxes | (4,173 | ) | 6,708 | -162.2 | % | |||||||
| Net income | $ | 3,799 | $ | 21,593 | -82.4 | % | ||||||
| Preferred dividends/accretion of preferred discount | (2,054 | ) | - | - | ||||||||
| Net Income Available to Common Shareholders | 1,745 | 21,593 | -91.9 | % | ||||||||
| PERFORMANCE RATIOS | ||||||||||||
| Net yield on earning assets | 3.13 | % | 3.44 | % | -9.0 | % | ||||||
| Return on average assets | 0.16 | % | 1.10 | % | -85.5 | % | ||||||
| Return on average shareholders' equity | 1.31 | % | 10.54 | % | -87.6 | % | ||||||
| Return on average tangible equity (1) | 2.64 | % | 21.84 | % | -87.9 | % | ||||||
| PER SHARE | ||||||||||||
| Basic earnings available to common shareholders | $ | 0.02 | $ | 0.33 | -93.9 | % | ||||||
| Diluted earnings available to common shareholders | $ | 0.02 | $ | 0.33 | -93.9 | % | ||||||
| Dividends paid in cash | $ | 0.1700 | $ | 0.1700 | 0.0 | % | ||||||
| Average shares - basic | 81,497,806 | 65,190,940 | 25.0 | % | ||||||||
| Average shares - diluted | 81,891,272 | 65,899,893 | 24.3 | % | ||||||||
7
(1) Reconciliation Tables for Non-GAAP Financial Measures
| Return on average shareholders' equity | 1.31 | % | 10.54 | % | ||||
| Effect of goodwill and intangibles | 1.33 | % | 11.30 | % | ||||
| Return on average tangible equity | 2.64 | % | 21.84 | % | ||||
| Average tangible equity excludes acquisition related average goodwill and intangibles: | ||||||||
| Average shareholders' equity | $ | 1,176,494 | $ | 823,757 | ||||
| Average goodwill and intangibles | (592,816 | ) | (426,039 | ) | ||||
| Average total tangible equity | $ | 583,678 | $ | 397,718 | ||||
| Net Income available to common shareholders | $ | 1,745 | $ | 21,593 | ||||
| After tax unrealized fair market value loss on | ||||||||
| NPB Capital Trust II Preferred Securities | 1,234 | 658 | ||||||
| After tax other than temporary impairment charge on CDO investment | 5,060 | - | ||||||
| Core net income | $ | 8,039 | $ | 22,251 | ||||
| Diluted earnings per share | $ | 0.02 | $ | 0.33 | ||||
| After tax unrealized fair market value loss on | ||||||||
| NPB Capital Trust II Preferred Securities | 0.02 | 0.01 | ||||||
| After tax other than temporary impairment charge on CDO investment | 0.06 | - | ||||||
| Core diluted earnings per share | $ | 0.10 | $ | 0.34 |
8
| Financial Update for NATL PENN BCSHS (NPBC) FOR 3/31/09 | ||||||||||||||||||||
| PAGE: 1 OF 5 | AS OF | AS OF | AS OF | AS OF | AS OF | |||||||||||||||
| BALANCE SHEET - ASSETS ($000s) | 3/31/2009 | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | |||||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||||
| Cash & Cash Equivalents | $ | 389,024 | $ | 195,830 | $ | 152,909 | $ | 205,457 | $ | 201,655 | ||||||||||
| Held to Maturity Securities | 299,645 | 326,090 | 391,725 | 406,653 | 271,381 | |||||||||||||||
| Securities Available for Sale | 1,614,393 | 1,593,799 | 1,587,852 | 1,536,785 | 1,669,200 | |||||||||||||||
| Total Securities | 1,914,038 | 1,919,889 | 1,979,577 | 1,943,438 | 1,941,582 | |||||||||||||||
| Total Cash and Securities | 2,303,062 | 2,115,719 | 2,132,486 | 2,148,895 | 2,142,236 | |||||||||||||||
| Loans & Leases Held for Sale | 17,806 | 3,605 | 5,317 | 5,269 | 5,711 | |||||||||||||||
| Loans & Leases Held for Investment | 6,347,246 | 6,312,269 | 6,189,567 | 6,114,733 | 5,994,541 | |||||||||||||||
| Total Loans and Leases | 6,365,052 | 6,315,874 | 6,194,884 | 6,120,002 | 6,000,252 | |||||||||||||||
| Loan Loss Reserve | (86,273 | ) | (84,006 | ) | (83,696 | ) | (81,642 | ) | (81,631 | ) | ||||||||||
| Premises and Equipment, net | 116,885 | 119,924 | 119,705 | 122,901 | 123,050 | |||||||||||||||
| Premises held for sale | 812 | 3,768 | 3,890 | 4,188 | 3,894 | |||||||||||||||
| Bank Owned Life Insurance | 194,883 | 193,811 | 192,594 | 190,892 | 189,050 | |||||||||||||||
| Goodwill | 556,031 | 558,252 | 546,270 | 545,460 | 545,484 | |||||||||||||||
| Other Intangibles | 35,557 | 37,496 | 38,768 | 40,173 | 42,139 | |||||||||||||||
| Total Intangible Assets | 591,588 | 595,748 | 585,038 | 585,633 | 587,623 | |||||||||||||||
| Unconsolidated Investments Under the Equity Method | 12,966 | 11,874 | 11,470 | 10,985 | 12,609 | |||||||||||||||
| Other Real Estate Owned | 1,862 | 783 | 1,129 | 842 | 326 | |||||||||||||||
| Other Assets | 132,205 | 129,936 | 159,295 | 138,659 | 130,705 | |||||||||||||||
| Total Assets | $ | 9,633,042 | $ | 9,403,431 | $ | 9,316,795 | $ | 9,241,355 | $ | 9,108,114 | ||||||||||
| BALANCE SHEET - LIABILITIES ($000s) | ||||||||||||||||||||
| Interest-bearing Deposits | $ | 5,929,420 | $ | 5,596,617 | $ | 5,437,824 | $ | 5,285,629 | $ | 5,335,413 | ||||||||||
| Noninterest-bearing Deposits | $ | 730,814 | $ | 793,269 | $ | 782,819 | $ | 798,088 | $ | 768,154 | ||||||||||
| Borrowings | 1,584,684 | 1,607,290 | 1,838,928 | 1,854,775 | 1,698,974 | |||||||||||||||
| Subordinated Debt (Trust Preferred Securities) | 129,877 | 127,980 | 134,507 | 142,148 | 141,009 | |||||||||||||||
| Other Liabilities | 82,145 | 98,280 | 76,704 | 114,320 | 118,527 | |||||||||||||||
| Total Liabilities | $ | 8,456,940 | $ | 8,223,436 | $ | 8,270,782 | $ | 8,194,960 | $ | 8,062,077 | ||||||||||
| BALANCE SHEET - EQUITY ($000s) | ||||||||||||||||||||
| Preferred Stock | $ | 144,297 | $ | 144,076 | $ | - | $ | - | $ | - | ||||||||||
| Common Stock | 1,019,548 | 1,003,110 | 980,894 | 978,546 | 975,744 | |||||||||||||||
| Retained Earnings | 65,765 | 65,194 | 115,291 | 109,602 | 95,859 | |||||||||||||||
| Accumulated Other Comprehensive Income | $ | (53,508 | ) | $ | (32,385 | ) | $ | (50,172 | ) | $ | (41,753 | ) | $ | (25,485 | ) | |||||
| Treasury Stock | - | - | - | - | (81 | ) | ||||||||||||||
| Total Shareholders Equity | $ | 1,176,102 | $ | 1,179,995 | $ | 1,046,013 | $ | 1,046,395 | $ | 1,046,037 | ||||||||||
| MEMO ITEMS | ||||||||||||||||||||
| Held to Maturity Securities (Fair Value) | $ | 271,423 | $ | 284,608 | $ | 305,164 | $ | 371,788 | $ | 269,382 | ||||||||||
| Common Book Value Per Share | $ | 12.43 | $ | 12.83 | $ | 13.09 | $ | 13.15 | $ | 13.17 | ||||||||||
| Total Book Value Per Share | $ | 14.17 | $ | 14.62 | $ | - | $ | - | $ | - | ||||||||||
| Tangible Common Book Value Per Share | $ | 5.30 | $ | 5.45 | $ | 5.77 | $ | 5.78 | $ | 5.77 | ||||||||||
| Tangible Total Book Value Per Share | $ | 7.04 | $ | 7.24 | $ | - | $ | - | $ | - | ||||||||||
| EOP Common Shares Outstanding (excluding Treasury shares) | 83,005,701 | 80,731,751 | 79,886,282 | 79,603,356 | 79,410,734 | |||||||||||||||
| Treasury Shares Held By Company | - | - | - | - | 5,064 | |||||||||||||||
| Common Stock Dividends (total $ in period) | $ | 13,800 | $ | 13,805 | $ | 13,541 | $ | 13,509 | $ | 8,825 | ||||||||||
| Dividends per Common Share | $ | 0.1700 | $ | 0.1725 | $ | 0.1700 | $ | 0.1700 | $ | 0.1700 | ||||||||||
| Number of Shares to be Repurchased in Plans | 3,779,456 | 3,779,456 | 3,779,456 | 3,779,456 | 3,779,456 | |||||||||||||||
| Number of Shares Repurchased During Period | - | - | - | - | 33,587 | |||||||||||||||
| Average Price of Repurchased Shares | $ | - | $ | - | $ | - | $ | - | $ | 16.38 | ||||||||||
9
| Financial Update for NATL PENN BCSHS (NPBC) FOR 3/31/09 | ||||||||||||||||||||
| PAGE: 2 OF 5 | ||||||||||||||||||||
| FOR QUARTER | FOR QUARTER | FOR QUARTER | FOR QUARTER | FOR QUARTER | ||||||||||||||||
| ENDED | ENDED | ENDED | ENDED | ENDED | ||||||||||||||||
| INCOME STATEMENT ($000s) | 3/31/2009 | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | |||||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||||
| Interest Income | $ | 105,951 | $ | 115,613 | $ | 120,717 | $ | 119,503 | $ | 110,403 | ||||||||||
| Interest Expense | 47,321 | 52,515 | 53,769 | 53,225 | 53,989 | |||||||||||||||
| Net Interest Income | 58,630 | 63,098 | 66,948 | 66,278 | 56,414 | |||||||||||||||
| Loan and Lease Loss Provision | 17,525 | 18,500 | 6,876 | 3,711 | 3,410 | |||||||||||||||
| Net Interest Income after Provision for Loan and Lease Losses | 41,105 | 44,598 | 60,072 | 62,567 | 53,004 | |||||||||||||||
| Wealth Management Income | 6,615 | 7,543 | 8,239 | 8,515 | 7,608 | |||||||||||||||
| Service Charges on Deposits | 5,800 | 6,685 | 6,880 | 6,324 | 5,261 | |||||||||||||||
| Cash Management and Electronic Banking Fees | 3,648 | 3,826 | 3,917 | 3,715 | 2,928 | |||||||||||||||
| Mortgage Banking Income | 2,420 | 856 | 882 | 978 | 591 | |||||||||||||||
| Insurance Commissions and Fees | 3,957 | 3,691 | 3,913 | 3,968 | 3,806 | |||||||||||||||
| Bank Owned Life Insurance Income | 1,072 | 1,217 | 1,702 | 1,842 | 1,580 | |||||||||||||||
| Equity in Unconsolidated Investments | 1,091 | 1,550 | 1,574 | 810 | 612 | |||||||||||||||
| Net gains (losses) from fair value changes | (1,898 | ) | 6,527 | 7,641 | (1,139 | ) | (1,012 | ) | ||||||||||||
| Net gains (losses) on Investment Securities | (2,284 | ) | 12 | 276 | 384 | - | ||||||||||||||
| Other Non-Interest Income | 2,578 | 1,385 | 1,826 | 2,504 | 2,837 | |||||||||||||||
| Other than temporary impairment on investments | (7,785 | ) | (79,496 | ) | (20,000 | ) | - | - | ||||||||||||
| Total Non-Interest Income | 15,214 | (46,204 | ) | 16,850 | 27,901 | 24,211 | ||||||||||||||
| Salaries, Wages and Employee Benefits | 32,017 | 30,807 | 31,998 | 31,300 | 29,227 | |||||||||||||||
| Net Premises and Equipment Expense | 8,598 | 7,108 | 8,416 | 9,019 | 8,007 | |||||||||||||||
| Amortization of Intangibles | 1,940 | 1,996 | 1,981 | 1,964 | 1,582 | |||||||||||||||
| Other Non-Interest Expense | 14,138 | 15,293 | 11,692 | 11,543 | 10,098 | |||||||||||||||
| Fraud Expense | - | 4,500 | - | - | - | |||||||||||||||
| Total Non-Interest Expense | 56,693 | 59,704 | 54,087 | 53,826 | 48,914 | |||||||||||||||
| Net Income Before Taxes | (374 | ) | (61,310 | ) | 22,835 | 36,642 | 28,301 | |||||||||||||
| Income Tax Expense | (4,173 | ) | (25,546 | ) | 3,607 | 9,428 | 6,708 | |||||||||||||
| Net Income | 3,799 | (35,764 | ) | 19,228 | 27,214 | 21,593 | ||||||||||||||
| Preferred dividends/accretion of preferred discount | (2,054 | ) | (417 | ) | - | - | - | |||||||||||||
| Net Income available to Common Shareholders | $ | 1,745 | $ | (36,181 | ) | $ | 19,228 | $ | 27,214 | $ | 21,593 | |||||||||
| Net Interest Income (FTE) | $ | 64,426 | $ | 68,952 | $ | 72,532 | $ | 71,176 | $ | 60,999 | ||||||||||
| EARNINGS PER SHARE: | ||||||||||||||||||||
| Basic | ||||||||||||||||||||
| Net income | $ | 0.02 | $ | (0.45 | ) | $ | 0.24 | $ | 0.34 | $ | 0.33 | |||||||||
| Diluted | ||||||||||||||||||||
| Net income | $ | 0.02 | $ | (0.45 | ) | $ | 0.23 | $ | 0.34 | $ | 0.33 | |||||||||
| Average Shares Basic | 81,497,806 | 79,341,618 | 79,741,702 | 79,514,136 | 65,190,940 | |||||||||||||||
| Average Shares Diluted | 81,891,272 | 79,341,618 | 80,495,907 | 80,626,387 | 65,899,893 | |||||||||||||||
| SUPPLEMENTAL DATA ($000s) | ||||||||||||||||||||
| Return on Avg. Assets (annualized) | 0.16 | % | -1.53 | % | 0.83 | % | 1.20 | % | 1.10 | % | ||||||||||
| Return on Avg.Total Equity (annualized) | 1.31 | % | -13.20 | % | 7.29 | % | 10.42 | % | 10.54 | % | ||||||||||
| Return on Avg. Common Equity (annualized) | 1.49 | % | -13.61 | % | 7.29 | % | 10.42 | % | 10.54 | % | ||||||||||
| Return on Avg. Total Tangible Equity (annualized) | 2.64 | % | -28.83 | % | 16.50 | % | 23.69 | % | 21.84 | % | ||||||||||
| Return on Avg. Common Tangible Equity (annualized) | 3.51 | % | -30.86 | % | 16.50 | % | 23.69 | % | 21.84 | % | ||||||||||
10
| Reconciliation Table for Non-GAAP Financial Measures | ||||||||||||||||||||
| Return on average total shareholders' equity | 1.31 | % | -13.20 | % | 7.29 | % | 10.42 | % | 10.54 | % | ||||||||||
| Effect of goodwill and intangibles | 1.33 | % | -15.62 | % | 9.21 | % | 13.27 | % | 11.30 | % | ||||||||||
| Return on average total tangible equity | 2.64 | % | -28.83 | % | 16.50 | % | 23.69 | % | 21.84 | % | ||||||||||
| Average total tangible equity excludes acquisition related average goodwill and intangibles: | ||||||||||||||||||||
| Average total shareholders' equity | $ | 1,176,494 | $ | 1,077,773 | $ | 1,049,144 | $ | 1,047,583 | $ | 823,757 | ||||||||||
| Average goodwill and intangibles | (592,816 | ) | (584,221 | ) | (585,544 | ) | (586,729 | ) | (426,039 | ) | ||||||||||
| Average total tangible equity | 583,678 | 493,552 | 463,600 | 460,854 | 397,718 | |||||||||||||||
| Return on average common shareholders' equity | 1.49 | % | -13.61 | % | ||||||||||||||||
| Effect of goodwill and intangibles | 2.02 | % | -17.25 | % | ||||||||||||||||
| Return on average common tangible equity | 3.51 | % | -30.86 | % | ||||||||||||||||
| Average common tangible equity excludes acquisition related average goodwill and intangibles: | ||||||||||||||||||||
| Average common shareholders' equity | $ | 1,031,883 | $ | 1,045,212 | - | - | - | |||||||||||||
| Average goodwill and intangibles | (592,816 | ) | (584,221 | ) | - | - | - | |||||||||||||
| Average common tangible equity | 439,067 | 460,991 | ||||||||||||||||||
11
| Financial Update for NATL PENN BCSHS (NPBC) FOR 3/31/09 | ||||||||||||||||||||
| PAGE: 3 of 5 | ||||||||||||||||||||
| FOR QUARTER | FOR QUARTER | FOR QUARTER | FOR QUARTER | FOR QUARTER | ||||||||||||||||
| ENDED | ENDED | ENDED | ENDED | ENDED | ||||||||||||||||
| CHARGEOFFS ($000s) | 3/31/2009 | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | |||||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||||
| Loan Chargeoffs | $ | 16,044 | $ | 18,946 | $ | 7,097 | $ | 4,508 | $ | 3,001 | ||||||||||
| Recoveries on Loans | (786 | ) | (756 | ) | (2,276 | ) | (808 | ) | (440 | ) | ||||||||||
| Net Loan Chargeoffs | $ | 15,258 | $ | 18,190 | $ | 4,821 | $ | 3,700 | $ | 2,561 | ||||||||||
| Net Loan Chargeoffs to Average Loans (non-annualized) | 0.24 | % | 0.29 | % | 0.08 | % | 0.06 | % | 0.05 | % | ||||||||||
| NET CHARGE OFF ASSETS-DETAIL | ||||||||||||||||||||
| Commercial, Financial and Agricultural | $ | (6,597 | ) | $ | (10,901 | ) | ||||||||||||||
| Real Estate-Permanent | 6 | (378 | ) | |||||||||||||||||
| Real Estate-Construction | (1,234 | ) | (4,103 | ) | ||||||||||||||||
| Leases | (88 | ) | - | |||||||||||||||||
| Residential Mortgages | (565 | ) | (1,534 | ) | ||||||||||||||||
| Consumer | (6,633 | ) | (1,048 | ) | ||||||||||||||||
| Overdraft | (147 | ) | (226 | ) | ||||||||||||||||
| Net Loans Carged-off | $ | (15,258 | ) | $ | (18,190 | ) | ||||||||||||||
| AS OF | AS OF | AS OF | AS OF | AS OF | ||||||||||||||||
| ASSET QUALITY AND OTHER DATA ($000s) | 3/31/2009 | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | |||||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||||
| Nonaccrual Loans | $ | 59,871 | $ | 31,972 | $ | 25,562 | $ | 18,566 | $ | 22,679 | ||||||||||
| Renegotiated Loans | 614 | 623 | 628 | 631 | - | |||||||||||||||
| Other Real Estate Owned & Repossessed Assets | 1,862 | 1,552 | 1,623 | 842 | 326 | |||||||||||||||
| Total Non-performing Assets | $ | 62,347 | $ | 34,147 | $ | 27,813 | $ | 20,039 | $ | 23,005 | ||||||||||
| Loans 90+ Days Past Due & Still Accruing | 2,659 | 2,991 | 2,551 | 2,586 | 1,140 | |||||||||||||||
| Non-performing + Loans 90 Days Past Due | $ | 65,006 | $ | 37,138 | $ | 30,364 | $ | 22,625 | $ | 24,145 | ||||||||||
| Allowance for Loan and Lease Losses | $ | 86,273 | $ | 84,006 | $ | 83,696 | $ | 81,642 | $ | 81,631 | ||||||||||
| Coverage Ratio | 132.7 | % | 226.2 | % | 275.6 | % | 360.8 | % | 338.1 | % | ||||||||||
| NON PERFORMING ASSETS-DETAIL | ||||||||||||||||||||
| Commercial, Financial and Agricultural | $ | 26,479 | $ | 11,657 | ||||||||||||||||
| Real Estate-Permanent | 2,327 | 1,730 | ||||||||||||||||||
| Real Estate-Construction | 18,357 | 10,884 | ||||||||||||||||||
| Leases | 789 | 600 | ||||||||||||||||||
| Residential Mortgages | 6,155 | 3,950 | ||||||||||||||||||
| Consumer | 7,402 | 4,557 | ||||||||||||||||||
| Loans Past Due 90+Days | 2,659 | 2,991 | ||||||||||||||||||
| Total Other Repossessed Assets | 838 | 769 | ||||||||||||||||||
| Total Non-performing Assets + Loans 90 Days Past Due | $ | 65,006 | $ | 37,138 | ||||||||||||||||
| AS OF | AS OF | AS OF | AS OF | AS OF | ||||||||||||||||
| REGULATORY CAPITAL DATA ($000s) | 3/31/2009 | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | |||||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||||
| Tier 1 Capital | $ | 764,426 | $ | 741,622 | $ | 644,185 | $ | 642,223 | $ | 622,391 | ||||||||||
| Tier 1 Ratio (%) | 10.44 | % | 10.65 | % | 9.34 | % | 9.39 | % | 9.11 | % | ||||||||||
| Total Capital (Tier 1 + Tier 2) | $ | 854,019 | $ | 825,628 | $ | 728,068 | $ | 723,865 | $ | 704,087 | ||||||||||
| Total Capital Ratio (%) | 11.61 | % | 11.85 | % | 10.56 | % | 10.59 | % | 10.31 | % | ||||||||||
| Total Risk-Adjusted Assets | $ | 7,324,455 | $ | 6,965,197 | $ | 6,897,519 | $ | 6,837,963 | $ | 6,829,295 | ||||||||||
| Tier 1 Leverage Ratio | 8.62 | % | 8.50 | % | 7.43 | % | 7.60 | % | 8.50 | % | ||||||||||
| Tangible Common Equity to Tangible Assets | 4.87 | % | 5.00 | % | 5.28 | % | 5.32 | % | 5.38 | % | ||||||||||
| Tangible Equity to Tangible Assets Ratio | 6.46 | % | 6.84 | % | 5.28 | % | 5.32 | % | 5.38 | % | ||||||||||
12
| Financial Update for NATL PENN BCSHS (NPBC) FOR 3/31/09 | ||||||||||||||||||||
| PAGE: 4 of 5 | AS OF | AS OF | AS OF | AS OF | AS OF | |||||||||||||||
| PERIOD END BALANCES: | 3/31/2009 | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | |||||||||||||||
| (unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||||
| Earning Assets / Liabilities | ||||||||||||||||||||
| Loan Breakdown: (Regulatory) | ||||||||||||||||||||
| Commercial/Industrial | $ | 1,182,486 | $ | 1,180,181 | $ | 1,136,007 | $ | 1,117,794 | $ | 1,085,825 | ||||||||||
| Commercial Real Estate | 1,840,278 | 1,808,017 | 1,718,769 | 1,735,011 | 1,609,201 | |||||||||||||||
| Residential Mortgage (including multi-family) | 1,515,548 | 1,526,276 | 1,530,419 | 1,525,791 | 1,594,672 | |||||||||||||||
| Real Estate Construction and Land Development | 617,853 | 588,458 | 582,370 | 549,346 | 537,310 | |||||||||||||||
| Home Equity (revolving and 2nd lien) | 800,304 | 791,975 | 782,061 | 765,108 | 762,717 | |||||||||||||||
| Consumer (Loans to Individuals) | 235,228 | 228,438 | 229,309 | 221,772 | 224,594 | |||||||||||||||
| Other Loans | 173,355 | 192,529 | 215,949 | 205,180 | 185,933 | |||||||||||||||
| Total Loans (net of unearned) | 6,365,052 | 6,315,874 | 6,194,884 | 6,120,002 | 6,000,252 | |||||||||||||||
| Investment Securities | 1,914,039 | 1,919,889 | 1,991,304 | 1,943,438 | 1,941,582 | |||||||||||||||
| Other Earning Assets | 39,622 | 38,946 | 63,117 | 30,686 | 33,520 | |||||||||||||||
| Total Earning Assets (net of loan loss reserve) | $ | 8,232,440 | $ | 8,190,703 | $ | 8,165,609 | $ | 8,012,484 | $ | 7,893,723 | ||||||||||
| Deposit Breakdown: | ||||||||||||||||||||
| Savings | $ | 382,705 | $ | 362,709 | $ | 370,396 | $ | 392,669 | $ | 377,416 | ||||||||||
| NOW Accounts | 967,221 | 1,010,532 | 899,281 | 863,879 | 932,132 | |||||||||||||||
| Money Market Accounts | 1,719,492 | 1,591,131 | 1,640,901 | 1,716,021 | 1,679,063 | |||||||||||||||
| CDs $100m or less | 1,730,061 | 1,760,030 | 1,673,683 | 1,539,392 | 1,722,316 | |||||||||||||||
| CDs greater than $100m | 1,129,941 | 872,216 | 853,560 | 773,669 | 624,488 | |||||||||||||||
| Total Int. Bearing Deposits | 5,929,420 | 5,596,618 | 5,437,821 | 5,285,630 | 5,335,415 | |||||||||||||||
| Short-Term Borrowings | 653,805 | 651,307 | 859,415 | 823,245 | 678,581 | |||||||||||||||
| Long-Term Debt | 1,060,666 | 1,083,963 | 1,114,020 | 1,173,678 | 1,161,403 | |||||||||||||||
| Total Int. Bearing Liabilities | $ | 7,643,891 | $ | 7,331,888 | $ | 7,411,256 | $ | 7,282,553 | $ | 7,175,399 | ||||||||||
| Loan Breakdown: (Internal) | ||||||||||||||||||||
| Commercial Real Estate | ||||||||||||||||||||
| Non Owner Occupied | ||||||||||||||||||||
| - Permanent | $ | 782,840 | $ | 770,663 | $ | 707,272 | $ | 734,907 | $ | 716,827 | ||||||||||
| - Construction / Development | 494,224 | 453,462 | 439,877 | 414,983 | 412,422 | |||||||||||||||
| Owner Occupied | ||||||||||||||||||||
| - Permanent | 582,611 | 553,720 | 548,948 | 572,659 | 557,279 | |||||||||||||||
| - Construction / Development | 46,036 | 40,952 | 42,188 | 35,200 | 37,804 | |||||||||||||||
| Commercial & Industrial | ||||||||||||||||||||
| Business Purpose, Real Estate secured | 1,151,668 | 1,145,264 | 1,299,758 | 1,234,793 | 1,142,600 | |||||||||||||||
| Business Purpose, not secured by Real Estate | 1,292,103 | 1,319,571 | 1,136,007 | 1,117,794 | 1,085,825 | |||||||||||||||
| Residential Mortgage (personal purpose) | ||||||||||||||||||||
| Perm | 1,023,444 | 1,037,953 | 1,043,557 | 1,035,874 | 1,023,358 | |||||||||||||||
| Construction | 17,583 | 19,073 | 17,600 | 20,667 | 46,285 | |||||||||||||||
| Retail | ||||||||||||||||||||
| Home Equity Loans | 543,999 | 583,693 | 600,210 | 608,077 | 642,154 | |||||||||||||||
| Home Equity Lines of Credit | 239,794 | 212,468 | 177,514 | 162,599 | 149,406 | |||||||||||||||
| Other | 190,750 | 179,055 | 181,953 | 182,449 | 186,292 | |||||||||||||||
| Total Loans | $ | 6,365,052 | $ | 6,315,874 | $ | 6,194,884 | $ | 6,120,002 | $ | 6,000,252 | ||||||||||
13
| Financial Update for NATL PENN BCSHS (NPBC) FOR 3/31/09 | ||||||||||||||||||||||||||||||||||||||||
| PAGE 5 OF 5 | ||||||||||||||||||||||||||||||||||||||||
| BALANCE AND YIELD/COST ANALYSIS: | AS OF | AS OF | AS OF | AS OF | AS OF | |||||||||||||||||||||||||||||||||||
| 3/31/2009 | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | ||||||||||||||||||||||||||||||||||||
| (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 | |||||||||||||||||||||||||||||||
| Total Loans (net of unearned) | $ | 6,366,859 | 5.47 | % | $ | 6,267,958 | 6.10 | % | $ | 6,159,589 | 6.33 | % | $ | 6,027,845 | 6.45 | % | $ | 5,296,371 | 6.80 | % | ||||||||||||||||||||
| Investment Securities (incl. trading assets) | 1,946,768 | 5.39 | % | 1,953,569 | 5.16 | % | 2,000,340 | 5.61 | % | 1,920,200 | 5.46 | % | 1,802,951 | 5.63 | % | |||||||||||||||||||||||||
| Other Earning Assets | 36,666 | 0.24 | % | 26,811 | 0.83 | % | 26,058 | 1.04 | % | 26,752 | 5.58 | % | 24,148 | 2.22 | % | |||||||||||||||||||||||||
| Total Earning Assets | 8,350,293 | 5.43 | % | 8,248,338 | 5.86 | % | 8,185,987 | 6.14 | % | 7,974,797 | 6.21 | % | 7,123,470 | 6.49 | % | |||||||||||||||||||||||||
| Total Earning Assets (net of loan loss reserve) | 8,261,145 | 5.49 | % | 8,163,407 | 5.92 | % | 8,102,336 | 6.20 | % | 7,892,174 | 6.27 | % | 7,051,565 | 6.56 | % | |||||||||||||||||||||||||
| Total Assets | 9,461,229 | 4.79 | % | 9,312,607 | 5.19 | % | 9,258,341 | 5.43 | % | 9,037,448 | 5.48 | % | 7,886,342 | 5.86 | % | |||||||||||||||||||||||||
| Savings | 370,302 | 0.35 | % | 365,925 | 0.47 | % | 385,964 | 0.53 | % | 379,866 | 0.53 | % | 316,680 | 0.71 | % | |||||||||||||||||||||||||
| NOW Accounts | 973,386 | 0.83 | % | 973,959 | 1.18 | % | 883,993 | 1.09 | % | 898,257 | 1.19 | % | 843,526 | 1.79 | % | |||||||||||||||||||||||||
| Money Market Accounts | 1,672,706 | 1.63 | % | 1,592,120 | 2.14 | % | 1,688,004 | 2.29 | % | 1,649,955 | 2.27 | % | 1,416,426 | 2.78 | % | |||||||||||||||||||||||||
| Certificates | 2,722,419 | 3.37 | % | 2,594,983 | 3.50 | % | 2,449,391 | 3.75 | % | 2,324,339 | 3.95 | % | 2,097,691 | 4.32 | % | |||||||||||||||||||||||||
| Total Int. Bearing Deposits | 5,738,813 | 2.24 | % | 5,526,987 | 2.50 | % | 5,407,352 | 2.63 | % | 5,252,417 | 2.70 | % | 4,674,323 | 3.16 | % | |||||||||||||||||||||||||
| Non-Interest Bearing Deposits | 709,490 | 762,598 | 758,990 | 753,052 | 649,278 | |||||||||||||||||||||||||||||||||||
| Total Deposits | 6,448,303 | 1.99 | % | 6,289,585 | 2.20 | % | 6,166,342 | 2.31 | % | 6,005,469 | 2.36 | % | 5,323,601 | 2.77 | % | |||||||||||||||||||||||||
| Short-Term Borrowings Other Real Estate Owned & Repossessed Assets | 670,436 | 2.19 | % | 766,184 | 2.68 | % | 774,760 | 2.67 | % | 720,965 | 2.94 | % | 643,958 | 3.29 | % | |||||||||||||||||||||||||
| Long-Term Borrowings | 1,072,044 | 4.56 | % | 1,105,217 | 4.53 | % | 1,165,047 | 4.37 | % | 1,149,476 | 4.22 | % | 1,049,870 | 4.61 | % | |||||||||||||||||||||||||
| Total Int. Bearing Liabilities (incl. non-int bearing deposits) | 8,190,783 | 2.34 | % | 8,160,986 | 2.56 | % | 8,106,149 | 2.64 | % | 7,875,910 | 2.69 | % | 7,017,429 | 3.09 | % | |||||||||||||||||||||||||
| Total Int. Bearing Liabilities | 7,481,293 | 2.57 | % | 7,398,388 | 2.82 | % | 7,347,159 | 2.91 | % | 7,122,858 | 2.97 | % | 6,368,151 | 3.41 | % | |||||||||||||||||||||||||
| Net Yield on Earning Assets (net of loan loss reserve): (Margin) | 3.16 | % | 3.36 | % | 3.56 | % | 3.59 | % | 3.48 | % | ||||||||||||||||||||||||||||||
| Net Yield on Earning Assets: (Margin) | 3.13 | % | 3.33 | % | 3.52 | % | 3.55 | % | 3.44 | % | ||||||||||||||||||||||||||||||
14
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 | 124 | 124 | 124 | 132 | |||||||||||||||||||
| Total Number of Insured Subsidiaries (Bank & Thrift Subsidiaries) | 1 | 1 | 1 | 1 | 1 | |||||||||||||||||||
| Total Number of ATMs | 138 | 138 | 142 | 145 | 152 | |||||||||||||||||||
| 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 | 2 | 2 | 2 | |||||||||||||||||||
| Total Number of Insured Subsidiaries (Bank & Thrift Subsidiaries) | 1 | 1 | 1 | 1 | 1 | |||||||||||||||||||
| Total Number of ATMs | 2 | 2 | 2 | 1 | 1 | |||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||
| Total Number of Banking Offices | 127 | 127 | 127 | 127 | 135 | |||||||||||||||||||
| Total Number of Insured Subsidiaries (Bank & Thrift Subsidiaries) | 2 | 2 | 2 | 2 | 2 | |||||||||||||||||||
| Total Number of ATMs | 141 | 141 | 145 | 147 | 154 | |||||||||||||||||||
| EOP Employees (Full Time Equivalent) | 1,785 | 1,780 | 1,768 | 1,816 | 1,906 | |||||||||||||||||||
| Wealth Assets: | ||||||||||||||||||||||||
| Assets under administration | 7,851,843 | 7,912,771 | 8,315,474 | 8,521,540 | 8,150,443 | |||||||||||||||||||
| Assets under management (included above) | 2,280,512 | 2,414,271 | 2,663,259 | 2,815,813 | 2,931,374 | |||||||||||||||||||
15