NPBC National Penn Bancshares, Inc.

• Earnings per diluted share of $0.20 for the third quarter of 2015, $0.21 exclusive of merger-related expenses, compared to $0.19 for the prior quarter
• Excluding the impact of merger-related expenses, return on average assets of 1.22% and return on average tangible common equity of 13.94% for the third quarter of 2015
• Operating expenses remain well controlled; year-to-date efficiency ratio of 56%
• Sustained strength in asset quality and capital levels
• Fourth quarter 2015 cash dividend of $0.11 cents per common share declared

National Penn Bancshares, Inc. (Nasdaq: NPBC) reported net income of $27.9 million, or $0.20 per diluted share, for the third quarter of 2015, compared to $27.2 million or $0.19 per diluted share in the second quarter of 2015. Net income for the three quarters ending September 30, 2015 was $81.8 million compared to $74.2 million in the prior year period, while earnings per diluted share of $0.58 through the three quarters of 2015 increased 9.4% from the comparable period last year. The third quarter of 2015 and year-to-date 2015 results include after-tax merger related expenses totaling $1.4 million or $0.01 per diluted share. Excluding the impact of merger-related expenses, return on average assets was 1.22% and return on average tangible common equity was 13.94%, for the third quarter of 2015.

“We are pleased with our continued strong and consistent financial performance, especially in this challenging interest rate environment,” said Scott V. Fainor, president and CEO of National Penn. “In addition, we are moving forward to obtain the necessary approvals for our merger with BB&T, and look forward to our affiliation with BB&T and the strength of our combined franchise.”

Net Interest Margin

Net interest income was $67.9 million for the third quarter of 2015, compared to $66.8 million last quarter. Our net interest margin of 3.25% for the third quarter of 2015 remained stable compared to 3.24% for the prior quarter. Total loan outstandings of $6.2 billion at September 30, 2015 were comparable to the end of the second quarter of 2015. The year-to-date loan growth was impacted by our continued strategy to sell long-term fixed rate residential mortgage loans.

Asset Quality

The strong trend in asset quality continued in the third quarter as non-performing loans decreased 5% from last quarter. The ratio of allowance for loan losses to non-performing loans increased to 186% at September 30, 2015, compared to 180% at the end of last quarter. Net charge-offs decreased to $2.7 million or 0.17% of average total loans (annualized) this quarter, compared to $5.9 million or 0.39% last quarter, as the second quarter reflects the resolution of a large non-performing commercial loan for which a specific loan loss reserve was recorded in the fourth quarter of last year. The provision for loan losses of $1.0 million for the third quarter was consistent with the prior quarter and commensurate with the strong credit quality profile of our loan portfolio.

Other Income and Operating Expenses

Despite fluctuations in the components of non-interest income during the quarter, total non-interest income aggregated to $25.0 million in the third quarter of 2015, compared to $24.7 million in the prior quarter.

Total non-interest expense of $54.2 million, for the third quarter of 2015, included merger-related costs of $1.8 million. Excluding the impact of merger-related costs, our efficiency ratio of 54% this quarter compared to 57% in the prior quarter.

Capital

At September 30, 2015, our capital ratios remained strong as common equity tier 1 and tangible common equity to tangible assets ratios were 12.27% and 9.15%.

As previously announced, National Penn’s Board of Directors declared a fourth quarter cash dividend of eleven cents ($0.11) per common share, to shareholders of record as of Monday, November 2, 2015, payable on Tuesday, November 17, 2015.

“Our consistent strong financial performance is a reflection of the continued efforts of all of our team members here at National Penn,” said Scott V. Fainor.

About National Penn Bancshares, Inc.:

National Penn Bancshares, Inc., with approximately $9.6 billion in assets, is a bank holding company headquartered in Allentown, Pennsylvania. National Penn Bank operates 124 branch offices throughout Pennsylvania, New Jersey and Maryland.

National Penn’s financial services affiliates include its National Penn Investors Trust Company division; Institutional Advisors LLC; and National Penn Insurance Services Group, 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, including the attached Financial Highlights and financial data tables, contains supplemental financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (“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 adjusted return on average assets exclude the effects of certain gains and losses, adjusted for taxes when applicable. Adjusted net income and adjusted return on average 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: Risks, uncertainties and other factors relating to the merger of National Penn with and into BB&T Corporation, including the ability to obtain regulatory approvals and meet other closing conditions to the merger, including approval by National Penn shareholders, and delay in closing the merger, 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, 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, 2014, 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 9/30/2015             Unaudited, dollars in thousands except share and per share data As of 9/30/2015 6/30/2015 9/30/2014 SUMMARY BALANCE SHEET Total assets $ 9,587,459 $ 9,604,314 $ 8,633,000 Investment securities and other securities 2,503,203 2,507,615 2,381,751 Total loans 6,168,528 6,168,481 5,469,842 Deposits 6,959,275 6,733,484 6,287,936 Borrowings 1,359,657 1,631,537 1,141,766 Shareholders' equity 1,158,423 1,137,678 1,107,184 Tangible book value per common share (2) $ 6.05 $ 5.90 $ 6.06 Tangible common equity / tangible assets (2) 9.15 % 8.90 % 10.08 %   Three Months Ended Nine Months Ended 9/30/2015 6/30/2015 9/30/2014 9/30/2015 9/30/2014 EARNINGS Total interest income $ 76,529 $ 75,417 $ 71,368 $ 229,040 $ 212,029 Total interest expense   8,662     8,582     7,138     25,656     22,559   Net interest income 67,867 66,835 64,230 203,384 189,470 Provision for loan losses   1,000     1,000     1,000     3,000     2,251   Net interest income after provision for loan losses 66,867 65,835 63,230 200,384 187,219 Net gains on investment securities - - - - 8 Other non-interest income 25,026 24,687 22,871 72,643 68,737 Merger related expenses 1,840 - - 1,840 - Other non-interest expense   52,377     53,960     52,158     160,919     156,609   Income before income taxes 37,676 36,562 33,943 110,268 99,355 Income tax expense   9,800     9,324     8,623     28,427     25,126   Net income $ 27,876   $ 27,238   $ 25,320   $ 81,841   $ 74,229     PERFORMANCE RATIOS Net interest margin 3.25 % 3.24 % 3.43 % 3.28 % 3.43 % Return on average assets 1.16 % 1.14 % 1.17 % 1.15 % 1.16 % Adjusted return on average assets (3) 1.22 % 1.14 % 1.17 % 1.17 % 1.16 % Return on average shareholders' equity 9.69 % 9.66 % 9.11 % 9.60 % 9.07 % Return on average tangible common equity (1) 13.30 % 13.32 % 11.97 % 13.19 % 11.95 % Adjusted return on average tangible common equity 13.94 % 13.32 % 11.97 % 13.41 % 11.95 % Efficiency ratio (4) 54.23 % 56.59 % 57.29 % 55.97 % 57.95 %   PER SHARE Basic earnings $ 0.20 $ 0.19 $ 0.18 $ 0.58 $ 0.53 Diluted earnings 0.20 0.19 0.18 0.58 0.53 Adjusted diluted earnings 0.21 0.19 0.18 0.59 0.53 Dividends 0.11 0.11 0.10 0.33 0.30 Average shares - basic 140,235,094 140,126,314 139,275,683 141,081,076 139,934,960 Average shares - diluted 140,916,194 140,752,713 139,825,134 141,717,928 140,466,437                         (1) RECONCILIATION TABLES FOR NON-GAAP FINANCIAL MEASURES   Three Months Ended Nine Months Ended 9/30/2015 6/30/2015 9/30/2014 9/30/2015 9/30/2014 Return on average tangible common equity Return on average shareholders' equity 9.69 % 9.66 % 9.11 % 9.60 % 9.07 % Effect of goodwill and intangibles   3.61 %   3.66 %   2.86 %   3.59 %   2.88 % Return on average tangible common equity   13.30 %   13.32 %   11.97 %   13.19 %   11.95 % Average tangible equity Average shareholders' equity $ 1,141,586 $ 1,130,896 $ 1,102,608 $ 1,139,858 $ 1,094,569 Average goodwill and intangibles   (309,969 )   (310,601 )   (263,410 )   (310,458 )   (264,084 ) Average tangible common equity $ 831,617   $ 820,295   $ 839,198   $ 829,400   $ 830,485       Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2015             Unaudited, dollars in thousands except share and per share data As of 9/30/2015 6/30/2015 3/31/2015 12/31/2014 9/30/2014 ASSETS Cash and due from banks $ 101,975 $ 120,010 $ 102,500 $ 110,784 $ 96,856 Interest-earning deposits with banks   119,616     118,375     131,166     303,055     98,512   Total cash and cash equivalents 221,591 238,385 233,666 413,839 195,368   Investment securities available-for-sale, at fair value 1,641,230 1,598,351 1,585,671 1,530,661 1,461,586 Investment securities held-to-maturity 807,574 842,192 884,211 921,042 864,234 Other securities 54,399 67,072 67,288 67,512 55,931 Loans held-for-sale 6,239 9,693 11,239 4,178 3,890   Loans 6,162,289 6,158,788 6,120,205 6,142,279 5,465,952 Allowance for loan losses   (83,148 )   (84,816 )   (89,729 )   (90,675 )   (88,927 ) Loans, net 6,079,141 6,073,972 6,030,476 6,051,604 5,377,025   Premises and equipment, net 109,181 111,353 113,217 116,414 110,392 Accrued interest receivable 29,697 29,066 30,018 29,491 27,839 Bank owned life insurance 196,643 199,656 198,123 171,775 151,443 Other real estate owned and other repossessed assets 4,719 5,186 5,474 4,867 1,561 Goodwill 302,940 302,940 302,940 302,244 258,279 Other intangible assets, net 6,725 7,353 7,985 8,757 4,803 Unconsolidated investments 8,552 8,582 8,101 8,124 8,167 Other assets   118,828     110,513     119,545     120,357     112,482   TOTAL ASSETS $ 9,587,459   $ 9,604,314   $ 9,597,954   $ 9,750,865   $ 8,633,000     LIABILITIES Non-interest bearing deposits $ 1,169,922 $ 1,200,631 $ 1,142,192 $ 1,085,158 $ 990,438 Interest bearing deposits   5,789,353     5,532,853     5,555,070     5,644,587     5,297,498   Total deposits 6,959,275 6,733,484 6,697,262 6,729,745 6,287,936   Customer repurchase agreements 573,986 539,850 603,880 607,705 580,290 Federal Home Loan Bank advances and other borrowings 583,350 889,366 854,375 910,378 359,155 Senior long-term debt 125,000 125,000 125,000 125,000 125,000 Subordinated debentures 77,321 77,321 77,321 77,321 77,321 Accrued interest payable and other liabilities   110,104     101,615     109,021     112,077     96,114   TOTAL LIABILITIES   8,429,036     8,466,636     8,466,859     8,562,226     7,525,816     SHAREHOLDERS' EQUITY Common stock 1,389,602 1,388,341 1,387,136 1,390,130 1,388,513 Accumulated deficit (100,459 ) (112,913 ) (124,740 ) (135,246 ) (143,514 ) Accumulated other comprehensive loss (5,727 ) (11,686 ) (3,989 ) (10,991 ) (7,922 ) Treasury stock   (124,993 )   (126,064 )   (127,312 )   (55,254 )   (129,893 ) TOTAL SHAREHOLDERS' EQUITY   1,158,423     1,137,678     1,131,095     1,188,639     1,107,184     TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 9,587,459   $ 9,604,314   $ 9,597,954   $ 9,750,865   $ 8,633,000       PER SHARE DATA Book value $ 8.26 $ 8.12 $ 8.08 $ 8.08 $ 7.95 Tangible book value (2) $ 6.05 $ 5.90 $ 5.86 $ 5.96 $ 6.06 Dividends - quarterly $ 0.11 $ 0.11 $ 0.11 $ 0.11 $ 0.10 Shares outstanding (end of period, net of treasury) 140,283,395 140,184,234 140,068,761 147,136,084 139,305,117                         (2) RECONCILIATION TABLE FOR NON-GAAP FINANCIAL MEASURES   Total shareholders' equity $ 1,158,423 $ 1,137,678 $ 1,131,095 $ 1,188,639 $ 1,107,184 Goodwill and intangibles   (309,665 )   (310,293 )   (310,925 )   (311,001 )   (263,082 ) Tangible common equity $ 848,758   $ 827,385   $ 820,170   $ 877,638   $ 844,102   Shares outstanding 140,283,395 140,184,234 140,068,761 147,136,084 139,305,117 Tangible book value per share $ 6.05 $ 5.90 $ 5.86 $ 5.96 $ 6.06   Total assets $ 9,587,459 $ 9,604,314 $ 9,597,954 $ 9,750,865 $ 8,633,000 Goodwill and intangibles   (309,665 )   (310,293 )   (310,925 )   (311,001 )   (263,082 ) Tangible assets $ 9,277,794   $ 9,294,021   $ 9,287,029   $ 9,439,864   $ 8,369,918   Tangible common equity/tangible assets 9.15 % 8.90 % 8.83 % 9.30 % 10.08 %     Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2015                 Unaudited, dollars in thousands except share and per share data For the Quarter Ended For the Nine Months Ended 9/30/2015 6/30/2015 3/31/2015 12/31/2014 9/30/2014 9/30/2015 9/30/2014 INTEREST INCOME Loans, including fees $ 59,735 $ 58,077 $ 58,424 $ 58,532 $ 53,857 $ 176,236 $ 158,915 Investment securities Taxable 11,180 11,457 12,512 11,273 11,365 35,149 34,180 Tax-exempt 5,577 5,843 6,120 6,129 6,114 17,540 18,847 Deposits with banks   37     40     38     56     32     115     87   Total interest income   76,529     75,417     77,094     75,990     71,368     229,040     212,029   INTEREST EXPENSE Deposits 4,740 4,618 4,521 4,616 4,483 13,879 13,927 Customer repurchase agreements 403 402 405 432 399 1,210 1,192 Repurchase agreements - - - - 197 - 1,406 Federal Home Loan Bank advances and other borrowings 1,606 1,659 1,593 1,398 1,297 4,858 4,215 Senior long-term debt 1,366 1,366 1,366 1,365 227 4,098 227 Subordinated debentures   547     537     527     535     535     1,611     1,592   Total interest expense   8,662     8,582     8,412     8,346     7,138     25,656     22,559   Net interest income 67,867 66,835 68,682 67,644 64,230 203,384 189,470 Provision for loan losses   1,000     1,000     1,000     3,500     1,000     3,000     2,251   Net interest income after provision for loan losses   66,867     65,835     67,682     64,144     63,230     200,384     187,219   NON-INTEREST INCOME Wealth management 6,654 6,854 6,650 7,123 6,945 20,158 20,944 Service charges on deposit accounts 3,468 3,328 3,307 3,725 3,826 10,103 10,744 Insurance commissions and fees 3,128 3,219 3,182 2,979 3,029 9,529 9,835 Cash management and electronic banking fees 5,068 5,153 4,714 4,951 4,720 14,935 14,115 Mortgage banking 1,617 1,652 1,374 1,213 987 4,643 2,639 Bank owned life insurance 2,746 1,563 1,374 1,341 1,238 5,683 3,654 Earnings (losses) of unconsolidated investments 133 589 - (43 ) (20 ) 722 (506 ) Gain on sale of non-performing loans - - - - - - 946 Other operating income 2,212 2,329 2,329 2,128 2,146 6,870 6,366 Net gains on sales of investment securities   -     -     -     13     -     -     8   Total non-interest income   25,026     24,687     22,930     23,430     22,871     72,643     68,745   NON-INTEREST EXPENSE Salaries, wages and employee benefits 29,570 30,123 29,998 27,836 29,655 89,691 87,743 Premises and equipment 8,189 8,508 9,147 8,254 7,769 25,844 23,690 FDIC insurance 1,220 1,313 1,458 1,344 1,140 3,991 3,657 Other operating expenses 13,398 14,016 13,979 14,402 13,594 41,393 41,519 Merger related expenses   1,840     -     -     2,878     -     1,840     -   Total non-interest expense   54,217     53,960     54,582     54,714     52,158     162,759     156,609   Income before income taxes 37,676 36,562 36,030 32,860 33,943 110,268 99,355 Income tax expense   9,800     9,324     9,303     8,383     8,623     28,427     25,126   NET INCOME $ 27,876   $ 27,238   $ 26,727   $ 24,477   $ 25,320   $ 81,841   $ 74,229     PER SHARE Basic earnings $ 0.20 $ 0.19 $ 0.19 $ 0.17 $ 0.18 $ 0.58 $ 0.53 Diluted earnings $ 0.20 $ 0.19 $ 0.19 $ 0.17 $ 0.18 $ 0.58 $ 0.53 Adjusted diluted earnings $ 0.21 $ 0.19 $ 0.19 $ 0.18 $ 0.18 $ 0.59 $ 0.53 Average shares - basic 140,235,094 140,126,314 142,911,230 145,277,964 139,275,683 141,081,076 139,934,960 Average shares - diluted 140,916,194 140,752,713 143,513,420 145,850,861 139,825,134 141,717,928 140,466,437   SUPPLEMENTAL DATA (annualized, average) Return on assets 1.16 % 1.14 % 1.14 % 1.05 % 1.17 % 1.15 % 1.16 % Adjusted return on assets (3) 1.22 % 1.14 % 1.14 % 1.14 % 1.17 % 1.17 % 1.16 % Return on shareholders' equity 9.69 % 9.66 % 9.45 % 8.30 % 9.11 % 9.60 % 9.07 % Return on tangible common equity (1) 13.30 % 13.32 % 12.96 % 11.09 % 11.97 % 13.19 % 11.95 % Adjusted return on tangible common equity 13.94 % 13.32 % 12.96 % 12.02 % 11.97 % 13.41 % 11.95 % Efficiency ratio (4) 54.23 % 56.59 % 57.10 % 54.53 % 57.29 % 55.97 % 57.95 %                                 (3) RECONCILIATION TABLE FOR NON-GAAP FINANCIAL MEASURES   Adjusted net income reconciliation Net income $ 27,876 $ 27,238 $ 26,727 $ 24,477 $ 25,320 $ 81,841 $ 74,229 After tax merger related expenses   1,350     -     -     2,054     -     1,350     -   Adjusted net income $ 29,226   $ 27,238   $ 26,727   $ 26,531   $ 25,320   $ 83,191   $ 74,229     Adjusted diluted earnings per share reconciliation Diluted earnings per share $ 0.20 $ 0.19 $ 0.19 $ 0.17 $ 0.18 $ 0.58 $ 0.53 After tax merger related expenses   0.01     -     -     0.01     -     0.01     -   Adjusted diluted earnings per share $ 0.21   $ 0.19   $ 0.19   $ 0.18   $ 0.18   $ 0.59   $ 0.53     Adjusted net income $ 29,226 $ 27,238 $ 26,727 $ 26,531 $ 25,320 $ 83,191 $ 74,229 Average assets $ 9,526,850 $ 9,544,673 $ 9,524,279 $ 9,269,113 $ 8,569,734 $ 9,531,944 $ 8,521,085 Adjusted return on average assets (annualized) 1.22 % 1.14 % 1.14 % 1.14 % 1.17 % 1.17 % 1.16 %   (4) RECONCILIATION TABLE FOR NON-GAAP FINANCIAL MEASURES   Efficiency ratio calculation Non-interest expense $ 54,217 $ 53,960 $ 54,582 $ 54,714 $ 52,158 $ 162,759 $ 156,609 Less: Merger related expenses   1,840     -     -     2,878     -     1,840     -   Operating expenses $ 52,377   $ 53,960   $ 54,582   $ 51,836   $ 52,158   $ 160,919   $ 156,609     Net interest income (taxable equivalent) $ 71,563 $ 70,660 $ 72,654 $ 71,641 $ 68,166 $ 214,877 $ 201,509   Non-interest income 25,026 24,687 22,930 23,430 22,871 72,643 68,745 Less: Net gains on investment securities   -     -     -     13     -     -     8   Adjusted revenue $ 96,589   $ 95,347   $ 95,584   $ 95,058   $ 91,037   $ 287,520   $ 270,246     Efficiency ratio 54.23 % 56.59 % 57.10 % 54.53 % 57.29 % 55.97 % 57.95 %     Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2015                 Unaudited, dollars in thousands except share and per share data   For the Quarter Ended For the Nine Months Ended 9/30/2015 6/30/2015 3/31/2015 12/31/2014 9/30/2014 9/30/2015 9/30/2014 CHARGE-OFFS Loan charge-offs $ 4,418 $ 7,789 $ 3,074 $ 3,781 $ 3,097 $ 15,281 $ 13,240 Recoveries on loans   (1,750 )   (1,876 )   (1,128 )   (2,029 )   (1,176 )   (4,754 )   (3,549 ) Net loan charge-offs $ 2,668   $ 5,913   $ 1,946   $ 1,752   $ 1,921   $ 10,527   $ 9,691   Net loan charge-offs to average total loans (annualized) 0.17 % 0.39 % 0.13 % 0.12 % 0.14 % 0.23 % 0.24 %   NET CHARGE-OFF DETAIL Commercial and industrial loans $ 1,444 $ 4,874 $ 422 $ (537 ) $ 19 $ 6,740 $ 3,218   Commercial real estate-permanent (58 ) (308 ) 601 245 1,072 235 2,094 Commercial real estate-construction   (196 )   (92 )   (95 )   (628 )   (221 )   (383 )   (101 ) Total commercial real estate loans (254 ) (400 ) 506 (383 ) 851 (148 ) 1,993   Residential mortgages 598 70 248 1,139 138 916 1,981 Home equity lines and loans 407 1,064 230 723 355 1,701 1,528 All other consumer loans   473     305     540     810     558     1,318     971   Total consumer loans   1,478     1,439     1,018     2,672     1,051     3,935     4,480     Net loans charged-off $ 2,668   $ 5,913   $ 1,946   $ 1,752   $ 1,921   $ 10,527   $ 9,691     As of 9/30/2015 6/30/2015 3/31/2015 12/31/2014 9/30/2014 ASSET QUALITY AND OTHER DATA Non-accrual commercial and industrial loans $ 6,234 $ 8,923 $ 21,107 $ 21,931 $ 11,205   Non-accrual commercial real estate-permanent 7,068 7,160 6,781 7,915 2,887 Non-accrual commercial real estate-construction   8,504     8,443     8,204     8,113     8,547   Total non-accrual commercial real estate loans 15,572 15,603 14,985 16,028 11,434   Non-accrual residential mortgages 8,171 8,307 8,326 7,706 6,803 Non-accrual home equity lines and loans 4,234 4,027 3,762 3,426 3,961 All other non-accrual consumer loans   1,387     1,387     1,458     1,746     1,467   Total non-accrual consumer loans 13,792 13,721 13,546 12,878 12,231           Total non-accrual loans 35,598 38,247 49,638 50,837 34,870   Restructured loans   9,047     8,792     8,557     8,255     7,996   Total non-performing loans 44,645 47,039 58,195 59,092 42,866   Acquired other real estate owned 3,450 3,450 3,450 3,675 - Other real estate owned and repossessed assets   1,269     1,736     2,024     1,192     1,561   Total other real estate owned and repossessed assets   4,719     5,186     5,474     4,867     1,561   Total non-performing assets 49,364 52,225 63,669 63,959 44,427   Loans 90+ days past due & still accruing   1,752     1,903     2,230     2,183     2,961   Total non-performing assets and loans 90+ days past due $ 51,116   $ 54,128   $ 65,899   $ 66,142   $ 47,388     Allowance for loan losses $ 83,148   $ 84,816   $ 89,729   $ 90,675   $ 88,927   Allowance for loan losses/non-performing loans   186.2 %   180.3 %   154.2 %   153.4 %   207.5 %

Allowance for loan losses/non-performing assets and loans 90+ days past due (excluding acquired other real estate owned)

  174.4 %   167.4 %   143.7 %   145.2 %   187.7 %

Allowance for loan losses/non-performing assets and loans 90+ days past due

  162.7 %   156.7 %   136.2 %   137.1 %   187.7 % Allowance for loan losses/total originated loans   1.46 %   1.50 %   1.61 %   1.63 %   1.63 % Allowance for loan losses/total loans   1.35 %   1.37 %   1.46 %   1.48 %   1.63 % Provision/charge-offs, net   37.5 %   16.9 %   51.4 %   199.8 %   52.1 %     Originated classified loans $ 124,438 $ 124,837 $ 142,892 $ 153,255 $ 169,790 Acquired classified loans   1,121     2,671     1,715     9,534     -   Total classified loans $ 125,559   $ 127,508   $ 144,607   $ 162,789   $ 169,790     Originated classified loans/total originated loans   2.19 %   2.21 %   2.56 %   2.75 %   3.10 % Total classified loans/total loans   2.04 %   2.07 %   2.36 %   2.65 %   3.10 % Delinquent loans (a) $ 21,293   $ 16,943   $ 15,968   $ 22,300   $ 20,171   Delinquent loans/total loans   0.35 %   0.27 %   0.26 %   0.36 %   0.37 % Non-performing loans/total loans   0.72 %   0.76 %   0.95 %   0.96 %   0.78 %   REGULATORY CAPITAL DATA (b) Tier 1 capital $ 925,046   $ 906,281   $ 887,854   $ 963,629   $ 927,023   Common equity tier 1 capital   855,130     838,602     822,511       Total capital   1,008,194     991,097     976,043     1,050,295     1,005,629   Risk-weighted assets   6,969,855     6,953,013     7,053,656     6,929,235     6,278,140   Tier 1 leverage ratio   10.06 %   9.85 %   9.67 %   10.78 %   11.18 % Tier 1 ratio   13.27 %   13.03 %   12.59 %   13.91 %   14.77 % Common equity tier 1 ratio   12.27 %   12.06 %   11.66 %     Total capital ratio   14.47 %   14.25 %   13.84 %   15.16 %   16.02 %   (a) Includes loans 30-89 days past due and loans 90+ days past due and still accruing (b) 2015 Regulatory Capital Data calculated in accordance with BASEL III                       Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2015     Unaudited, dollars in thousands except share and per share data As of Earning Assets / Liabilities 9/30/2015 6/30/2015 3/31/2015 12/31/2014 9/30/2014

Loan portfolio composition (regulatory):

Commercial / industrial $ 875,974 $ 890,890 $ 895,356 $ 852,804 $ 804,283 Commercial real estate (c) 2,293,076 2,281,023 2,186,626 2,172,858 1,994,773 Residential mortgage 1,464,554 1,471,769 1,508,968 1,550,378 1,181,503 Real estate construction and land development 200,645 188,473 229,428 261,916 260,054 Home equity 876,219 874,386 867,784 875,903 817,723 Consumer 253,711 246,645 238,320 239,807 224,614 Other   204,349   215,295   204,962   192,791   186,892 Total 6,168,528 6,168,481 6,131,444 6,146,457 5,469,842   Investment securities and other securities 2,503,203 2,507,615 2,537,170 2,519,215 2,381,751 Other earning assets   119,616   118,375   131,166   303,055   98,512 Total earning assets (net of loan loss reserve) $ 8,708,199 $ 8,709,655 $ 8,710,051 $ 8,878,052 $ 7,861,178  

Loan portfolio composition (internal):

Commercial & industrial Business purpose, real estate secured $ 940,869 $ 922,413 $ 918,985 $ 929,999 $ 897,812 Business purpose, not secured by real estate 1,030,537 1,054,746 1,046,875 995,051 944,207 Commercial real estate (owner occupied) Permanent 654,178 658,457 635,880 623,712 566,007 Construction / development 39,119 35,006 53,635 51,105 49,826 Leasing   -   -   -   -   18 Total commercial & industrial 2,664,703 2,670,622 2,655,375 2,599,867 2,457,870   Commercial real estate (non-owner occupied) Permanent 1,291,107 1,291,059 1,226,847 1,229,318 1,086,346 Construction / development   145,975   137,351   169,271   203,542   208,728 Total commercial real estate   1,437,082   1,428,410   1,396,118   1,432,860   1,295,074 Total commercial 4,101,785 4,099,032 4,051,493 4,032,727 3,752,944   Consumer Residential mortgage (personal purpose) Permanent 852,672 856,976 869,562 893,732 644,919 Construction   9,851   10,192   15,384   14,625   16,004 Total residential mortgages 862,523 867,168 884,946 908,357 660,923   Home equity and direct installment 210,455 223,573 239,903 253,358 162,188 Home equity lines of credit   693,674   679,754   661,368   660,472   614,298 Total home equity 904,129 903,327 901,271 913,830 776,486   Private banking credit lines 87,556 90,946 90,919 96,689 95,049 Indirect vehicle and other   206,296   198,315   191,576   190,676   180,550 All other consumer   293,852   289,261   282,495   287,365   275,599 Total consumer   2,060,504   2,059,756   2,068,712   2,109,552   1,713,008   Loans 6,162,289 6,158,788 6,120,205 6,142,279 5,465,952   Loans held-for-sale 6,239 9,693 11,239 4,178 3,890                     Total loans $ 6,168,528 $ 6,168,481 $ 6,131,444 $ 6,146,457 $ 5,469,842  

Deposit composition:

Savings $ 711,544 $ 722,051 $ 711,375 $ 678,294 $ 544,625 NOW accounts 2,166,339 1,886,405 1,880,649 1,913,399 1,981,608 Money market accounts 1,746,808 1,734,059 1,755,276 1,827,233 1,658,815 Time deposits less than $100k 838,417 859,472 872,906 891,964 797,535 Time deposits $100k or greater   326,245   330,866   334,864   333,697   314,915 Total interest bearing deposits 5,789,353 5,532,853 5,555,070 5,644,587 5,297,498   Non-interest bearing deposits   1,169,922   1,200,631   1,142,192   1,085,158   990,438   Total deposits $ 6,959,275 $ 6,733,484 $ 6,697,262 $ 6,729,745 $ 6,287,936   (c) Includes owner occupied                                                           Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2015     Unaudited, dollars in thousands except share and per share data Quarterly, as of Nine Months, as of 9/30/2015 6/30/2015 3/31/2015 12/31/2014 9/30/2014 9/30/2015 9/30/2014 Avg Bal Yield Avg Bal Yield Avg Bal Yield Avg Bal Yield Avg Bal Yield Avg Bal Yield Avg Bal Yield   Total loans* $ 6,144,998 3.90 % $ 6,146,507 3.83 % $ 6,131,280 3.91 % $ 5,932,806 3.96 % $ 5,406,073 4.00 % $ 6,140,979 3.88 % $ 5,370,019 4.00 % Investment securities* 2,498,640 3.14 % 2,515,825 3.26 % 2,529,343 3.52 % 2,470,862 3.32 % 2,400,867 3.43 % 2,514,490 3.30 % 2,408,042 3.51 % Interest earning deposits   91,720 0.16 %   92,867 0.17 %   97,917 0.16 %   124,710 0.18 %   85,310 0.15 %   94,145 0.16 %   73,940 0.16 %   Total earning assets   8,735,358 3.64 %   8,755,199 3.63 %   8,758,540 3.75 %   8,528,378 3.72 %   7,892,250 3.79 %   8,749,614 3.68 %   7,852,001 3.82 % Total assets   9,526,850   9,544,673   9,524,279   9,269,113   8,569,734   9,531,944   8,521,085   Savings 716,540 0.10 % 714,135 0.10 % 693,482 0.11 % 638,913 0.10 % 549,589 0.10 % 708,136 0.10 % 544,929 0.10 % NOW accounts 2,012,605 0.14 % 1,908,400 0.14 % 1,864,261 0.14 % 1,987,346 0.15 % 1,845,595 0.15 % 1,928,966 0.14 % 1,728,089 0.14 % Money market accounts 1,746,975 0.22 % 1,761,906 0.22 % 1,836,268 0.22 % 1,788,019 0.22 % 1,681,361 0.22 % 1,781,389 0.22 % 1,679,955 0.22 % Time deposits   1,174,011 0.97 %   1,199,076 0.94 %   1,210,270 0.90 %   1,210,685 0.88 %   1,132,513 0.96 %   1,194,320 0.94 %   1,181,590 1.02 %   Total interest bearing deposits   5,650,131 0.33 %   5,583,517 0.33 %   5,604,281 0.33 %   5,624,963 0.33 %   5,209,058 0.34 %   5,612,811 0.33 %   5,134,563 0.36 %   Non-interest bearing deposits   1,179,132   1,143,551   1,091,409   1,078,218   1,005,457   1,138,352   993,372 Total deposits   6,829,263 0.28 %   6,727,068 0.28 %   6,695,690 0.27 %   6,703,181 0.27 %   6,214,515 0.29 %   6,751,163 0.27 %   6,127,935 0.30 %   Customer repurchase agreements 551,603 0.29 % 556,813 0.29 % 568,750 0.29 % 589,944 0.29 % 546,119 0.29 % 558,992 0.29 % 544,500 0.29 % Repurchase agreements - 0.00 % - 0.00 % - 0.00 % - 0.00 % 16,032 4.87 % - 0.00 % 38,553 4.87 % Federal Home Loan Bank advances and other borrowings 702,424 0.91 % 824,456 0.81 % 805,516 0.80 % 503,081 1.10 % 505,349 1.02 % 777,088 0.84 % 541,108 1.04 % Senior long-term debt 125,000 4.34 % 125,000 4.38 % 125,000 4.43 % 125,000 4.33 % 20,380 4.42 % 125,000 4.38 % 6,868 4.42 % Subordinated debentures   77,321 2.81 %   77,321 2.79 %   77,321 2.76 %   77,321 2.75 %   77,321 2.75 %   77,321 2.79 %   77,321 2.75 % Total deposits and borrowings   8,285,611 0.41 %   8,310,658 0.41 %   8,272,277 0.41 %   7,998,527 0.41 %   7,379,716 0.38 %   8,289,564 0.41 %   7,336,285 0.41 % Total interest bearing liabilities $ 7,106,479 0.48 % $ 7,167,107 0.48 % $ 7,180,868 0.48 % $ 6,920,309 0.48 % $ 6,374,259 0.44 % $ 7,151,212 0.48 % $ 6,342,913 0.48 %   Net interest margin (FTE) 3.25 % 3.24 % 3.36 % 3.33 % 3.43 % 3.28 % 3.43 %   Wealth assets under management, at period end $ 2,517,888 $ 2,587,907 $ 2,609,834 $ 2,501,015 $ 2,411,463   *Fully taxable equivalent ("FTE") basis, using a 35% statutory tax rate     Financial Update for National Penn Bancshares, Inc. (NPBC) for 9/30/2015                     Unaudited   STATES OF OPERATION AND BANKING OFFICES BY STATE (LATEST AVAILABLE DATA)   Quarterly, as of 9/30/2015 6/30/2015 3/31/2015 12/31/2014 9/30/2014  

PA

Total number of retail branch offices 116 116 119 119 110 Total number of insured subsidiaries (Bank & Thrift subsidiaries) 1 1 1 1 1 Total number of ATMs 127 126 128 127 120  

NJ

Total number of retail branch offices 7 7 7 7 - Total number of insured subsidiaries (Bank & Thrift subsidiaries) - - - - - Total number of ATMs 6 6 6 6 -

 

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 124 124 127 127 111 Total number of insured subsidiaries (Bank & Thrift subsidiaries) 1 1 1 1 1 Total number of ATMs 134 133 135 134 121   EOP employees (full-time equivalent) 1,548 1,573 1,596 1,658 1,549  

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National Penn Bancshares, Inc.Investor Contact:Michael J. Hughes, 484-709-3305michael.hughes@nationalpenn.comorMedia Contact:Jacklyn Bingaman, 610-674-1325jacklyn.bingaman@nationalpenn.com