From the Wires
National Penn Bancshares, Inc. Reports Third Quarter Net Income and Increased Cash Dividend
Oct. 23, 2008 09:29 AM
BOYERTOWN, Pa., Oct. 23 /PRNewswire-FirstCall/ -- National Penn
Bancshares, Inc. (Nasdaq: NPBC) reported third quarter 2008 net income
totaling $19.23 million, or $0.23 per diluted share. Net income increased
approximately 14.4% over the $16.81 million earned in the third quarter of
2007. Third quarter 2008 net income was adversely impacted by an after-tax
unrealized loss of $13.00 million resulting from an other-than-temporary
impairment charge on our entire investment in a synthetic collateralized debt
obligation and was positively affected by an after-tax fair market value
unrealized gain of $4.97 million in NPB Capital Trust II Preferred Securities.
Excluding these adjustments, core third quarter 2008 net income remained solid
at $27.26 million, or $0.34 per diluted share. Diluted earnings per share was
$0.34 in the third quarter of 2007. Additional contributors to the increase
in 3rd quarter 2008 net income include the operations of Christiana Bank &
Trust and KNBT Bancorp, each acquired in first quarter 2008.
For the nine months ended September 30, 2008, National Penn earned $68.04
million of net income compared to $48.52 million for the same period in 2007.
Diluted earnings per share for the nine month periods ended September 30 are
$0.90 for 2008 and $0.97 for 2007. Year-to-date 2008, annualized returns on
average assets and average shareholders' equity were 1.04% and 9.34%,
respectively. For the first nine months of 2007, the annualized returns on
average assets and average shareholders' equity were 1.17% and 11.94%,
respectively.
As of September 30, 2008, National Penn's total assets were $9.32 billion
and total deposits were $6.22 billion. The allowance for loan and lease losses
as of September 30, 2008 was $83.70 million, which represented 1.35% of total
loans and leases outstanding of $6.21 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 9.34% and 10.56% respectively, are in excess of well
capitalized minimum requirements of 6.00% and 10.00%, respectively, and are in
line with second quarter 2008 ratios.
At its regularly scheduled meeting yesterday, National Penn's Board of
Directors took the following actions:
-- Declared an increased fourth quarter cash dividend of $0.1725 per share
payable November 17, 2008 to shareholders of record at the close of business
on November 1, 2008.
-- Following a review of the U.S. Treasury's Capital Purchase Program,
authorized management to complete due diligence and, if satisfactory, apply
for participation in the Program up to the maximum allowable amount of
approximately $200 million. If approved and funded, this unique source of
cost-effective new capital will further bolster National Penn's balance sheet
and will provide additional resources for the growth opportunities National
Penn is currently seeing in its core markets.
-- Approved enhancements to the Company's Dividend Reinvestment and Stock
Purchase Plan to provide a 10% discount on dividends reinvested as well as for
new cash purchases made under the plan. Optional cash contributions may now
be made in amounts up to $50,000 per month, an increase from the prior monthly
limitation of $10,000.
Commenting on third quarter 2008, Glenn E. Moyer, National Penn president
and chief executive officer, said, "We are really pleased to reward our loyal
shareholders by not only maintaining, but increasing our cash dividend for the
31st consecutive year. National Penn's core earnings remain solid under very
difficult economic and financial market conditions. While we found it
necessary to take a non-cash charge on an investment security, we believe our
overall performance continues to show the financial strength of National Penn.
National Penn continues to actively lend money to and gather deposits from
qualified consumers and businesses. In fact, in the past quarter our loans
have grown $74 million while our deposits increased by $137 million. We
intend to stay active in our mid-Atlantic markets to support the recovery from
the current challenges in our economy."
About National Penn Bancshares, Inc.:
National Penn Bancshares, Inc., with $9.3 billion in assets, is the fifth
largest bank holding company based in Pennsylvania. In addition, wealth
assets under administration or management amount to $8.3 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 FirstService Bank, 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; 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.
Statement Regarding Dividend Reinvestment and Stock Purchase Plan
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of these
securities any state or jurisdiction in which such an offer, solicitation or
sale would be unlawful prior to registration or qualification under the
securities laws of any such state or jurisdiction.
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: participation in the U.S. Treasury's Capital Purchase Program;
ability to obtain new capital and locate growth opportunities; 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;
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 other cautionary
statements that are included in National Penn's Quarterly Report on Form 10-Q
for the fiscal quarter ended June 30, 2008, as well as in other documents
filed by National Penn 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.
FINANCIAL HIGHLIGHTS
Dollars in thousands, except per share data
Three Months Ended September 30,
2008 2007 % Change
EARNINGS
Total interest income 120,717 $85,727 40.8%
Total interest expense 53,769 46,631 15.3%
Net interest income 66,948 39,096 71.2%
Provision for loan and lease losses 6,876 1,420 384.2%
Net interest income after provision
for loan and lease losses 60,072 37,676 59.4%
Other income 16,850 18,250 -7.7%
Other expenses 54,087 34,101 58.6%
Income before income taxes 22,835 21,825 4.6%
Income taxes 3,607 5,018 -28.1%
Net income $19,228 $16,807 14.4%
PERFORMANCE RATIOS
Net yield on earning assets 3.52% 3.35% 5.1%
Return on average assets 0.83% 1.18% -29.7%
Return on average shareholders'
equity 7.29% 12.30% -40.7%
Return on average tangible equity (1) 16.50% 25.29% -34.8%
PER SHARE
Basic earnings $0.24 $0.34 -29.4%
Diluted earnings $0.23 $0.34 -32.4%
Dividends paid in cash $0.1700 $0.1626 4.6%
Average shares - basic 79,741,702 49,146,831 62.3%
Average shares - diluted 80,495,907 49,641,283 62.2%
(1) Reconciliation Table for Non-GAAP Financial Measures
Return on average shareholders'
equity 7.29% 12.30%
Effect of goodwill and intangibles 9.21% 12.99%
Return on average tangible equity 16.50% 25.29%
Average tangible equity excludes
acquisition related average goodwill
and intangibles:
Average shareholders' equity $1,049,144 $542,052
Average goodwill and
intangibles (585,544) (278,441)
Average tangible equity $463,600 $263,611
Net Income $19,228
After tax unrealized fair
market value gain on
NPB Capital Trust II
Preferred Securities (4,967)
After tax other than
temporary impairment
charge on CDO investment 13,000
Core net income $27,261
Diluted earnings per share $0.23
After tax unrealized fair
market value gain on
NPB Capital Trust II
Preferred Securities (0.06)
After tax other than
temporary impairment
charge on CDO investment 0.17
Core diluted earnings per share $0.34
Nine Months Ended September 30,
2008 2007 % Change
STATEMENTS OF CONDITION
Total assets $9,316,795 $5,763,931 61.6%
Investment securities 1,979,577 1,420,413 39.4%
Loans and leases 6,207,621 3,786,801 63.9%
Deposits 6,220,643 3,927,823 58.4%
Short-term borrowings 859,415 452,761 89.8%
Long-term borrowings 1,114,020 769,051 44.9%
Shareholders' equity 1,046,013 554,322 88.7%
Book value per share 13.09 11.28 16.0%
EARNINGS
Total interest income $350,623 $248,971 40.8%
Total interest expense 160,983 133,462 20.6%
Net interest income 189,640 115,509 64.2%
Provision for loan and lease losses 13,997 4,032 247.1%
Net interest income after provision
for loan and lease losses 175,643 111,477 57.6%
Other income 68,962 52,742 30.8%
Other expenses 156,827 101,929 53.9%
Income before income taxes 87,778 62,290 40.9%
Income taxes 19,743 13,766 43.4%
Net income $68,035 $48,524 40.2%
PERFORMANCE RATIOS
Net yield on earning assets 3.52% 3.39% 3.8%
Return on average assets 1.04% 1.17% -11.1%
Return on average shareholders'
equity 9.34% 11.94% -21.8%
Return on average tangible equity (1) 20.62% 24.72% -16.6%
PER SHARE
Basic earnings $0.91 $0.98 -7.1%
Diluted earnings $0.90 $0.97 -7.2%
Dividends paid in cash $0.5100 $0.4878 4.6%
Average shares - basic 74,833,736 49,445,112 51.3%
Average shares - diluted 75,470,534 50,053,803 50.8%
(1) Reconciliation Table for Non-GAAP Financial Measures
Return on average shareholders'
equity 9.34% 11.94%
Effect of goodwill and
intangibles 11.28% 12.78%
Return on average tangible
equity 20.62% 24.72%
Average tangible equity
excludes acquisition related
average goodwill and
intangibles:
Average shareholders' equity $973,495 $543,218
Average goodwill and
intangibles (532,771) (280,795)
Average tangible equity $440,724 $262,423
Financial Update for NATL PENN BCSHS (NPBC) FOR 9/30/08
PAGE: 1 OF 5 AS OF AS OF AS OF
BALANCE SHEET - ASSETS ($000s) 9/30/2008 6/30/2008 3/31/2008
(unaudited) (unaudited) (unaudited)
Cash & Cash Equivalents $152,909 $205,457 $201,655
Held to Maturity Securities 391,725 406,653 271,381
Securities Available for Sale 1,587,852 1,536,785 1,669,200
Total Securities 1,979,577 1,943,438 1,940,581
Total Cash and Securities 2,132,486 2,148,895 2,142,236
Loans & Leases Held for Sale 5,317 5,269 5,711
Loans & Leases Held for Investment 6,202,304 6,128,329 6,007,153
Total Loans and Leases 6,207,621 6,133,598 6,012,864
Loan Loss Reserve (83,696) (81,642) (81,631)
Premises and Equipment, net 106,968 109,305 110,438
Bank Owned Life Insurance 192,594 190,892 189,050
Goodwill 546,270 545,460 545,484
Other Intangibles 38,768 40,173 42,139
Total Intangible Assets 585,038 585,633 587,623
Unconsolidated Investments Under
the Equity Method 11,470 10,985 12,609
Other Real Estate Owned 1,129 842 326
Other Assets 163,185 142,847 134,599
Total Assets $9,316,795 $9,241,355 $9,108,114
BALANCE SHEET - LIABILITIES ($000s)
Interest-bearing Deposits $5,437,824 $5,285,629 $5,335,413
Non-interest bearing Deposits $782,819 $798,088 $768,154
Borrowings 1,838,928 1,854,775 1,698,974
Subordinated Debt (Trust Preferred
Securities) 134,507 142,148 141,009
Other Liabilities 76,704 114,320 118,527
Total Liabilities $8,270,782 $8,194,960 $8,062,077
BALANCE SHEET - EQUITY ($000s)
Common Stock $980,894 $978,546 $975,744
Retained Earnings 115,291 109,602 95,859
Accumulated Other Comprehensive
Income $(50,172) $(41,753) $(25,485)
Treasury Stock - - (81)
Total Shareholders Equity $1,046,013 $1,046,395 $1,046,037
MEMO ITEMS
Accumulated other comprehensive
(loss) income $(50,172) $(41,753) $(25,485)
Book Value Per Share $13.09 $13.15 $13.17
Tangible Book Value Per Share $5.77 $5.78 $5.77
EOP Common Shares Outstanding
(excluding Treasury shares) 79,886,282 79,603,356 79,410,734
Treasury Shares Held By Company - - 5,064
Did you announce a repurchase plan
during this period? NO NO NO
Number of Shares to be Repurchased
in Plans 3,779,456 3,779,456 3,779,456
Number of Shares Repurchased
During Period - - 33,587
Average Price of Repurchased
Shares $- $- $16.38
AS OF AS OF
BALANCE SHEET - ASSETS ($000s) 12/31/2007 9/30/2007
(unaudited) (unaudited)
Cash & Cash Equivalents $111,520 $99,379
Held to Maturity Securities 243,595 244,815
Securities Available for Sale 1,137,426 1,175,598
Total Securities 1,381,021 1,420,413
Total Cash and Securities 1,492,541 1,519,792
Loans & Leases Held for Sale 3,823 2,127
Loans & Leases Held for
Investment 3,871,430 3,784,674
Total Loans and Leases 3,875,253 3,786,801
Loan Loss Reserve (54,897) (56,294)
Premises and Equipment, net 61,214 61,743
Bank Owned Life Insurance 102,407 101,318
Goodwill 261,552 261,161
Other Intangibles 16,160 16,919
Total Intangible Assets 277,712 278,080
Unconsolidated Investments Under
the Equity Method 11,490 10,058
Other Real Estate Owned - 364
Other Assets 58,701 62,069
Total Assets $5,824,421 $5,763,931
BALANCE SHEET - LIABILITIES ($000s)
Interest-bearing Deposits $3,423,447 $3,439,266
Non-interest bearing Deposits $522,716 $488,557
Borrowings 1,114,206 1,080,221
Subordinated Debt (Trust
Preferred Securities) 139,997 141,591
Other Liabilities 60,108 59,974
Total Liabilities $5,260,474 $5,209,609
BALANCE SHEET - EQUITY ($000s)
Common Stock $491,011 $490,872
Retained Earnings 85,242 76,888
Accumulated Other Comprehensive
Income $(4,281) $(6,458)
Treasury Stock (8,025) (6,980)
Total Shareholders Equity $563,947 $554,322
MEMO ITEMS
Accumulated other comprehensive
(loss) income $(4,281) $(6,458)
Book Value Per Share $11.49 $11.28
Tangible Book Value Per Share $5.83 $5.62
EOP Common Shares Outstanding
(excluding Treasury shares) 49,068,819 49,150,514
Treasury Shares Held By Company 544,061 477,117
Did you announce a repurchase
plan during this period? NO NO
Number of Shares to be
Repurchased in Plans 3,779,456 3,779,456
Number of Shares Repurchased
During Period 326,039 594,566
Average Price of Repurchased
Shares $14.76 $14.61
Financial Update for NATL PENN BCSHS (NPBC) FOR 9/30/08
PAGE: 2 OF 5
FOR QUARTER FOR QUARTER FOR QUARTER
ENDED ENDED ENDED
INCOME STATEMENT ($000s) 9/30/2008 6/30/2008 3/31/2008
(unaudited) (unaudited) (unaudited)
Interest Income $120,717 $119,503 $110,403
Interest Expense 53,769 53,225 53,989
Net Interest Income 66,948 66,278 56,414
Loan and Lease Loss Provision 6,876 3,711 3,410
Net Interest Income after
Provision for Loan and
Lease Losses 60,072 62,567 53,004
Wealth Management Income 8,239 8,515 7,608
Service Charges on Deposits 6,880 6,324 5,261
Cash Management and Electronic
Banking Fees 3,917 3,715 2,928
Mortgage Banking Income 882 978 591
Insurance Commissions and Fees 3,913 3,968 3,806
Bank Owned Life Insurance Income 1,702 1,842 1,580
Equity in Unconsolidated
Investments 1,574 810 612
Net gains (losses) from fair
value changes 7,641 (1,139) (1,012)
Net Gains on Investment Securities 276 384 -
Gain on Sale of Building(s) - - -
BOLI Death Benefit Income - - -
Other Non-Interest Income 1,826 2,504 2,837
Non-Recurring Loss, Securities (20,000) - -
Total Non-Interest Income 16,850 27,901 24,211
Salaries, Wages and Employee
Benefits 31,998 31,300 29,227
Net Premises and Equipment
Expense 8,416 9,019 8,007
Foreclosed Property Expense
Amortization of Intangibles 1,981 1,964 1,582
Other Non-Interest Expense 11,692 11,543 10,098
Non-Recurring Expense - - -
Total Non-Interest Expense 54,087 53,826 48,914
Net Income Before Taxes 22,835 36,642 28,301
Income Tax Expense 3,607 9,428 6,708
Net Income 19,228 27,214 21,593
Net Interest Income (FTE) $72,532 $71,176 $60,999
EARNINGS PER SHARE:
Basic
Net income $0.24 $0.34 $0.33
Diluted
Net income $0.23 $0.34 $0.33
Average Shares Basic 79,741,702 79,514,136 65,190,940
Average Shares Diluted 80,495,907 80,626,387 65,899,893
SUPPLEMENTAL DATA ($000s) (2)
Return on Avg. Assets
(annualized) 0.83% 1.20% 1.10%
Return on Avg. Equity (annualized) 7.29% 10.42% 10.54%
Return on Avg. Tangible Equity
(annualized) (1) 16.50% 23.69% 21.84%
Average Tangible Equity to
Tangible Assets (3) 5.35% 5.45% 5.31%
Average Realized Tangible Equity
to Average Tangible Assets
Ratio (4) 5.84% 5.77% 5.38%
(1) (Net income x (365/92)), divided
by (average equity - average goodwill
and intangibles)
(3) Average tangible equity, divided by
(average assets - average goodwill
and intangibles).
(4) (Average tangible equity - average
AOCI), divided by average tangible
assets.
(1) (2) Reconciliation Table for
Non-GAAP Financial Measure
Return on average
shareholders' equity 7.29% 10.42% 10.54%
Effect of goodwill and
intangibles 9.21% 13.27% 11.30%
Return on average tangible
equity 16.50% 23.69% 21.84%
Average tangible equity
excludes acquisition related
average goodwill and
intangibles:
Average shareholders'
equity $1,049,144 $1,047,583 $823,757
Average goodwill and
intangibles (585,544) (586,729) (426,039)
Average tangible equity 463,600 460,854 397,718
FOR QUARTER FOR QUARTER YEAR YEAR
ENDED ENDED TO DATE TO DATE
INCOME STATEMENT ($000s) 12/31/2007 9/30/2007 9/30/2008 9/30/2007
(unaudited) (unaudited) (unaudited) (unaudited)
Interest Income $86,502 $85,727 $350,623 $248,971
Interest Expense 45,991 46,631 160,983 133,462
Net Interest Income 40,511 39,096 189,640 115,509
Loan and Lease Loss
Provision 3,800 1,420 13,997 4,032
Net Interest Income after
Provision for Loan and
Lease Losses 36,711 37,676 175,643 111,477
Wealth Management Income 4,605 4,359 24,362 12,711
Service Charges on Deposits 4,499 4,461 18,465 12,873
Cash Management and Electronic
Banking Fees 2,367 2,241 10,560 6,295
Mortgage Banking Income 512 468 2,451 2,454
Insurance Commissions and
Fees 1,383 1,556 11,687 5,243
Bank Owned Life Insurance
Income 1,089 1,102 5,124 3,279
Equity in Unconsolidated
Investments 2,549 226 2,996 (147)
Net gains (losses) from fair
value changes 1,594 1,188 5,490 1,213
Net Gains on Investment
Securities 331 600 660 1,733
Gain on Sale of Building(s) - 279 - 449
BOLI Death Benefit Income - - - 1,211
Other Non-Interest Income 1,527 1,770 7,167 5,428
Non-Recurring Loss,
Securities - - (20,000) -
Total Non-Interest Income 20,456 18,250 68,962 52,742
Salaries, Wages and Employee
Benefits 22,337 20,982 92,525 62,038
Net Premises and Equipment
Expense 5,016 4,867 25,442 14,786
Amortization of Intangibles 758 758 5,527 2,276
Other Non-Interest Expense 8,733 7,494 33,333 22,829
Non-Recurring Expense - - - -
Total Non-Interest Expense 36,844 34,101 156,827 101,929
Net Income Before Taxes 20,323 21,825 87,778 62,290
Income Tax Expense 3,614 5,018 19,743 13,766
Net Income 16,709 16,807 68,035 48,524
Net Interest Income (FTE) $44,883 $43,260 $204,707 $127,101
EARNINGS PER SHARE:
Basic
Net income $0.34 $0.34 $ 0.91 $0.98
Diluted
Net income $0.34 $0.34 $ 0.90 $0.97
Average Shares Basic 49,044,107 49,146,831 74,833,736 49,445,112
Average Shares Diluted 49,496,144 49,641,283 75,470,534 50,053,803
SUPPLEMENTAL DATA ($000s) (2)
Return on Avg. Assets
(annualized) 1.15% 1.18% 1.04% 1.17%
Return on Avg. Equity
(annualized) 11.96% 12.30% 9.34% 11.94%
Return on Avg. Tangible
Equity (annualized) (1) 23.96% 25.29% 20.62% 24.72%
Average Tangible Equity to
Tangible Assets (3) 5.04% 4.90% 5.38% 4.98%
Average Realized Tangible
Equity to Average Tangible
Assets Ratio (4) 5.14% 5.10% 5.69% 5.06%
(1) (Net income x (365/92)),
divided by (average equity
- average goodwill and
intangibles)
(3) Average tangible equity,
divided by (average assets
- average goodwill and
intangibles).
(4) (Average tangible equity -
average AOCI), divided by
average tangible assets.
(1) (2) Reconciliation Table for
Non-GAAP Financial
Measure Return on
average shareholders'
equity 11.96% 12.30% 9.34% 11.94%
Effect of goodwill
and intangibles 12.00% 12.99% 11.28% 12.78%
Return on average
tangible equity 23.96% 25.29% 20.62% 24.72%
Average tangible equity
excludes acquisition
related average goodwill
and intangibles:
Average shareholders'
equity $554,334 $542,052 $973,495 $543,218
Average goodwill and
intangibles (277,691) (278,441) (532,771) (280,795)
Average tangible
equity 276,643 263,611 440,724 262,423
Financial Update for NATL PENN BCSHS (NPBC) FOR 9/30/08
PAGE: 3 OF 5
FOR QUARTER FOR QUARTER FOR QUARTER
ENDED ENDED ENDED
CHARGEOFFS ($000s) 9/30/2008 6/30/2008 3/31/2008
(unaudited) (unaudited) (unaudited)
Loan Chargeoffs $7,097 $4,508 $3,001
Recoveries on Loans (2,276) (808) (440)
Net Loan Chargeoffs $4,821 $3,700 $2,561
Net Loan Chargeoffs to Average
Loans (non-annualized) 0.08% 0.06% 0.05%
AS OF AS OF AS OF
ASSET QUALITY AND OTHER DATA ($000s) 9/30/2008 6/30/2008 3/31/2008
(unaudited) (unaudited) (unaudited)
Nonaccrual Loans $25,562 $18,566 $22,679
Renegotiated Loans 628 631 -
Other Real Estate Owned & Repossessed
Assets 1,623 842 326
Total Non-performing Assets $27,813 $20,039 $23,005
Loans 90+ Days Past Due & Still
Accruing 2,551 2,586 1,140
Non-performing + Loans 90 Days
Past Due $30,364 $22,625 $24,145
Allowance for Loan and Lease
Losses $83,696 $81,642 $81,631
Coverage Ratio 275.6% 360.8% 338.1%
AS OF AS OF AS OF
REGULATORY CAPITAL DATA ($000s) 9/30/2008 6/30/2008 3/31/2008
(unaudited) (unaudited) (unaudited)
Tier 1 Capital $644,185 $642,223 $622,391
Tier 1 Ratio (%) 9.34% 9.39% 9.11%
Total Capital (Tier 1 + Tier 2) $728,068 $723,865 $704,087
Total Capital Ratio (%) 10.56% 10.59% 10.31%
Total Risk-Adjusted Assets $6,897,519 $6,837,963 $6,829,295
Tier 1 Leverage Ratio 7.43% 7.60% 8.50%
Tangible Equity to Tangible Assets
Ratio 5.28% 5.32% 5.38%
Realized Tangible Equity to
Tangible Assets Ratio 5.85% 5.81% 5.68%
AS OF AS OF AS OF
SUPPLEMENTAL DATA ($000s) 9/30/2008 6/30/2008 3/31/2008
(unaudited) (unaudited) (unaudited)
Held to Maturity Securities (Fair
Value) $305,164 $371,788 $269,382
Common Stock Dividends (total $ in
period) $13,541 $13,509 $8,825
Dividends per Common Share $0.1700 $0.1700 $0.1700
EOP Employees (Full Time
Equivalent) 1,768 1,816 1,906
FOR QUARTER FOR QUARTER
ENDED ENDED
CHARGEOFFS ($000s) 12/31/2007 9/30/2007
(unaudited) (unaudited)
Loan Chargeoffs $5,624 $2,482
Recoveries on Loans (428) (352)
Net Loan Chargeoffs $5,196 $2,130
Net Loan Chargeoffs to Average
Loans (non-annualized) 0.14% 0.06%
Financial Update for NATL PENN BCSHS (NPBC) FOR 9/30/08
PAGE: 4 OF 5
AS OF AS OF
ASSET QUALITY AND OTHER DATA ($000s) 12/31/2007 9/30/2007
(unaudited) (unaudited)
Nonaccrual Loans $15,198 $8,435
Renegotiated Loans - -
Other Real Estate Owned &
Repossessed Assets - 364
Total Non-performing Assets $15,198 $8,799
Loans 90+ Days Past Due & Still
Accruing 87 67
Non-performing + Loans 90 Days
Past Due $15,285 $8,866
Allowance for Loan and Lease
Losses $54,897 $56,294
Coverage Ratio 359.2% 634.9%
AS OF AS OF
REGULATORY CAPITAL DATA ($000s) 12/31/2007 9/30/2007
(unaudited) (unaudited)
Tier 1 Capital $426,236 $420,014
Tier 1 Ratio (%) 9.54% 9.64%
Total Capital (Tier 1 + Tier 2) $482,692 $475,596
Total Capital Ratio (%) 10.81% 10.91%
Total Risk-Adjusted Assets $4,466,824 $4,358,884
Tier 1 Leverage Ratio 7.76% 7.80%
Tangible Equity to Tangible
Assets Ratio 5.16% 5.04%
Realized Tangible Equity to
Tangible Assets Ratio 5.24% 5.15%
AS OF AS OF
SUPPLEMENTAL DATA ($000s) 12/31/2007 9/30/2007
(unaudited) (unaudited)
Held to Maturity Securities (Fair
Value) $243,218 $243,593
Common Stock Dividends (total $
in period) $8,354 $8,066
Dividends per Common Share $0.1700 $0.1626
EOP Employees (Full Time
Equivalent) 1,171 1,185
YEAR YEAR
TO DATE TO DATE
CHARGEOFFS ($000s) 9/30/2008 9/30/2007
(unaudited) (unaudited)
Loan Chargeoffs $14,606 $7,427
Recoveries on Loans (3,524) (1,382)
Net Loan Chargeoffs $11,082 $6,045
Net Loan Chargeoffs to Average Loans
(non-annualized) 0.19% 0.16%
AS OF AS OF AS OF
PERIOD END BALANCES: 9/30/2008 6/30/2008 3/31/2008
(unaudited) (unaudited) (unaudited)
Earning Assets / Liabilities
Loan Breakdown: (Regulatory)
Commercial/Industrial $1,148,744 $1,131,389 $1,098,437
Commercial Real Estate 1,718,769 1,735,011 1,609,201
Residential Mortgage (including
multi-family) 1,530,419 1,525,791 1,594,672
Real Estate Construction and Land
Development 582,370 549,346 537,310
Home Equity (revolving and 2nd
lien) 782,061 765,108 762,717
Consumer (Loans to Individuals) 229,309 221,772 224,594
Other Loans 215,949 205,180 185,933
Total Loans (net of unearned) 6,207,621 6,133,597 6,012,864
Investment Securities 1,991,304 1,943,438 1,941,582
Other Earning Assets 63,117 30,686 33,520
Total Earning Assets (net of loan
loss reserve) $8,178,346 $8,026,080 $7,906,335
Deposit Breakdown:
Savings $370,396 $392,669 $377,416
NOW Accounts 899,281 863,879 932,132
Money Market Accounts 1,640,901 1,716,021 1,679,063
CDs $100m or less 1,673,683 1,539,392 1,722,316
CDs greater than $100m 853,560 773,669 624,488
Total Int. Bearing Deposits 5,437,821 5,285,630 5,335,415
Short-Term Borrowings 859,415 823,245 678,581
Long-Term Debt 1,114,020 1,173,678 1,161,403
Total Int. Bearing Liabilities $7,411,256 $7,282,553 $7,175,399
Loan Breakdown: (Internal)
Commercial Real Estate
Non Owner Occupied
- Permanent $707,272 $734,907 $716,827
- Construction / Development 439,877 414,983 412,422
Owner Occupied
- Permanent 548,948 572,659 557,279
- Construction / Development 42,188 35,200 37,804
Commercial & Industrial
Business Purpose, Real Estate
secured 1,299,758 1,234,793 1,142,600
Business Purpose, not secured
by Real Estate 1,148,744 1,131,389 1,098,437
Residential Mortgage (personal
purpose)
Perm 1,043,557 1,035,874 1,023,358
Construction 17,600 20,667 46,285
Retail
Home Equity Loans 600,210 608,077 642,154
Home Equity Lines of Credit 177,514 162,599 149,406
Other 181,953 182,449 186,292
Total Loans $6,207,621 $6,133,597 $6,012,864
AS OF AS OF
PERIOD END BALANCES: 12/31/2007 9/30/2007
(unaudited) (unaudited)
Earning Assets / Liabilities
Loan Breakdown: (Regulatory)
Commercial/Industrial $723,144 $713,887
Commercial Real Estate 1,329,482 1,304,911
Residential Mortgage (including
multi-family) 795,151 781,087
Real Estate Construction and Land
Development 328,720 310,372
Home Equity (revolving and 2nd
lien) 464,673 447,130
Consumer (Loans to Individuals) 73,494 70,817
Other Loans 160,589 158,597
Total Loans (net of unearned) 3,875,253 3,786,801
Investment Securities 1,381,021 1,420,413
Other Earning Assets 7,228 5,616
Total Earning Assets (net of loan
loss reserve) $5,208,604 $5,156,536
Deposit Breakdown:
Savings $193,938 $193,232
NOW Accounts 733,242 775,385
Money Market Accounts 957,423 951,104
CDs $100m or less 992,741 1,008,792
CDs greater than $100m 546,103 510,753
Total Int. Bearing Deposits 3,423,447 3,439,266
Short-Term Borrowings 497,023 452,761
Long-Term Debt 757,180 769,051
Total Int. Bearing Liabilities $4,677,650 $4,661,078
Financial Update for NATL PENN BCSHS (NPBC) FOR 9/30/08
PAGE: 5 OF 5
BALANCE AND YIELD/COST ANALYSIS:
AS OF AS OF AS OF
9/30/2008 6/30/2008 3/31/2008
(unaudited) (unaudited) (unaudited)
Qtr Avg Bal Yield Qtr Avg Bal Yield Qtr Avg Bal Yield
Total Loans
(net of
unearned) $6,159,589 6.33% $6,027,845 6.45% $5,296,371 6.80%
Investment
Securities
(incl.
trading
assets) 2,000,340 5.61% 1,920,200 5.46% 1,802,951 5.63%
Other Earning
Assets 26,058 1.04% 26,752 5.58% 24,148 2.22%
Total Earning
Assets 8,185,987 6.14% 7,974,797 6.21% 7,123,470 6.49%
Total Earning
Assets (net
of loan loss
reserve) 8,102,336 6.20% 7,892,174 6.27% 7,051,565 6.56%
Total Assets 9,258,341 5.43% 9,037,448 5.48% 7,886,342 5.86%
Savings 385,964 0.53% 379,866 0.53% 316,680 0.71%
NOW Accounts 883,993 1.09% 898,257 1.19% 843,526 1.79%
Money Market
Accounts 1,688,004 2.29% 1,649,955 2.27% 1,416,426 2.78%
Certificates 2,449,391 3.75% 2,324,339 3.95% 2,097,691 4.32%
Total Int.
Bearing
Deposits 5,407,352 2.63% 5,252,417 2.70% 4,674,323 3.16%
Non-Interest
Bearing
Deposits 758,990 753,052 649,278
Total Deposits 6,166,342 2.31% 6,005,469 2.36% 5,323,601 2.77%
Short-Term
Borrowings 774,760 2.67% 720,965 2.94% 643,958 3.29%
Long-Term
Borrowings 1,165,047 4.37% 1,149,476 4.22% 1,049,870 4.61%
Total Int.
Bearing
Liabilities
(incl. non-int
bearing
deposits) 8,106,149 2.64% 7,875,910 2.69% 7,017,429 3.09%
Total Int.
Bearing
Liabilities 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) 3.56% 3.59% 3.48%
Net Yield on
Earning Assets:
(Margin) 3.52% 3.55% 3.44%
STATES OF OPERATION AND BANKING OFFICES BY STATE (LATEST AVAILABLE DATA)
Number of Full Service Banking Offices
State (Domestic and in the U.S. Territories)
PA
Total Number of
Banking Offices 124 124 132
Total Number of
Insured
Subsidiaries
(Bank & Thrift
Subsidiaries) 1 1 1
Total Number of ATMs 143 145 152
MD
Total Number of
Banking Offices 1 1 1
Total Number of
Insured
Subsidiaries
(Bank & Thrift
Subsidiaries) 0 0 0
Total Number of ATMs 1 1 1
DE
Total Number of
Banking Offices 2 2 2
Total Number of
Insured
Subsidiaries
(Bank & Thrift
Subsidiaries) 1 1 1
Total Number of ATMs 2 1 1
TOTAL
Total Number of
Banking Offices 127 127 135
Total Number of
Insured
Subsidiaries
(Bank & Thrift
Subsidiaries) 2 2 2
Total Number of ATMs 146 147 154
BALANCE AND YIELD/COST ANALYSIS:
AS OF AS OF
12/31/2007 9/30/2007
(unaudited) (unaudited)
Qtr Avg Bal Yield Qtr Avg Bal Yield
Total Loans (net of
unearned) $3,825,406 7.24% $3,756,081 7.40%
Investment Securities
(incl. trading
assets) 1,393,393 5.98% 1,356,853 5.78%
Other Earning Assets 10,550 3.35% 4,656 4.60%
Total Earning Assets 5,229,349 6.89% 5,117,590 6.97%
Total Earning Assets
(net of loan loss
reserve) 5,172,622 6.97% 5,060,766 7.05%
Total Assets 5,768,409 6.25% 5,661,055 6.30%
Savings 193,088 1.08% 200,665 1.11%
NOW Accounts 766,446 2.65% 734,140 2.67%
Money Market Accounts 961,975 3.38% 965,630 3.65%
Certificates 1,512,883 4.70% 1,457,016 4.76%
Total Int. Bearing
Deposits 3,434,392 3.67% 3,357,451 3.77%
Non-Interest Bearing
Deposits 493,152 499,398
Total Deposits 3,927,544 3.21% 3,856,849 3.28%
Short-Term Borrowings 463,461 3.82% 437,019 4.03%
Long-Term Borrowings 758,929 5.10% 770,371 5.31%
Total Int. Bearing
Liabilities (incl.
non-int bearing
deposits) 5,149,934 3.54% 5,064,239 3.65%
Total Int. Bearing
Liabilities 4,656,782 3.92% 4,564,841 4.05%
Net Yield on Earning
Assets (net of loan
loss reserve): (Margin) 3.44% 3.39%
Net Yield on Earning
Assets: (Margin) 3.41% 3.35%
STATES OF OPERATION AND BANKING OFFICES BY STATE (LATEST AVAILABLE DATA)
Number of Full Service Banking Offices
State (Domestic and in the U.S. Territories)
PA
Total Number of
Banking Offices 81 81
Total Number of Insured
Subsidiaries (Bank &
Thrift Subsidiaries) 1 1
Total Number of ATMs 81 83
MD
Total Number of
Banking Offices 1 1
Total Number of Insured
Subsidiaries (Bank &
Thrift Subsidiaries) 0 0
Total Number of ATMs 1 1
DE
Total Number of Banking
Offices 0 0
Total Number of Insured
Subsidiaries (Bank &
Thrift Subsidiaries) 0 0
Total Number of ATMs 1 0
TOTAL
Total Number of Banking
Offices 82 82
Total Number of Insured
Subsidiaries (Bank &
Thrift Subsidiaries) 1 1
Total Number of ATMs 83 84
BALANCE AND YIELD/COST ANALYSIS:
YTD YTD
9/30/2008 9/30/2007
(unaudited) (unaudited)
YTD Avg Bal Yield YTD Avg Bal Yield
Total Loans (net
of unearned) $5,829,145 6.54% $3,698,998 7.37%
Investment
Securities (incl.
trading assets) 1,908,169 5.59% 1,310,588 5.77%
Other Earning Assets 24,345 3.16% 7,103 3.14%
Total Earning Assets 7,761,659 6.29% 5,016,689 6.94%
Total Earning Assets
(net of loan loss
reserve) 7,682,250 6.36% 4,958,921 7.03%
Total Assets 8,728,004 5.60% 5,552,550 6.27%
Savings 360,929 0.59% 209,747 1.13%
NOW Accounts 875,290 1.35% 683,386 2.51%
Money Market Accounts 1,583,864 2.44% 950,094 3.66%
Certificates 2,291,054 4.01% 1,456,975 4.73%
Total Int. Bearing
Deposits 5,111,137 2.83% 3,300,202 3.73%
Non-Interest Bearing
Deposits 720,580 495,924
Total Deposits 5,831,717 2.48% 3,796,126 3.25%
Short-Term Borrowings 713,452 2.96% 478,797 4.15%
Long-Term Borrowings 1,121,623 4.41% 677,227 5.22%
Total Int. Bearing
Liabilities (incl.
non-int bearing
deposits) 7,666,792 2.80% 4,952,150 3.60%
Total Int. Bearing
Liabilities 6,946,212 3.10% 4,456,226 4.00%
Net Yield on Earning
Assets (net of loan
loss reserve): (Margin) 3.56% 3.43%
Net Yield on Earning
Assets: (Margin) 3.52% 3.39%
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:
SOURCE National Penn Bancshares, Inc.
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