National Penn Bancshares' (NPBC) CEO Scott Fainor on Q2 2014 Results - Earnings Call Transcript

Jul.24.14 | About: National Penn (NPBC)

National Penn Bancshares (NASDAQ:NPBC)

Q2 2014 Earnings Conference Call

July 24, 2014 1:00 PM ET

Executives

Scott Fainor – President and CEO

Mike Hughes – Senior EVP and CFO

Sandy Bodnyk – Senior EVP and Chief Risk Officer

Dave Kennedy – Senior EVP and Chief Banking Officer

Analysts

Bob Ramsey – FBR Capital Markets

Casey Haire – Jefferies LLC

Damon DelMonte – KBW

Dave Bishop – Drexel Hamilton

Matthew Kelly – Sterne, Agee

David Darst – Guggenheim Securities

Frank Schiraldi – Sandler O’neill + Partners, L.P.

Operator

Good afternoon, everyone, and welcome to National Penn Bancshares’ Second Quarter 2014 Earnings Conference Call and Webcast. Please note that this call is being recorded. All callers will be in a listen-only mode during the prepared remarks. At the end of the prepared remarks, there will be a live question-and-answer session with analysts.

This call and the accompanying presentation slides located on National Penn’s Investor Relations website at www.nationalpennbancshares.com will be archived on the site following this call. The slides will also be furnished on SEC Form 8-K. National Penn’s earnings release was posted earlier today to National Penn’s Investor Relations website and will also be furnished following this call to the SEC on a Form 8-K.

Certain statements on this call may constitute forward-looking statements under Securities Laws. National Penn makes these statements on the basis of their views and assumptions regarding future events and the business performance at the time they make them and the National Penn does not undertake any obligation to update these statements.

Forward-looking statements are subject to a number of risks and uncertainties and actual results may differ materially from the results expressed or implied in light of a variety of factors including factors contained in the slides to this presentation in National Penn’s annual report on Form 10-K and the National Penn’s other filings with the Securities and Exchange Commission.

In addition, please note that a reconciliation of non-GAAP measures that are referred to on this call to equivalent GAAP measures can be found in the slides to this presentation.

It is now my pleasure to turn the conference over to National Penn’s President and CEO, Scott Fainor.

Scott Fainor

Thank you for joining our second quarter 2014 earnings webcast conference call today. I am joined by Mike Hughes, our Chief Financial Officer; Sandy Bodnyk, our Chief Risk Officer; and Dave Kennedy, our Chief Banking Officer.

I’d like you to refer to Slide 4 of our presentation today. This outlines some of the highlights of our strong second quarter financial performance.

National Penn is very pleased to announce an earnings per share increase in the quarter of 19% to $0.19 per share compared to the first quarter of 2014. This is another quarter, a very consistent financial performance with a strong return on assets of 1.23%.

Quality loan growth remained a top priority for us and we’re able to grow 3% since the second quarter of 2013 driven by narrowly by growth in our commercial loan segment.

Pipelines remain strong and we know that we need to have to have these pipelines materialized even further in the second half of 2014 and we will remain focused on quality, profitability of these loans that we booked to our portfolios. That leads me to once again talk about our strong credit quality and this remains the story at National Penn.

Total nonperforming loans declined 10% from the first quarter and 22% since June 30, 2013. We continue our focus on growing fee income and non-interest income in our fee income businesses increased compared to the first quarter of 2014 and Mike will speak more about that.

The strength of our balance sheet coupled with the strength of these second quarter earnings allowed National Penn to once again declare a third quarter 2014 cash dividend of $0.10 per share.

On Slide #5 in the presentation, I wanted to take a moment to update all of you on our early June 2014 announcement to acquire TF Financial Corporation and 3rd Fed Bank. This acquisition as we stated is consistent with our previously discussed acquisition strategy. It further leverages our capital base and it enhances franchise value by strengthening our Bucks County and Philadelphia’s presence where we currently operate. And it helps us to expand National Penn further into New Jersey.

TF Financial with over $800 million in assets has a conservative risk profile. And we are on track with our regulatory filings and upon receiving all approvals are bullish to close the transaction and convert the systems by the end of the fourth quarter in 2014. These all will lead us to accretion to our earnings per share of $0.04.

I’d like to now turn this presentation over to Mike Hughes. Mike?

Mike Hughes

Thanks, Scott. As Scott mentioned, I’ll start on Slide #6. You can see the EPS at $0.19 versus $0.16 in the prior quarter, ROA of 1.23% for the quarter, 1.16% for the six months. So when you look across that slide, I think what you see is consistency at a high level of performance.

On Slide #7, the margin for the quarter 3.43% compared to 3.44% in the first quarter, it’s consistent with our prior guidance and our goal remains to keep that margin in the 3.45% range for the year.

With our liquidity and loan to the price ratio below 90%, this allows us to be disciplined in deposit pricing strategies.

Looking at Slide #8 as it relates to loan growth, again, our goal has been and continues to be loan single-digit loan growth, loans going 3% year-over-year, 2% in the quarter. Would we like to see a little bit more loan growth, we would. We think the market is what it is and as we try to take some share, we’re going to be disciplined in our approach.

I would mention as it relates to commercial loans, there were a couple of larger credit that reduced their working capital line by about $15 million in the quarter. But we did have some favorable experience on the consumer side and as you can see prepayment speeds in the mortgage side have slowed allowing us to accrete those balances in some way.

On Slide #9, we had no provision in the quarter. The asset quality metrics improved. If you look at that, that’s over a long period of time classified loan. It’s been down for about 18 consecutive quarters and that provision over the last two-and-a-half years has been in the $1 million to $2 million range. What happened in this quarter, nonperforming loans declined by 10%. The specific reserve related to those loans also declined. Net charge-off declined from $4.5 million to $3.4 million and you can see the trend on the upper right, that data is the focus of ours to reduce the net charge-off number.

And on the lower left, reserves to nonperforming loans despite no provision over 200% relatively higher than the peer group.

Looking at other income on Slide #10, wealth management continuous to perform well, the pricing [ph] service charging gets the benefit of seasonality, bounces back a little bit from the first quarter.

Swap income improves by $1 million and that really was related to our loan volumes with a gain as we mentioned on the sale of nonperforming loans of $1 million. That gain was related to consumer loans.

Operating expenses on Slide #10. We continue to control our operating expenses well, efficiency ratio of 57% and the restructuring charge, we realized the benefits.

Capital levels illustrate the profile [ph] in the act of the TF acquisition. The 60/40 structure was to leverage the capital base and it did. Our focus is to enhance capital at the holding company level to support strategic flexibility. So we’re looking at securing debt at the holding company level in the future based upon the rate in [indiscernible] and current credit spreads. Such funding of secured would be used for capital management strategies including acquisition activity.

And with that, I will turn it back to Scott.

Scott Fainor

Thank you, Mike. In summary for the second quarter of 2014, we remained focus at National Penn on building long-term shareholder value.

And Slide #13 of our presentation outlines these accomplishments for the quarter and the year and the high levels of financial performance that have been delivered by our company.

We continue to execute in a disciplined manner on our capital management strategies as outlined on this slide. We remained focus on both strong asset quality trends as we have in the past and also, managing our expenses. This has been a long-term history and we’re going to continue to focus on expense management in the future.

We executed on all of our previously announced expense reduction initiatives, all of these being completed early in the second quarter. We stated in the first quarter as I believe you remember that we weren’t satisfied with our fee income results during at that time.

However, the National Penn maintained our focus on all fee income categories and we delivered solid results as Mike had stated for the second quarter.

This is exactly why I continue to remain encouraged and optimistic in our higher level of loan pipelines at National Penn. These loan pipelines coupled with our focus banking teams need to convert the pipelines into quality, closed, booked loans onto our balance sheet and we need to deliver on this and we know it and it’s a priority.

While we are executing on our single-digit loan growth loans, we remain however disciplined on credit and rate risk policies. Our organic growth coupled with our acquisition of a quality organization like TF Financial, both of these things together are going to continue to allow National Penn to deliver quality financial results throughout 2014 and position us well for 2015.

I’d like to now open up the line for any questions that you may have.

Question-and-Answer Session

Operator

Thank you. (Operator instructions) And our first question comes from the site of Bob Ramsey with FBR Capital Markets. Your line is now open.

Bob Ramsey – FBR Capital Markets

Hey, good afternoon. I was curious – hey, I was curious if you could quantify – maybe I missed it, but MTL [ph] loan sale, how big was the portfolio was sold or the loan that was sold?

Mike Hughes

The MTLs [ph] were primarily consumer loans. It was about a $5 million contractual balance. We had that in March, so it was relatively small sale. It’s something we do in the ordinary course. We got better execution. We usually do them intra quarter. This happened to go over the end of a quarter.

Bob Ramsey – FBR Capital Markets

Okay, got it. And then, obviously, the credit metrics looks good. As you highlighted, your reserves are really big relative to your nonperformers and credit trends are heading the right direction. Do you anticipate needing any provision this year or do you think that you’ll be able to keep the provision like this quarter basically zero?

Mike Hughes

As we’ve said previously, Bob, a lot of moving parts as we relate to that classified criticized level of that net charge-off. And what would be great for us is to see some loan volume where actually we needed a provision.

So as we’ve said, the three factors that come in there is level of net charge-offs, level of long growth and classified. So it’s been modest over time. We think it will hopefully remain modest, but I would say be at this level.

Bob Ramsey – FBR Capital Markets

Okay. And then I know you mentioned as well on the call that you all are contemplating a debt issue which could be used down the road for acquisitions and capital management. Just curious, why you all would do that in advance of a deal and I guess even so I look at your balance sheet as it stands today and you’ve got lots of what I would consider excess common equity. Why the need for that?

Mike Hughes

Yes, I’d say two things, Bob. When you look at the market and you look at the rate environment, what’s happened with credits spread for financial institutions, we think from a market perspective it may be a good time to look at that.

But the second thing I’d say is that despite the capital levels we’re looking at liquidity at the holding company level to position us when and if there’s an acquisition or for other capital management strategies. So to try to pick the right time at the perfect time, we’re just – we believe the conditions are great right now.

Scott Fainor

And just to add to Mike’s point, we have continued to talk on these quarterly calls about capital management strategies in general. And I think this is one piece of that puzzle that we’ll continue to evaluate.

Bob Ramsey – FBR Capital Markets

And do you have a sort of targeted size range or what do you guys are contemplating on the debt thought?

Scott Fainor

Bob, we’re not at a point right now where we’re going to quantify that.

Bob Ramsey – FBR Capital Markets

Okay, great. Thank you guys, I’ll hop out.

Scott Fainor

Thanks, Bob.

Operator

And our next question comes from the site of Casey Haire with the Jefferies. Your line is open.

Casey Haire – Jefferies LLC

Hey, good morning, guys.

Scott Fainor

Hey, how are you?

Casey Haire – Jefferies LLC

Doing well, thanks. So just following up on I guess on Bob’s question on the credit. Assuming loan growth kind of stays where it is in low single digit rate and the migration trends continue maybe charge-offs run a little bit lower. I’m just curious would that, if the metrics supported it, if everything kind of came together, would that prevent you from putting up a provision credit?

Scott Fainor

Again, Casey, I mean we’ll look at this scenario. It’s very formulaic, our approach to the reserve based upon performing loan as well as not performing in classified. And whether we would at some point in time have a negative provision would be dictated by the facts and circumstances.

Casey Haire – Jefferies LLC

Okay. And then just switching gears here on the expense front, obviously, another – a good result here down on the quarter. Just curious as you guys with the TFTL [ph], you’re going to be getting closer and closer to that $10 million mark which obviously comes with an increased regulatory expense burden. Just curious how was – are you comfortable with your balance in terms managing efficiency as well as investing for being above $10 billion?

Mike Hughes

Well, as we’ve said in that transaction, we announced that we do think we’ll get some synergies in the 40% range. We think we’ll be able to leverage the operated expense basis to some extent.

We go over 10 billion, there would some incremental regulatory expense related there too. We really haven’t quantified what that would be. But as we’ve said strategically we believe this company will go over to $10 billion, go over in a meaningful way. And we’ll evaluate those expenses as needed.

Scott Fainor

And I think we’ve talked in previous calls and we’ll probably continue to talk about it in the future calls that our teams inside of National Penn continue to prepare for what the compliance and all of the testing that’s necessary with our regulators and what that will hold. So our preparedness will be at the forefront.

Casey Haire – Jefferies LLC

Okay, great. And then just lastly on the deal activity fund, I mean how is activity in your markets? Is it our sellers – is charter [ph] picking up so to speak?

Scott Fainor

There’s more conversations that continue to go on. Once again, we’re disciplined in our approach. We’re very pleased to have been able to announce the TF Financial deal. We’re focused on that deal to get our regulatory approvals. And to make sure that we bring that deal to close in the fourth quarter. So that’s where our focus is now but I do believe that there will be increased activity over time.

Casey Haire – Jefferies LLC

Okay, thank you.

Scott Fainor

Good, thank you.

Operator

And we’ll next go to the site of Damon DelMonte with KBW. Your line is open.

Damon DelMonte – KBW

Hey, good afternoon, guys. How are you?

Scott Fainor

Good.

Damon DelMonte – KBW

Just wanted to touch on the margin. Obviously, a very stable margin this quarter, and Mike I believe you said you guys are hoping to keep it in a mid 3.40 range. Can you just talk about some of the dynamics maybe behind that that are going to allow that? Is it going to be the low single-digit loan growth that you’re targeting or you have opportunity on the funding side?

Mike Hughes

I think, Damon, that’s the big one. Low single-digit loan growth has to materialize for us to get there. Do we have opportunity on the funding side? Well, if you look, we’re getting in the basis point here and there. We did see in the quarter some longer terms CDs come off that had a relatively high rate. These were five years CDs, so we’ve got some benefit there.

But on the funding side, it’s blocking and tackling. We do have a structured repo coming off in the quarter about $50 million that has a 4.80 [ph] type cost. So I think it is mainly focused on your earlier point which is loan volumes.

Scott Fainor

And, Damon, as Mike and I talked in our presentations, our low single-digit loan growth numbers continue to be maintained in a discipline fashion around credit and rate risk models. So we’re not really hearing from that which we hope we’ll continue to keep the margin in check.

Damon DelMonte – KBW

Okay. That’s helpful, thank you. And then I think you had mentioned that you had couple larger commercial relationship that had paid off or had matured or so during the quarter. Just out of curiosity, it seems like you guys continually are having loans that are paying off or that are maybe being refinanced away. Is that what the case is, that these loans that you are competing against the renewal or refinancing, and your choosing to let it go.

Scott Fainor

Yes, let me be clear. In Mike’s comments, he talked about that there were loans that reduced. So I just want to be clear, those relationships did not leave National Penn and did not pay off. There were lines of credits that reduced in some larger relationships.

So I think that speaks to the high level of loan quality that we’re putting on our balance sheet and that these companies have tremendous casual which then they’re using to reduce their line balances and at the same time they will also have the ability to increase those line balances. That’s a big difference from having customers pay loans down and pay them off.

Damon DelMonte – KBW

Got you, okay. That was helpful.

Mike Hughes

Those were reductions they were working capital lines, Damon. We’re hopeful at some point in time we’ll see some draws back on those lines but they – to Scott’s point, these are existing customers and remain customers.

Damon DelMonte – KBW

Got it, okay. Thank you for clarifying that, I’m assumed I misunderstood what was said.

Mike Hughes

That’s okay, Damon, no problem.

Damon DelMonte – KBW

And then I guess my last question, and I’m sorry if you guys had answered this or if this was asked, but did you guys give an indicated range of size in that potential sub debt offering?

Scott Fainor

We did not and we would not be sub debted [ph] to be senior at the holding company.

Damon DelMonte – KBW

Senior at the holding company, okay. All right, that’s all that I had. Thank you.

Scott Fainor

Thank you, Damon.

Operator

Thank you. And our next question comes from the site of Dave Bishop with Drexel Hamilton. Your line is open.

Dave Bishop – Drexel Hamilton

Hey, good morning, good afternoon.

Scott Fainor

Hello, Dave. Hello, Dave, how are you?

Dave Bishop – Drexel Hamilton

Doing well, doing well. Hey, quick question, I noticed a nice part [ph] there on the consumer home equity side there. Do you guys do anything in the market that are not running any local promotions there to have a little bit of growth through there and you’d be seeing anything under the consumer deposit.

Sandy Bodnyk

I think it’s a combination, Dave, of the consumer coming back a little bit, a little bit of seasonality. But we also have some assistance in place that are allowing us to do a more data mining and a little bit more marketing and I think that’s proved successful for us.

Dave Bishop – Drexel Hamilton

Got it. And then just circling back to the commercial line usage. Are you hearing anything from your customers regarding I guess, business conditions out there that gives you a little bit more optimism in terms of what the market can give you in terms of potential growth. So I’m just curious what you’re hearing on the commercial side from your borrowers?

Dave Kennedy

This is Dave Kennedy. We see some cautious optimism from our borrowers but it’s still a very slow pace recovery here in the Pennsylvania, eastern part of Pennsylvania. But we – as Scott had pointed out earlier, we have a numerous strong cash flow borrowers. And right now they’re in good position with cash flow. We do anticipate usage as the time goes on and they make further investments.

Dave Bishop – Drexel Hamilton

Great, thank you.

Scott Fainor

Thank you, Dave.

Operator

And our next question comes from the site of Matthew Kelley with Sterne Agee. Please go ahead, your line is open.

Matthew Kelly – Sterne, Agee

Yes, hi guys. Just on the – just specifically, and to quantify it, what is the utilization rate? What was the utilization rate on C&I loans in the second quarter and how is that compare to last year?

Mike Hughes

When we look at that line utilization across the board, it’s in that low 40% range. It’s very constant as Scott and Dave’s earlier point. We are hopeful that as this economy recovers we may see some more utilization. But really it’s been pretty constant in that low 40% range. Now, I would say down a little this quarter but not – at the percentage of the total, not significant.

Scott Fainor

I think the good news at National Penn is that as we’ve focused on high quality borrowers, we’ve been bringing in full relationships. And we were encouraged to see that some of this line of credit usage took place in several of the previous quarters. But these borrowers have very strong cash flows. And they’re going to be pay down and then borrow when they want to make future investments. And we’re hopeful that over time that utilization rate will increase slightly.

Matthew Kelly – Sterne, Agee

And what’s going on with your unused lines of credit and the C&I side and your ability to grow a new relationships? Can you talk about that?

Scott Fainor

We have been growing new relationships in C&I. I think you’ve seen that materialized in our numbers over the last several quarters. I do think once again as we stayed very disciplined on credit quality and also on rate risk, and quality was in the rates to our profitability modeling, I think that that’s going to mean that a borrower is going to have more cash on their balance sheets and is going to be able to use those working capital line, paying them down when in falls [ph] of cash come in. And then we’re hopeful that over time, the more of those relationships that we put on our books will create in that utilization rate to increase.

Matthew Kelly – Sterne, Agee

I got you. And then on your –

Scott Fainor

I’m very pleased, Matt, with the new relationships that we’re putting on the balance sheet in all of our segments, but especially in C&I.

Matthew Kelly – Sterne, Agee

Got it. Your securities portfolio ended the quarter with $2.4 billion. Just directionally, what should we see that do over the next year? Are you going to use that for liquidity to grow loans or stay flat or down?

Scott Fainor

Yes, I think that portfolio over the last several years has been relatively flat. And Matt to your point what we would hope is that as loan volumes materialized and loan demand materializes, we fund that through reducing the investment portfolio.

Matthew Kelly – Sterne, Agee

Got you. All right, thank you.

Scott Fainor

Thank you, Matt.

Operator

And our next question comes from the site of David Darst with Guggenheim Securities. Your line is open.

David Darst – Guggenheim Securities

Hey, good afternoon.

Scott Fainor

Hey, David. How are you today?

David Darst – Guggenheim Securities

Good. So, Scott I guess you seemed pretty willing and continue to have a desire to do more acquisitions. But how comfortable are you doing another one on in the next nine months and maybe having two integration occurring at the same time in early next year?

Scott Fainor

Well, I think that in my comments, I stated that as we continue to work with the regulators on receiving approval for TF Financial Corporation and then the TF Financial Corporation shareholders need to also vote on this transaction. We’ve been consistent to say that we look to close this in the fourth quarter.

Now something that maybe unique to National Penn in our disciplined approaches, and I think I said it in my comments in the presentation, we not only look to close the transaction in the fourth quarter. We also look to convert the systems in the fourth quarter. That would be our stated goal. So what that would mean is over the course of – and I think you just said nine months or so. We will actively look in a disciplined way for other banks to find National Penn as a good acquisition partner. And I think as we end up looking for those banks to join us, we can do that as a follow up very quickly behind that.

David Darst – Guggenheim Securities

Okay. Have you given us any – you may have said this and I missed it, but at what point in the fourth quarter will you close, is it mid quarter or end?

Scott Fainor

Our goal is to close by the end of the fourth quarter. That’s what we’ve stated.

David Darst – Guggenheim Securities

And then would you kind of –

Scott Fainor

Certainly, if it was sooner, we’ll have to access that at that time.

David Darst – Guggenheim Securities

Okay. And then, Mike, on the security’s portfolio, the yield has been pretty steady and actually up a little bit year-to-date. Are there any significant maturity dates or any prepayment speeds or anything changing that to result on us so you can decline that yield in the next couple quarters?

Mike Hughes

Well, if you look at it, David, and you’re right, it’s fairly [indiscernible] back is up and down a couple basis points to quarter. It’s influenced by prepayments speeds, number of days in the quarter, FHLB came out recently instituted a higher dividends. So we get some pluses and minuses. But overall, I’d say that the rate that we’re investing on is still in – I’m sorry. The rate we’re investing in is less than what’s coming off. So there’s some pressure in that portfolio.

David Darst – Guggenheim Securities

What’s your current average duration?

Mike Hughes

About four years.

David Darst – Guggenheim Securities

Okay, great. Thank you.

Mike Hughes

Thank you, David.

Operator

(Operator’s instruction) And we’d go next to the site of Frank Schiraldi with Sandler O’neill. Your line is open.

Frank Schiraldi – Sandler O’neill + Partners, L.P.

Good afternoon.

Scott Fainor

Good afternoon, Frank.

Frank Schiraldi – Sandler O’neill + Partners, L.P.

Just one additional question on acquisition strategy following TF. So I think you’ve said it before and you probably said during this call too, you don’t want to necessarily limp over the $10 billion mark. So look, thinking about acquisitions, it seems like a similar at least sized acquisition might be off the table. I’m just wondering what your – if you have updated parameters, if you could share with us following TF.

Scott Fainor

I think our parameters remain the same, a bank that would be $500 million or greater in market. Our contagious market is going to a pre-franchised value and risk profile would be somewhat analogous to ours, appreciative that it may not be the same with the ability to leverage the capital base in pre-earnings per share. So I don’t think, Frank you point maybe why you’re going to do that $500 million acquisition that takes over, probably not, but that our parameters stay the same.

Frank Schiraldi – Sandler O’neill + Partners, L.P.

Okay. And then just as you approach or as you go over $10 billion and then you do touch on us obviously some sort revenue issue and then I would think there’s additional expenses as well. So is that something you can prepare for in terms of bulking up, ratcheting up in advance to getting $10 billion and could that possibly go in investment in the company? Could that be a possible negative trend in efficiencies in the shorter-term?

Mike Hughes

Well we do believe for a company that’s under $10 billion we have invested in the risk infrastructure, some of the more sensitive various such as BSA, what we would say is we believe there’s incremental expense. So I think there would incremental expense and we looked at going over that $10 billion mark.

We are appreciative of the impact on interchange free income. We won’t panelize the deal quote-unquote, "that took us over that mark." So we will have some expense and at the end of the day, we’re hopeful with the synergies of the transaction that would take us over would keep efficiency is relatively in historic range. They’ve been a National Penn.

Scott Fainor

And yes, Frank, we’ve been talking about we can’t be afraid of crossing over the $10 billion mark. We just have to make sure that we prepare ourselves internally as Mike Hughes said with our risk management systems that we understand what will impact revenue around the Durbin Amendment.

But we’ve been preparing inside with looking at the fees charged on different accounts, how we drive more relationships on the transaction account side, how do we bundle products in regards to electronic banking products. And I think ultimately, we need to position National Penn for being able to get through the $10 billion mark in an effective and efficient way.

Frank Schiraldi – Sandler O’neill + Partners, L.P.

Okay. But it sounds like that it’s not necessarily any expense builds you could point to at this time ahead of getting to that $10 billion mark that might – now that you’re getting closer that might find themselves find their way into the income statement.

Scott Fainor

That’s correct.

Frank Schiraldi – Sandler O’neill + Partners, L.P.

Okay. All right, thank you.

Scott Fainor

Thanks, Frank.

Operator

(Operator’s instruction) We’ll pause just a moment to allow any additional questions to queue.

And it appears that we have no further questions at this time. I will now hand the call back over to Mr. Fainor for any closing remarks.

Scott Fainor

Well I want to thank everyone for joining our second quarter 2014 conference call today. We appreciate all of your expense – all of your questions. And we look-forward to talking with you next quarter or during the quarter and we want to wish everyone a great summer. And we know that we’ll all be talking soon. Thank you very, very much.

Operator

Thank you. And this concludes today’s presentation. You may disconnect at any time. Have a wonderful afternoon.

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National Penn Bancshares (NASDAQ:NPBC): Q2 EPS of $0.19 beats by $0.02. Revenue of $87.34M (-1.0% Y/Y) misses by $1.51M.