Penace

HP: 12,000,000 (99,999 Overkill)
MP: 999
Str: 255
Def: 240
Mag: 255
M.Def: 200
Agi: 255
Lck: 10
Eva: 0
Acc: 255
Steal: Elixir / Megalixir x1
Items: Master Sphere x3
Weapons Abilities: Break Damage Limit
Armour Abilites: Ribbon

Right/Left Arm

HP: 500,000 (99,999 Overkill)
MP: 999
Str: 200
Def: 200
Mag: 150
M.Def: 200
Agi: 150
Lck: 10
Eva: 120
Acc: 255
Steal: Dark Matter x1 / Master Sphere x1
Items: Dark Matter x1 / Master Sphere x1

You will need stats at the max of 255, with Luck of at least 120. HP should be at least 40,000. Take out the arms first to prevent him from doing Judgement Day, then focus on the main body. Use Attack Reels, Blitz Ace, and Trio of 9,999 to improve your chances. If you have time use Healing Water to restore all your HP. Make good use of Quick Hits and Twin/Three Stars to help preserve your MP levels.

I havn't beaten Penance, but I've been informed that after beating him he disappears and the game continues as normal, but don't take that information to be certain.