Harleysville National Bank Enters into Sale-Leaseback Arrangement for its Bank-o

Under the terms of the agreement, Harleysville National Bank will sell andsimultaneously enter into long-term operating leases with ARC; Harleysvillewill retain control of the properties. The bank anticipates no interruptionof service to customers or direct impact on the staff of these offices locatedthroughout Berks, Bucks, Lehigh, Montgomery, Northampton, and Carbon counties.The Agreement is expected to close on or before year-end 2007.

"The reallocation of our real estate assets to drive shareholder value isbut one initiative we are executing to deliver positive results in thischallenging banking environment. This strategic initiative will help ustranslate a large non-earning asset into an earning asset in the form ofloans, which can help bolster earnings and increase liquidity, positivelyimpacting our bottom line. In addition to the financial benefits, by allowingothers to own our real estate, we can focus on what we do best -- serving ourcustomers," said Paul D. Geraghty, President and CEO of HNBC.

The agreement provides that each lease will have an initial term rangingfrom five to fifteen years, commencing on the closing date for the Agreement,with options to renew on various terms for periods aggregating up to 45 years.

Harleysville National Corporation, with assets of $3.8 billion, is theholding company for Harleysville National Bank (HNB). Investment Managementand Trust Services are provided through Millennium Wealth Management, adivision of HNB, with assets under management of $3.3 billion. HarleysvilleNational Corporation stock is traded under the symbol "HNBC" and is commonlyquoted on the NASDAQ Global Select Market®. For more information, visit theHarleysville National Corporation website at .

This press release may contain forward-looking statements as defined inthe Private Securities Litigation Reform Act of 1995. Actual results andtrends could differ materially from those set forth in such statements due tovarious factors. Such factors include the possibility that increased demandor prices for the Corporation's financial services and products may not occur,changing economic and competitive conditions, technological developments, andother risks and uncertainties, including those detailed in the Corporation'sfilings with the Securities and Exchange Commission.