National Penn Bancshares, Inc. Reports Third Quarter 2013 Results

National Penn Bancshares, Inc. (Nasdaq: NPBC) reported net income of $24.6 million, or $0.17 per diluted share, for the third quarter of 2013, compared to $25.0 million, or $0.17 per diluted share for the second quarter of 2013. Year-to-date 2013 adjusted net income 1 was $0.50 per diluted share, exclusive of the first quarter 2013 debt extinguishment and retail trust preferred redemption, compared to net income of $0.49 per diluted share, for the prior year period. Adjusted return on average assets 1 was 1.17% for the third quarter and year-to-date 2013.

“This quarter is indicative of our ongoing commitment to consistent results at a high level, despite the sluggish economy and difficult rate environment,” said Scott V. Fainor, president and CEO of National Penn. “Our team remains focused on prudently managing and positioning the Company to maximize longer-term shareholder value.”

Management’s recent and ongoing strategies to mitigate the impact of the low interest rate environment resulted in a stable net interest margin of 3.51% for the first nine months of 2013, equal to the net interest margin for the first nine months of 2012. Year-to-date 2013, the cost of interest-bearing liabilities has been reduced from 0.87% to 0.54%. Net interest margin for the third quarter of 2013 was 3.49%, compared to 3.53% in the prior quarter, while net interest income of $63.1 million for the third quarter was comparable to the prior quarter and the third quarter of 2012. Loans increased modestly in the third quarter of 2013 as trends continue to reflect management’s disciplined approach of growing quality loans, while maintaining underwriting standards and managing interest rate risk.

Favorable credit quality trends continued as classified loans declined 7% in the third quarter of 2013 and have declined 26% over the last twelve months. Net charge-offs during the quarter were 0.38% of average loans on an annualized basis. The continued strength of National Penn’s asset quality supported a modest reduction in the provision for loan losses to $1.25 million, compared to a provision of $1.5 million in the second quarter of 2013. Asset quality ratios remained strong as non-performing loans were 1.04% of total loans, and the allowance for loan loss coverage of non-performing loans was 184% at September 30, 2013.

Operating expenses 1 of $53.6 million for the third quarter were comparable to both the second quarter of 2013 and the third quarter of 2012. A continued focus on managing operating expenses 1 has resulted in operating expenses 1 increasing by less than 1% through the first nine months of 2013, compared to the prior year period. The efficiency ratio for the third quarter was 58%, compared to 57% for the linked quarter.

National Penn’s Board of Directors declared a fourth quarter 2013 cash dividend of ten cents per common share payable on November 15, 2013 to shareholders of record as of November 2, 2013. At September 30, 2013, the Company’s tier 1 common and tangible common equity 1 to tangible assets ratios were a strong 14.38% and 10.61%, respectively.

Scott V. Fainor stated, “As we close out 2013, we look forward to beginning the relocations of designated teams to our new Reading, Pennsylvania business center, and in the spring of 2014, to our new corporate headquarters in Allentown, Pennsylvania. We are on track with our plan and motivated by the opportunities these moves provide us to leverage the strategic benefits of these locations and increase employee efficiency and collaboration.”

About National Penn Bancshares, Inc.:

National Penn Bancshares, Inc., with approximately $8.4 billion in assets, is a bank holding company based in Pennsylvania. Headquartered in Boyertown, National Penn Bank operates 120 branch offices comprising 119 branches in Pennsylvania and one branch in Maryland.

National Penn’s financial services affiliates are National Penn Wealth Management, N.A., including its National Penn Investors Trust Company division; National Penn Capital Advisors, Inc.; Institutional Advisors LLC; and National Penn Insurance Services Group, Inc., including its Higgins Insurance and Caruso Benefits Group divisions.

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.

1 Statement Regarding Non-GAAP Financial Measures:

This release, including the attached Financial Highlights and financial data tables, 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. These measures should not be considered a substitute for GAAP basis measures nor should they be viewed as a substitute for operating results determined in accordance with GAAP. Management believes the presentation of the following non-GAAP financial measures, which exclude the impact of the specified items, provides useful supplemental information that is essential to a proper understanding of the financial results of National Penn.
  • Tangible common equity excludes goodwill and intangible assets and preferred equity. Banking and financial institution regulators also exclude goodwill and intangible assets from shareholders’ equity when assessing the capital adequacy of a financial institution. Tangible common equity provides a method to assess the Company’s tangible capital trends.
  • Tangible book value expresses tangible common equity on a per share basis. Tangible book value provides a method to assess the level of tangible net assets on a per share basis.
  • Adjusted net income and return on assets exclude the effects of certain gains and losses, adjusted for taxes when applicable. Adjusted net income and return on assets provide methods to assess earnings performance by excluding items that management believes are not comparable among the periods presented.
  • Efficiency ratio expresses operating expenses as a percentage of fully-taxable equivalent net interest income plus non-interest income. Operating expenses exclude items from non-interest expense that management believes are not comparable among the periods presented. Non-interest income is also adjusted to exclude items that management believes are not comparable among the periods presented. Efficiency ratio is used as a method for management to assess its operating expense level and to compare to financial institutions of varying sizes.

Management believes the use of non-GAAP measures will help readers compare National Penn’s current results to those of prior periods as presented in the accompanying Financial Highlights and financial data tables.

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," "could," "plan," "goal," "potential," "pro forma," "seek," "intend," or "anticipate" or the negative thereof or comparable terminology, and include discussions of strategy, financial projections, guidance and estimates (including 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: difficult conditions in the capital markets and the economy generally, regulatory requirements or other actions mandated by National Penn’s regulators, recent and ongoing changes to the state and federal regulatory schemes under which National Penn and other financial services companies operate (including the Dodd-Frank Act and regulations adopted or to be adopted to implement that Act), delayed improvement in the credit quality of loans, the effect of credit risk exposure, the ability to strategically manage our capital position and to raise capital, allowance for loan losses may prove inadequate, variations in interest rates, unanticipated costs from our corporate relocation plan, the geographic concentration of National Penn’s operations, declines in the value of National Penn’s assets and the effect of any resulting impairment charges, competition for personnel and from other financial institutions, interruptions or breaches of National Penn’s security systems, the development and maintenance of National Penn’s information technology, potential dilution of National Penn’s shareholders, the ability of National Penn and its subsidiaries to pay dividends, severe weather and natural disasters, and the nature and frequency of litigation and other similar proceedings to which National Penn may be a party . These risks and others are described in greater detail in National Penn’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, 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.
     
Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2013
     
Unaudited, dollars in thousands except share and per share data
As of
9/30/2013   6/30/2013   9/30/2012
SUMMARY BALANCE SHEET            
Total assets $ 8,424,623 $ 8,316,585 $ 8,435,526
Investment securities and other securities 2,364,681 2,313,358 2,310,459
Total loans 5,282,691 5,261,296 5,256,854
Deposits 6,435,456 6,022,463 5,947,744
Borrowings 761,506 1,089,199 1,216,707
Shareholders' equity 1,131,278 1,115,758 1,214,330
Tangible book value per common share (2) $ 5.94 $ 5.83 $ 6.29
Tangible common equity / tangible assets (2) 10.61% 10.55% 11.56%
 
Three Months Ended Nine Months Ended
9/30/2013   6/30/2013   9/30/2012 9/30/2013       9/30/2012
EARNINGS                      
Total interest income $ 71,498 $ 72,101 $ 78,344 $ 216,194 $ 239,654
Total interest expense   8,386   8,847   14,790   28,204   49,083
Net interest income 63,112 63,254 63,554 187,990 190,571
Provision for loan losses   1,250   1,500   2,000   4,250   6,000
Net interest income after provision for loan losses 61,862 61,754 61,554 183,740 184,571
Net gains from fair value changes of subordinated debentures - - 101 2,111 936
Net gains (losses) on investment securities 7 22 - 54 (277)
Other non-interest income 24,801 24,946 26,664 73,188 70,803
Loss on debt extinguishment - - - 64,888 -
Other non-interest expense   53,603   53,153   53,339   159,190   158,048
Income before income taxes 33,067 33,569 34,980 35,015 97,985
Income tax expense   8,507   8,550   8,964   2,840   24,219
Net income $ 24,560 $ 25,019 $ 26,016 $ 32,175 $ 73,766
 
PERFORMANCE RATIOS                      
Net interest margin 3.49% 3.53% 3.50% 3.51% 3.51%
Return on average assets 1.17% 1.21% 1.23% 0.52% 1.17%
Adjusted return on average assets (3) 1.17% 1.21% 1.23% 1.17% 1.16%
Return on average shareholders' equity 8.78% 8.82% 8.60% 3.81% 8.22%
Return on average tangible common equity (1) 11.55% 11.53% 11.10% 4.99% 10.64%
Adjusted return on average tangible common equity 11.55% 11.53% 11.07% 11.31% 10.64%
Efficiency ratio (4) 58.16% 57.43% 56.26% 58.06% 57.36%
 
PER SHARE                      
Basic earnings $ 0.17 $ 0.17 $ 0.17 $ 0.22 $ 0.49
Diluted earnings 0.17 0.17 0.17 0.22 0.49
Dividends 0.10 0.10 0.09 0.20 (a) 0.21
Average shares - basic 145,669,300 145,580,155 150,157,622 145,549,146 151,325,579
Average shares - diluted 146,124,821 145,997,009 150,454,749 145,976,521 151,615,435
                         
 
(1) RECONCILIATION TABLES FOR NON-GAAP FINANCIAL MEASURES Three Months Ended Nine Months Ended
9/30/2013   6/30/2013   9/30/2012 9/30/2013       9/30/2012
Return on average tangible common equity
Return on average shareholders' equity 8.78% 8.82% 8.60% 3.81% 8.22%
Effect of goodwill and intangibles   2.77%   2.71%   2.50%   1.18%   2.42%
Return on average tangible common equity   11.55%   11.53%   11.10%   4.99%   10.64%
Average tangible equity
Average shareholders' equity $ 1,110,081 $ 1,137,659 $ 1,203,072 $ 1,130,070 $ 1,198,422
Average goodwill and intangibles   (266,326)   (267,264)   (270,720)   (267,301)   (272,019)
Average tangible common equity $ 843,755 $ 870,395 $ 932,352 $ 862,769 $ 926,403
 
Adjusted net income reconciliation
Net income $ 24,560 $ 25,019 $ 26,016 $ 32,175 $ 73,766
After tax unrealized fair value gain on subordinated debentures - - (66) (1,372) (608)
After tax loss on debt extinguishment   -   -   -   42,177   -
Adjusted net income $ 24,560 $ 25,019 $ 25,950 $ 72,980 $ 73,158
 
Earnings per share
Net income $ 0.17 $ 0.17 $ 0.17 $ 0.22 $ 0.49
After tax unrealized fair value gain on subordinated debentures - - - (0.01) -
After tax loss on debt extinguishment   -   -   -   0.29   -
Adjusted net income $ 0.17 $ 0.17 $ 0.17 $ 0.50 $ 0.49
 
(a) In lieu of a first quarter 2013 cash dividend, the Company paid an additional dividend of $0.10 per share in the fourth quarter of 2012
 
       
Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2013
     
Unaudited, dollars in thousands except share and per share data As of
9/30/2013   6/30/2013   3/31/2013       12/31/2012       9/30/2012
BALANCE SHEET - ASSETS
Cash and due from banks $ 137,795 $ 118,575 $ 87,588 $ 145,688 $ 120,421
Interest-earning deposits with banks   78,895     63,193     93,024     282,440     211,943  
Total cash and cash equivalents 216,690 181,768 180,612 428,128 332,364
 
Investment securities available-for-sale, at fair value 1,875,676 1,799,831 1,813,348 1,802,213 1,773,579
Investment securities held-to-maturity 444,898 452,275 458,041 464,166 472,884
Other securities 44,107 61,252 62,159 68,360 63,996
Loans held-for-sale 2,752 12,289 14,934 14,330 22,703
 
Loans 5,279,939 5,249,007 5,234,839 5,226,552 5,234,151
Allowance for loan losses   (100,763 )   (104,533 )   (107,164 )   (110,955 )   (113,542 )
Loans, net 5,179,176 5,144,474 5,127,675 5,115,597 5,120,609
 
Premises and equipment, net 93,871 94,673 95,592 96,334 96,349
Accrued interest receivable 27,831 28,453 29,524 28,526 31,448
Bank owned life insurance 146,906 145,670 144,452 143,242 141,991
Other real estate owned and other repossessed assets 1,569 1,899 2,729 3,029 7,174
Goodwill 258,279 258,279 258,279 258,279 258,279
Other intangible assets, net 7,656 8,470 9,533 10,614 11,852
Unconsolidated investments 9,177 8,673 9,354 11,347 11,337
Other assets   116,035     118,579     117,545     85,357     90,961  
TOTAL ASSETS $ 8,424,623   $ 8,316,585   $ 8,323,777   $ 8,529,522   $ 8,435,526  
 
BALANCE SHEET - LIABILITIES
Non-interest bearing deposits $ 1,026,546 $ 942,127 $ 919,783 $ 891,401 $ 902,295
Interest bearing deposits   5,408,910     5,080,336     5,264,277     5,044,164     5,045,449  
Total deposits 6,435,456 6,022,463 6,184,060 5,935,565 5,947,744
 
Customer repurchase agreements 521,779 547,736 549,894 560,065 534,613
Repurchase agreements 50,000 50,000 175,000 75,000 75,000
Short-term borrowings - - - 100,000 -
Federal Home Loan Bank advances (b) 112,406 414,142 119,877 464,632 462,720
Subordinated debentures 77,321 77,321 77,321 144,627 144,374
Accrued interest payable and other liabilities   96,383     89,165     80,827     88,341     56,745  
TOTAL LIABILITIES   7,293,345     7,200,827     7,186,979     7,368,230     7,221,196  
 
BALANCE SHEET - SHAREHOLDERS' EQUITY
Common stock 1,387,052 1,386,178 1,385,255 1,387,644 1,387,073
Accumulated deficit (182,628 ) (192,623 ) (203,084 ) (185,680 ) (181,225 )
Accumulated other comprehensive (loss) income (13,504 ) (17,189 ) 15,981 24,329 28,617
Treasury stock   (59,642 )   (60,608 )   (61,354 )   (65,001 )   (20,135 )
TOTAL SHAREHOLDERS' EQUITY   1,131,278     1,115,758     1,136,798     1,161,292     1,214,330  
 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 8,424,623   $ 8,316,585   $ 8,323,777   $ 8,529,522   $ 8,435,526  
 
 
PER SHARE DATA
Book value $ 7.76 $ 7.66 $ 7.81 $ 8.00 $ 8.09
Tangible book value (2) $ 5.94 $ 5.83 $ 5.97 $ 6.15 $ 6.29
Dividends - quarterly $ 0.10 $ 0.10 $ - (a) $ 0.20 (a) $ 0.09
Shares outstanding (end of period, net of treasury) 145,723,276 145,608,945 145,551,796 145,163,585 150,048,383
                             
 
(2) RECONCILIATION TABLE FOR NON-GAAP FINANCIAL MEASURES
 
Total shareholders' equity $ 1,131,278 $ 1,115,758 $ 1,136,798 $ 1,161,292 $ 1,214,330
Goodwill and intangibles   (265,935 )   (266,749 )   (267,812 )   (268,893 )   (270,131 )
Tangible common equity $ 865,343   $ 849,009   $ 868,986   $ 892,399   $ 944,199  
Shares outstanding 145,723,276 145,608,945 145,551,796 145,163,585 150,048,383
Tangible book value per share $ 5.94 $ 5.83 $ 5.97 $ 6.15 $ 6.29
 
Total assets $ 8,424,623 $ 8,316,585 $ 8,323,777 $ 8,529,522 $ 8,435,526
Goodwill and intangibles   (265,935 )   (266,749 )   (267,812 )   (268,893 )   (270,131 )
Tangible assets $ 8,158,688   $ 8,049,836   $ 8,055,965   $ 8,260,629   $ 8,165,395  
Tangible common equity/tangible assets

10.61%

 

10.55%

 

10.79%

 

10.80%

 

11.56%

 
 
(3) RECONCILIATION TABLE FOR NON-GAAP FINANCIAL MEASURES
 
Adjusted net income (1) $ 24,560 $ 25,019 $ 23,401 $ 25,308 $ 25,950
Average assets $ 8,310,626 $ 8,326,499 $ 8,298,815 $ 8,440,642 $ 8,386,342
Adjusted return on average assets (annualized)

1.17%

 

1.21%

 

1.14%

 

1.19%

 

1.23%

 
 
(b) Net of unamortized prepayment fees of $65.5 million and $67.6 million at December 31, 2012 and September 30, 2012, respectively
 
 
Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2013
           
Unaudited, dollars in thousands except share and per share data For the Quarter Ended For the Nine Months Ended
9/30/2013   6/30/2013   3/31/2013   12/31/2012   9/30/2012 9/30/2013   9/30/2012
INTEREST INCOME
Loans, including fees $ 54,577 $ 55,260 $ 55,721 $ 59,005 $ 60,269 $ 165,558 $ 183,676
Investment securities
Taxable 10,105 9,795 9,685 10,050 10,525 29,585 32,675
Tax-exempt 6,768 7,005 7,114 7,233 7,402 20,887 22,819
Deposits with banks   48     41     75     886     148     164     484  
Total interest income   71,498     72,101     72,595     77,174     78,344     216,194     239,654  
INTEREST EXPENSE
Deposits 5,468 5,831 5,914 6,177 6,472 17,213 20,645
Customer repurchase agreements 440 460 498 510 511 1,398 1,606
Repurchase agreements 614 623 719 802 843 1,956 2,673
Short-term borrowings - - 41 1 - 41 -
Federal Home Loan Bank advances 1,325 1,383 2,334 4,410 5,105 5,042 18,573
Subordinated debentures   539     550     1,465     1,839     1,859     2,554     5,586  

Total interest expense
  8,386     8,847     10,971     13,739     14,790     28,204     49,083  
Net interest income 63,112 63,254 61,624 63,435 63,554 187,990 190,571
Provision for loan losses   1,250     1,500     1,500     2,000     2,000     4,250     6,000  
Net interest income after provision for loan losses   61,862     61,754     60,124     61,435     61,554     183,740     184,571  
NON-INTEREST INCOME
Wealth management 6,883 6,986 6,831 6,224 6,239 20,700 18,405
Service charges on deposit accounts 3,894 3,743 3,770 4,140 4,147 11,407 11,723
Insurance commissions and fees 3,071 3,326 3,267 3,113 3,238 9,664 9,745
Cash management and electronic banking fees 4,860 4,821 4,451 4,761 4,626 14,132 13,753
Mortgage banking 1,621 2,122 1,855 2,498 2,296 5,598 5,142
Bank owned life insurance 1,260 1,239 1,228 1,326 1,319 3,727 3,783
Earnings (losses) of unconsolidated investments 661 6 (14 ) 138 1,315 653 1,349
Other operating income 2,551 2,703 2,053 2,555 3,484 7,307 6,903
Net gains (losses) from fair value changes of subordinated debentures - - 2,111 (253 ) 101 2,111 936
Net gains (losses) on sales of investment securities 7 22 25 4 - 54 (123 )

Impairment losses on investment securities:
Impairment related losses on investment securities - - - - - - (154 )

Non credit-related losses on securities not expected to be sold recognized in other comprehensive income before tax
  -     -     -     -     -     -     -  
Net impairment losses on investment securities   -     -     -     -     -     -     (154 )
Total non-interest income   24,808     24,968     25,577     24,506     26,765     75,353     71,462  
NON-INTEREST EXPENSE
Salaries, wages and employee benefits 31,704 31,247 30,873 30,789 31,555 93,824 94,170
Premises and equipment 7,724 7,511 7,491 7,396 7,226 22,726 21,428
FDIC insurance 1,404 1,494 1,213 1,162 1,259 4,111 3,734
Other operating expenses 12,771 12,901 12,857 12,915 13,299 38,529 38,716
Loss on debt extinguishment   -     -     64,888     -     -     64,888     -  

Total non-interest expense
  53,603     53,153     117,322     52,262     53,339     224,078     158,048  
Income (loss) before income taxes 33,067 33,569 (31,621 ) 33,679 34,980 35,015 97,985
Income tax expense (benefit)   8,507     8,550     (14,217 )   8,535     8,964     2,840     24,219  
NET INCOME (LOSS) $ 24,560   $ 25,019   $ (17,404 ) $ 25,144   $ 26,016   $ 32,175   $ 73,766  
 
PER SHARE
Basic earnings $ 0.17 $ 0.17 $ (0.12 ) $ 0.17 $ 0.17 $ 0.22 $ 0.49
Diluted earnings $ 0.17 $ 0.17 $ (0.12 ) $ 0.17 $ 0.17 $ 0.22 $ 0.49
Average shares - basic 145,669,300 145,580,155 145,394,967 148,304,167 150,157,622 145,549,146 151,325,579
Average shares - diluted 146,124,821 145,997,009 145,394,967 148,610,097 150,454,749 145,976,521 151,615,435
 
SUPPLEMENTAL DATA (annualized, average)
Return on assets 1.17 % 1.21 % NM 1.19 % 1.23 % 0.52 % 1.17 %
Adjusted return on assets (3) 1.17 % 1.21 % 1.14 % 1.19 % 1.23 % 1.17 % 1.16 %
Return on shareholders' equity 8.78 % 8.82 % NM 8.33 % 8.60 % 3.81 % 8.22 %
Return on tangible common equity (1) 11.55 % 11.53 % NM 10.74 % 11.10 % 4.99 % 10.64 %
Adjusted return on tangible common equity 11.55 % 11.53 % 10.85 % 10.81 % 11.07 % 11.31 % 10.64 %
Efficiency ratio (4) 58.16 % 57.43 % 58.61 % 56.40 % 56.26 % 58.06 % 57.36 %
                             
 
(4) RECONCILIATION TABLE FOR NON-GAAP FINANCIAL MEASURES
 
Efficiency ratio calculation
Non-interest expense $ 53,603 $ 53,153 $ 117,322 $ 52,262 $ 53,339 $ 224,078 $ 158,048
Less:

Loss on debt extinguishment
  -     -     64,888     -     -     64,888     -  
Operating expenses $ 53,603   $ 53,153   $ 52,434   $ 52,262   $ 53,339   $ 159,190   $ 158,048  
 
Net interest income (taxable equivalent) $ 67,371 $ 67,610 $ 66,015 $ 67,909 $ 68,139 $ 200,996 $ 204,713
 
Non-interest income 24,808 24,968 25,577 24,506 26,765 75,353 71,462
Less:
Net gains (losses) from fair value changes of subordinated debentures - - 2,111 (253 ) 101 2,111 936
Net gains (losses) on investment securities   7     22     25     4     -     54     (277 )
Adjusted revenue $ 92,172   $ 92,556   $ 89,456   $ 92,664   $ 94,803   $ 274,184   $ 275,516  
 
Efficiency ratio 58.16 % 57.43 % 58.61 % 56.40 % 56.26 % 58.06 % 57.36 %
 
"NM" - Denotes a value displayed as a percentage is not meaningful
 
       
Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2013
   
Unaudited, dollars in thousands except share and per share data For the Quarter Ended For the Nine Months Ended
9/30/2013   6/30/2013   3/31/2013   12/31/2012   9/30/2012 9/30/2013   9/30/2012
CHARGE-OFFS
Loan charge-offs $ 5,774 $ 5,314 $ 6,382 $ 5,876 $ 5,993 $ 17,470 $ 22,622
Recoveries on loans   (754 )   (1,183 )   (1,091 )   (1,289 )   (885 )   (3,028 )   (3,524 )
Net loan charge-offs $ 5,020   $ 4,131   $ 5,291   $ 4,587   $ 5,108   $ 14,442   $ 19,098  
Net loan charge-offs to average loans (annualized)   0.38 %   0.32 %   0.41 %   0.35 %   0.39 %   0.37 %   0.49 %
 
NET CHARGE-OFF DETAIL
Commercial and industrial loans $ 3,059 $ 2,065 $ 1,869 $ 2,029 $ 1,116 $ 6,993 $ 8,237
 
Commercial real estate-permanent 909 396 282 301 481 1,587 3,009
Commercial real estate-construction   (29 )   93     318     266     1,755     382     2,280  
Total commercial real estate loans 880 489 600 567 2,236 1,969 5,289
 
Residential mortgages 209 522 1,333 988 742 2,064 1,630
Home equity lines and loans 423 903 747 515 517 2,073 2,776
All other consumer loans   449     152     742     488     497     1,343     1,166  
Total consumer loans   1,081     1,577     2,822     1,991     1,756     5,480     5,572  
 
Net loans charged-off $ 5,020   $ 4,131   $ 5,291   $ 4,587   $ 5,108   $ 14,442   $ 19,098  
 
As of
9/30/2013   6/30/2013   3/31/2013   12/31/2012   9/30/2012
ASSET QUALITY AND OTHER DATA
Non-accrual commercial and industrial loans $ 23,101 $ 23,023 $ 23,323 $ 24,653 $ 31,109
 
Non-accrual commercial real estate-permanent 3,760 5,129 5,489 2,984 3,780
Non-accrual commercial real estate-construction   5,345     5,666     6,067     5,446     5,149  
Total non-accrual commercial real estate loans 9,105 10,795 11,556 8,430 8,929
 
Non-accrual residential mortgages 6,485 6,276 5,608 7,066 6,242
Non-accrual home equity lines and loans 4,403 4,339 4,364 3,692 3,458
All other non-accrual consumer loans   1,705     1,916     1,595     1,705     1,823  
Total non-accrual consumer loans 12,593 12,531 11,567 12,463 11,523
         
Total non-accrual loans 44,799 46,349 46,446 45,546 51,561
 
Restructured loans   10,006     9,109     7,314     8,362     6,726  
Total non-performing loans 54,805 55,458 53,760 53,908 58,287
 
Other real estate owned and repossessed assets   1,569     1,899     2,729     3,029     7,174  
Total non-performing assets 56,374 57,357 56,489 56,937 65,461
 
Loans 90+ days past due & still accruing   2,608     2,023     2,324     2,027     2,628  
Total non-performing assets and loans 90+ days past due $ 58,982   $ 59,380   $ 58,813   $ 58,964   $ 68,089  
 
Allowance for loan losses $ 100,763   $ 104,533   $ 107,164   $ 110,955   $ 113,542  
Allowance for loan losses/non-performing loans   183.9 %   188.5 %   199.3 %   205.8 %   194.8 %
Allowance for loan losses/non-performing assets and loans
90+ days past due   170.8 %   176.0 %   182.2 %   188.2 %   166.8 %
Allowance for loan losses/total loans   1.91 %   1.99 %   2.04 %   2.12 %   2.16 %
Provision/charge-offs, net   24.9 %   36.3 %   28.4 %   43.6 %   39.2 %
Classified loans $ 218,615   $ 234,085   $ 242,560   $ 261,293   $ 296,213  
Classified loans/total loans   4.14 %   4.45 %   4.62 %   4.99 %   5.63 %
Delinquent loans (c) $ 22,550   $ 22,512   $ 24,110   $ 24,048   $ 23,519  
Delinquent loans/total loans   0.43 %   0.43 %   0.46 %   0.46 %   0.45 %
 
As of
9/30/2013   6/30/2013   3/31/2013   12/31/2012   9/30/2012
REGULATORY CAPITAL DATA
Tier 1 Capital $ 938,040   $ 924,922   $ 927,397   $ 982,148   $ 1,024,888  
Tier 1 Leverage Ratio   11.67 %   11.56 %   11.63 %   12.16 %   12.78 %
Tier 1 Ratio (%)   15.63 %   15.51 %   15.41 %   16.54 %   17.45 %
Total Capital $ 1,013,371   $ 999,839   $ 1,002,999   $ 1,056,835   $ 1,098,814  
Total Capital Ratio (%)   16.89 %   16.77 %   16.67 %   17.80 %   18.70 %
Total Risk-Weighted Assets $ 6,001,065   $ 5,963,754   $ 6,016,630   $ 5,938,708   $ 5,874,448  
 
(c) Includes loans 30-89 days past due and loans 90+ days past due and still accruing
 
   
Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2013
     
Unaudited, dollars in thousands except share and per share data
As of
Earning Assets / Liabilities 9/30/2013   6/30/2013   3/31/2013   12/31/2012   9/30/2012

Loan portfolio composition (regulatory):
Commercial / industrial $ 820,669 $ 861,494 $ 857,728 $ 868,135 $ 846,484
Commercial real estate (d) 1,913,180 1,887,908 1,863,381 1,838,681 1,803,532
Residential mortgage 1,170,750 1,185,986 1,191,075 1,234,425 1,262,897
Real estate construction and land development 234,945 201,316 180,298 161,341 189,293
Home equity 786,835 778,521 776,166 782,717 776,023
Consumer 205,446 201,580 201,349 208,856 207,333
Other   150,866   144,491   179,776   146,727   171,292
Total 5,282,691 5,261,296 5,249,773 5,240,882 5,256,854
 
Investment securities and other securities 2,364,681 2,313,358 2,333,548 2,334,739 2,310,459
Other earning assets   78,895   63,193   93,024   282,440   211,943
Total earning assets (net of loan loss reserve) $ 7,625,504 $ 7,533,314 $ 7,569,181 $ 7,747,106 $ 7,665,714
(d) Includes owner occupied
 

Loan portfolio composition (internal):
Commercial & industrial
Business purpose, real estate secured $ 897,757 $ 901,205 $ 891,229 $ 886,160 $ 879,326
Business purpose, not secured by real estate 935,857 976,281 1,000,141 977,875 979,042
Owner occupied commercial real estate
Permanent 585,807 609,615 604,278 599,729 572,298
Construction / development 41,088 31,058 32,603 30,523 31,181
Leasing   392   630   1,128   1,568   2,102
Total commercial & industrial 2,460,901 2,518,789 2,529,379 2,495,855 2,463,949
 
Commercial real estate
Non-owner occupied
Permanent 964,510 919,080 898,519 907,760 918,511
Construction / development   181,683   153,172   145,324   125,878   140,889
Total commercial real estate   1,146,193   1,072,252   1,043,843   1,033,638   1,059,400
Total commercial 3,607,094 3,591,041 3,573,222 3,529,493 3,523,349
 
Consumer
Residential mortgage (personal purpose)
Permanent 642,696 640,745 649,522 666,274 683,694
Construction   9,443   7,076   6,009   5,498   6,079
Total residential mortgages 652,139 647,821 655,531 671,772 689,773
 
Home equity and direct installment 208,333 220,401 237,088 254,014 273,359
Home equity lines of credit   550,417   530,104   507,347   500,372   478,628
Total home equity 758,750 750,505 744,435 754,386 751,987
 
Private banking credit lines 98,714 98,865 99,154 103,806 103,006
Indirect vehicle and other   163,242   160,775   162,497   167,095   166,036
All other consumer   261,956   259,640   261,651   270,901   269,042
Total consumer   1,672,845   1,657,966   1,661,617   1,697,059   1,710,802
 
Loans 5,279,939 5,249,007 5,234,839 5,226,552 5,234,151
 
Loans held-for-sale 2,752 12,289 14,934 14,330 22,703
         
Total loans $ 5,282,691 $ 5,261,296 $ 5,249,773 $ 5,240,882 $ 5,256,854
 

Deposit composition:
Savings $ 518,430 $ 527,216 $ 520,223 $ 493,386 $ 485,283
NOW accounts 1,958,116 1,545,659 1,471,185 1,472,985 1,498,344
Money market accounts 1,639,859 1,654,442 1,647,863 1,642,803 1,600,164
Time deposits less than $100k 925,118 963,238 991,380 1,017,925 1,036,112
Time deposits $100k or greater   367,387   389,781   633,626   417,065   425,546
Total interest bearing deposits 5,408,910 5,080,336 5,264,277 5,044,164 5,045,449
 
Non-interest bearing deposits   1,026,546   942,127   919,783   891,401   902,295
 
Total deposits $ 6,435,456 $ 6,022,463 $ 6,184,060 $ 5,935,565 $ 5,947,744
 
                 
Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2013
         
Unaudited, dollars in thousands except share and per share data Quarterly, as of Nine Months, as of
9/30/2013   6/30/2013   3/31/2013   12/31/2012   9/30/2012 9/30/2013   9/30/2012
Avg Bal Yield Avg Bal Yield Avg Bal Yield Avg Bal Yield Avg Bal Yield Avg Bal Yield Avg Bal Yield
 
Total loans* $ 5,229,366 4.19 % $ 5,244,930 4.27 % $ 5,223,015 4.37 % $ 5,206,227 4.55 % $ 5,191,136 4.66 % $ 5,232,460 4.28 % $ 5,189,061 4.78 %
Investment securities* 2,316,066 3.51 % 2,334,594 3.53 % 2,325,225 3.60 % 2,323,243 3.63 % 2,309,646 3.77 % 2,325,262 3.55 % 2,315,694 3.91 %
Interest earning deposits   102,581 0.19 %   94,788 0.17 %   119,834 0.25 %   276,078 1.28 %   255,121 0.23 %   105,671 0.21 %   289,272 0.22 %
 
Total earning assets   7,648,013 3.93 %   7,674,312 4.00 %   7,668,074 4.07 %   7,805,548 4.16 %   7,755,903 4.25 %   7,663,393 4.00 %   7,794,027 4.35 %
Total assets   8,310,626   8,326,499   8,298,815   8,440,642   8,386,342   8,312,023   8,418,843
 
Savings 524,178 0.11 % 525,494 0.11 % 505,513 0.11 % 488,195 0.11 % 490,020 0.11 % 518,463 0.11 % 485,477 0.12 %
NOW accounts 1,732,394 0.14 % 1,543,649 0.14 % 1,439,387 0.14 % 1,463,488 0.14 % 1,402,593 0.14 % 1,572,882 0.14 % 1,328,690 0.15 %
Money market accounts 1,655,133 0.27 % 1,646,691 0.29 % 1,645,838 0.30 % 1,630,449 0.30 % 1,623,102 0.32 % 1,650,516 0.29 % 1,655,431 0.36 %
Time deposits   1,312,810 1.09 %   1,464,421 1.08 %   1,507,667 1.10 %   1,454,415 1.17 %   1,468,539 1.23 %   1,427,585 1.09 %   1,503,237 1.27 %
 
Total interest bearing deposits   5,224,515 0.42 %   5,180,255 0.45 %   5,098,405 0.47 %   5,036,547 0.49 %   4,984,254 0.52 %   5,169,446 0.45 %   4,972,835 0.55 %
 
Non-interest bearing deposits   963,625   913,311   876,700   886,858   897,017   916,936   880,556
Total deposits   6,188,140 0.35 %   6,093,566 0.38 %   5,975,105 0.40 %   5,923,405 0.41 %   5,881,271 0.44 %   6,086,382 0.38 %   5,853,391 0.47 %
 
Customer repurchase agreements 518,569 0.34 % 523,585 0.35 % 547,706 0.37 % 551,334 0.37 % 532,065 0.38 % 529,847 0.35 % 527,278 0.41 %
Repurchase agreements 50,000 4.87 % 63,736 3.92 % 135,454 2.15 % 75,000 4.25 % 78,370 4.28 % 82,750 3.16 % 82,774 4.31 %
Short-term borrowings - 0.00 % - 0.00 % 39,200 0.42 % 1,087 0.37 % 272 0.00 % 12,557 0.44 % 91 0.00 %
Federal Home Loan Bank advances (b) 277,101 1.90 % 348,814 1.59 % 262,067 3.61 % 463,397 3.79 % 496,438 4.09 % 296,417 2.27 % 562,474 4.41 %
Subordinated debentures   77,321 2.77 %   77,321 2.85 %   125,207 4.75 %   144,377 5.07 %   144,472 5.12 %   93,107 3.67 %   144,476 5.16 %
Total deposits and borrowings   7,111,131 0.47 %   7,107,022 0.50 %   7,084,739 0.63 %   7,158,600 0.76 %   7,132,888 0.82 %   7,101,060 0.53 %   7,170,484 0.91 %
Total interest bearing liabilities $ 6,147,506 0.54 % $ 6,193,711 0.57 % $ 6,208,039 0.72 % $ 6,271,742 0.87 % $ 6,235,871 0.94 % $ 6,184,124 0.61 % $ 6,289,928 1.04 %
 
Net interest margin (FTE) 3.49 % 3.53 % 3.49 % 3.46 % 3.50 % 3.51 % 3.51 %
 
Wealth assets under management $ 2,388,991 $ 2,285,199 $ 2,328,042 $ 2,256,319 $ 2,319,220
 
*Fully taxable equivalent ("FTE") basis, using a 35% effective tax rate
 
   
Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2013
     
Unaudited
 
STATES OF OPERATION AND BANKING OFFICES BY STATE (LATEST AVAILABLE DATA)
 
Quarterly, as of
9/30/2013   6/30/2013   3/31/2013   12/31/2012   9/30/2012
 

PA
Total number of retail branch offices 119 119 118 119 119
Total number of insured subsidiaries
(Bank & Thrift subsidiaries) 1 1 1 1 1
Total number of ATMs 124 124 124 124 124
 

MD
Total number of retail branch offices 1 1 1 1 1
Total number of insured subsidiaries
(Bank & Thrift subsidiaries) - - - - -
Total number of ATMs 1 1 1 1 1
 

TOTAL
Total number of retail branch offices 120 120 119 120 120
Total number of insured subsidiaries
(Bank & Thrift subsidiaries) 1 1 1 1 1
Total number of ATMs 125 125 125 125 125
 
EOP employees (full-time equivalent) 1,632 1,666 1,657 1,648 1,661
 

Copyright Business Wire 2010

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