WAYNE, N.J., Jan. 25, 2018 /PRNewswire/ -- Valley National
Bancorp (NYSE:VLY), the holding company for Valley National
Bank, today reported net income for the fourth quarter of 2017 of
$26.1 million, or $0.09 per diluted common share, as compared to
the fourth quarter of 2016 earnings of $50.1
million, or $0.19 per diluted
common share, and net income of $39.6
million, or $0.14 per diluted
common share, for the third quarter of 2017. The fourth
quarter of 2017 results include $22.6
million of charges (representing a $0.09 per share decrease in earnings) from the
impact of the Tax Cuts and Jobs Act (Tax Act) and $1.4 million (or $1.0
million after-tax) of merger expenses related to the
USAmeriBancorp, Inc. ("USAB") acquisition effective January 1, 2018. Excluding these charges,
our adjusted net income was $49.7
million, or $0.18 per diluted
common share, for the fourth quarter of 2017. See the
"Consolidated Financial Highlights" tables below for the
reconciliation of this and other non-GAAP measures.
Net income for the year ended December 31, 2017 was
$161.9 million, or $0.58 per diluted common share, compared to 2016
earnings of $168.1 million, or
$0.63 per diluted common share. The
earnings for the year ended December 31, 2017 included the Tax
Act charge, $9.9 million
($5.7 million after-tax) related to
our LIFT earnings enhancement program and $2.6 million ($2.3
million after-tax) of USAB merger related expenses.
Excluding these charges, our adjusted net income was $192.5 million, or $0.69 per diluted common share for the year ended
December 31, 2017.
Key financial highlights for the fourth quarter:
- Net Interest Income: Net interest income on a tax
equivalent basis of $173.9 million
for the fourth quarter of 2017 increased $7.1 million as compared to the third quarter of
2017 largely due to our solid loan growth and higher commercial
loan fees.
- Net Interest Margin: Our net interest margin on a tax
equivalent basis increased 9 basis points to 3.17 percent in the
fourth quarter of 2017 as compared to 3.08 percent for the third
quarter of 2017. See the "Net Interest Income and Margin"
section below for more details.
- Loan Portfolio: Loans increased $130.1 million, or 2.9 percent on an annualized
basis, to approximately $18.3 billion
at December 31, 2017 from September 30,
2017 largely due to solid commercial, auto and consumer loan
volumes, partially offset by increased secondary residential
mortgage banking activity and a decline in construction loan
advances during the fourth quarter. See additional information
under the "Loans, Deposits and Other Borrowings" section
below.
- Credit Quality: Net loan recoveries totaled $772 thousand for the fourth quarter of 2017, and
represented our second consecutive quarter of net recoveries.
Due to the strong collections, net charge-offs for year ended were
only $2.1 million, or 0.01 percent of
average loans for year ended December 31, 2017. Non-accrual
loans also represented only 0.26 percent of total loans at
December 31, 2017.
- Efficiency Ratio: Excluding LIFT program expenses,
merger expense and amortization of tax credit investments (included
in non-interest expense), our (non-GAAP) adjusted efficiency ratio
was 57.44 percent for the fourth quarter of 2017 as compared to
59.21 percent for the third quarter of 2017.
- Tax Act: During the fourth quarter of 2017, we incurred
a $22.6 million charge due the impact
of the Tax Cuts and Jobs Act. Of the $22.6 million, $18.3
million relates to the estimated tax expense from the
re-measurement of net deferred tax assets and the remaining
$4.3 million is losses from
adjustments to low income housing and tax-advantaged renewable
energy investments included in non-interest expense.
Final financial results and other disclosures will be
reported in our Annual Report on Form 10-K for the year ended
December 31, 2017, and may differ
materially from the results and disclosures in this document due
to, among other things, the completion of final review procedures,
the occurrence of subsequent events, or the discovery of additional
information.
"Valley made substantial progress towards greater profitability
in 2017," said Ira Robbins, CEO and
President. "Excluding infrequent charges, our adjusted net income
for the fourth quarter of 2017 was up over 7 percent from the third
quarter of 2017, and our full-year 2017 adjusted net income
increased over 14 percent from 2016."
"Our previously announced LIFT initiative is well on track to
deliver on the targets we laid out during our second quarter of
2017 earnings call. The recently closed acquisition of USAB
has positioned us well to pursue strong organic growth in 2018 and
beyond. Furthermore, we made significant progress
implementing the first phase of our technology enhancements over
the course of 2017, which is already helping to improve customer
engagement. While there is still much heavy lifting to be
done, we are pleased with the strides we have made on our quest to
increase our relevance to our customers and the communities we
serve. We look forward to demonstrating consistent progress
as we achieve our strategic goals."
Net Interest Income and Margin
Net interest income on a tax equivalent basis totaling
$173.9 million for the fourth quarter
of 2017 increased $7.1 million and
$7.3 million as compared to the third
quarter of 2017 and fourth quarter of 2016, respectively.
Interest income on a tax equivalent basis increased $8.8 million to $222.5
million for the fourth quarter of 2017 as compared to the
third quarter of 2017 largely due to a 13 basis point increase in
the yield on average loans and an increase of $236.4 million in average loans. The
increase in loan yield was supplemented by a combined increase of
$2.2 million in periodic commercial
loan fee income related to derivative interest rate swaps executed
with customers and loan prepayment penalty fees as compared to the
third quarter of 2017, as well as higher interest accretion on
certain acquired PCI loan pools caused by improvements in
forecasted cash flows. Interest expense of $48.5 million for the three months ended
December 31, 2017 increased $1.7
million and $11.8 million from
the third quarter of 2017 and fourth quarter of 2016,
respectively. During the fourth quarter of 2017, our interest
expense on deposits increased by $2.2
million from the linked third quarter largely due to higher
rates on certain retail money market and time deposit
offerings. Interest expense on long-term borrowings also
increased $1.2 million in the fourth
quarter of 2017 as compared to the third quarter of 2017 due to an
increase of $312.2 million in the
average balances. Average long-term borrowings in the fourth
quarter of 2017 increased as compared to the third quarter of 2017
mostly due to new long-term FHLB borrowings replacing a portion of
our short-term borrowings that matured during the third and fourth
quarters of 2017. Both the interest expense on short-term
borrowings and average balances declined by $1.7 million and $526.4
million, respectively, during the fourth quarter of 2017 as
compared to the third quarter of 2017 due to the partial shift to
longer term funding and a reduction in borrowings due to the
success of our deposit gathering initiatives in the second half of
2017.
The net interest margin on a tax equivalent basis was 3.17
percent for the fourth quarter of 2017, an increase of 9 basis
points from 3.08 percent in the linked third quarter of 2017 and a
10 basis point decrease from 3.27 percent for the fourth quarter of
2016. The yield on average interest earning assets increased
by 11 basis points on a linked quarter basis. The higher
yield was mainly a result of the 13 basis point increase in the
yield on average loans to 4.28 percent for the fourth quarter of
2017. The overall cost of average interest bearing liabilities
increased by 3 basis points from 1.19 percent in the linked third
quarter of 2017. The increase was primarily due to a 4 basis
point increase in the cost of deposits. Our cost of deposits
totaled 0.65 percent for the fourth quarter of 2017 as compared to
0.61 percent for the three months ended September 30, 2017.
Non-Interest Income
Non-interest income increased $1.5
million to $27.6 million for
the three months ended December 31, 2017 from $26.1 million for the third quarter of 2017
mainly due to increases of $1.2
million and $855 thousand in
other income and net gains on sales of loans, respectively,
partially offset by moderate declines in several other
categories.
Non-Interest Expense
Non-interest expense increased $3.8
million to $136.3 million for
the fourth quarter of 2017 as compared to the third quarter of
2017. During the fourth quarter, the amortization of tax
credit investments increased by $11.9
million due to the timing of tax credits and $4.3 million in impaired investment charges
related to the Tax Act. Net occupancy and equipment expense
increased $1.1 million due to
moderate increases in depreciation, repairs and maintenance and
real estate tax expenses as compared to the third quarter of
2017. These increases were partially offset by decreases of
$5.4 million and $4.6 million in professional and legal fees and
salary and employee benefits, respectively, as compared to the
third quarter of 2017 largely due to charges related to LIFT
program in the third quarter (See "Earnings Enhancement Program"
section below for details). While salary and benefits
declined during the fourth quarter, the decrease was net of
additional salary and commissions expense related to investments in
human capital primarily within our technology and residential
mortgage consultant teams.
Earnings Enhancement Program
In the third quarter of 2017, we completed the idea generation
and approval phase of our company-wide earnings enhancement
initiative called LIFT. As a result of these efforts, we
currently expect to achieve approximately $22 million in total cost reductions and revenue
enhancements on an annualized pre-tax run-rate. Implementation of
the LIFT program resulted in employee severance and other
implementation costs totaling approximately $9.9 million ($5.8
million after-tax) during both the third quarter and the
year ended December 31, 2017. We
estimate an additional $1.1 million
of costs will be incurred during the planned implementation phase
of the initiative enhancements which are expected to be fully
phased-in by June 30, 2019.
Mostly during the second half of 2017, Valley implemented several
enhancements that resulted in pre-tax cost reductions of
$5.6 million. These reductions
are expected to be approximately $11.4
million on an annualized pre-tax basis beginning in the
first quarter of 2018.
Income Tax Expense
Income tax expense was $35.0
million for the fourth quarter of 2017 and reflected the
estimated impact of the Tax Act, consisting of an $18.3 million charge resulting from the
re-measurement of Valley's estimated net deferred tax asset as of
December 31, 2017. Excluding
the $18.3 million charge and the
$4.3 million impairment of tax credit
investments related to the Tax Act, the effective tax rate was 25.5
percent for the fourth quarter of 2017 as compared to 30.1 percent
and 26.8 percent for the third quarter of 2017 and fourth quarter
of 2016, respectively. For 2018, we currently estimate that
our effective tax rate will range from 21 percent to 23 percent
primarily reflecting the impacts of the Tax Act, tax-exempt income,
tax-advantaged investments and general business credits.
Loans, Deposits and Other Borrowings
Loans. Loans increased
$130.1 million to approximately
$18.3 billion at December 31,
2017 from September 30, 2017, net of
an $84.6 million decline in the PCI
loan portion of the portfolio. During the fourth quarter of
2017, Valley also originated $243
million of residential mortgage loans for sale (rather than
held for investment) and sold approximately $88 million of loans from the residential
mortgage loan portfolio. Loans held for sale totaled
$15.1 million and $13.3 million at December 31, 2017 and
September 30, 2017, respectively.
Total commercial and industrial loans increased $34.5 million from September 30, 2017 to approximately $2.7 billion at December 31, 2017 due to a
$44.4 million, or 7.1 percent on an
annualized basis, increase in the non-PCI loan portfolio, partially
offset by normal run-off in the PCI loan portfolio.
Total commercial real estate loans (excluding construction
loans) increased $145.7 million from
September 30, 2017 to $9.5 billion at December 31, 2017 mostly due
to a $202.0 million, or 9.7 percent
on an annualized basis, increase in the non-PCI loan
portfolio. The increase in non-PCI loans was mainly caused by
solid organic loan volumes in New
York, New Jersey and
Florida. The loan growth was
partially offset by a $56.3 million
decline in the acquired PCI loan portion of the portfolio and
non-PCI loan repayments, partly caused by our continued focus to
manage weaker credit relationships out of the portfolio.
Construction loans decreased $52.5
million to $851.1 million at
December 31, 2017 from September
30, 2017. The decrease was mainly due to completed
construction projects during the fourth quarter and a decline in
advances on new construction projects.
Total residential mortgage loans decreased $82.4 million, or 11.2 percent on annualized
basis, to approximately $2.9 billion
at December 31, 2017 from September 30,
2017 mostly due to a larger percentage of loans originated
for sale rather than investment and the portfolio loans sold during
the fourth quarter of 2017. Our growing team of home mortgage
consultants continued to produce strong origination volumes during
the fourth quarter. New and refinanced residential mortgage
loan originations were approximately $291
million for the fourth quarter of 2017 as compared to
$307 million for the third quarter of
2017. Of the $291 million in
total originations, $23.0 million, or
7.9 percent, represented new residential mortgage loans originated
in Florida.
Home equity loans totaling $446.3
million at December 31, 2017 decreased by $2.6 million as compared to September 30, 2017 largely due to PCI loan
repayment activity.
Automobile loans increased by $37.2
million, or 12.7 percent on an annualized basis, to
$1.2 billion at December 31,
2017 as compared to September 30,
2017. New auto loan origination volumes increased
approximately 11.4 percent during the fourth quarter of 2017 as
compared to the third quarter of 2017 largely due to solid indirect
auto application activity that has continued during the second half
of 2017 without change to our underwriting criteria. Our
Florida dealership network
contributed over $34 million in new
auto loans, representing approximately 21 percent of Valley's total
auto loan production for the fourth quarter of 2017, as compared to
approximately $25 million, or 17
percent, of Valley's total auto originations for the third quarter
of 2017.
Other consumer loans increased $50.2
million, or 29.6 percent on an annualized basis, to
$728.1 million at December 31,
2017 as compared to September 30,
2017 mainly due to continued growth and customer usage of
collateralized personal lines of credit.
Deposits. Total deposits increased $840.7 million, or 4.9 percent, to approximately
$18.2 billion at December 31,
2017 from September 30, 2017 mostly
due to increases in money market accounts and time deposits
resulting from ongoing retail and business account initiatives in
2017. Non-interest bearing deposit balances also increased
$125.6 million at December 31,
2017 as compared to September 30,
2017 primarily due to normal seasonal commercial account
activity. Non-interest bearing deposits; savings, NOW, money market
deposits; and time deposits represented approximately 29 percent,
52 percent and 19 percent of total deposits as of December 31,
2017, respectively. The composition of deposits based upon
the period end balances remained relatively unchanged at
December 31, 2017 as compared to September 30, 2017.
Other Borrowings. Short-term borrowings decreased
$734.1 million, or 49.5 percent, to
approximately $748.6 million at
December 31, 2017 from September 30,
2017 mostly due to lower levels of short-term FHLB
borrowings caused by the success of our current deposit gathering
initiatives, and a partial shift to long-term borrowings in the
fourth quarter. As a result, long-term borrowing increased
$100.6 million, or 4.5 percent, to
$2.3 billion at December 31,
2017 from September 30, 2017.
Credit Quality
Non-Performing Assets. Our past due loans and
non-accrual loans discussed further below exclude PCI loans. Under
U.S. GAAP, the PCI loans (acquired at a discount that is due, in
part, to credit quality) are accounted for on a pool basis and are
not subject to delinquency classification in the same manner as
loans originated by Valley. At December 31, 2017, our
PCI loan portfolio totaled $1.4
billion, or 7.6 percent of our total loan portfolio.
Total non-performing assets (NPAs), consisting of non-accrual
loans, other real estate owned (OREO), other repossessed assets and
non-accrual debt securities totaled $57.5
million at December 31, 2017 compared to $55.2 million at September
30, 2017. The $2.3 million
increase in NPAs from September 30,
2017 was mostly due to an increase of $5.4 million in non-accrual loans, partially
offset by a $975 thousand decrease in
OREO at December 31, 2017. The increase in non-accrual
loans was primarily related to taxi medallion loans totaling
$8.8 million (See further discussion
of our taxi medallion lending below). Despite the increase,
non-accrual loans represented only 0.26 percent of total loans at
December 31, 2017 as compared to 0.23 percent of total loans
at September 30, 2017.
Total accruing past due loans (i.e., loans past due 30 days or
more and still accruing interest) increased $50.3 million to $80.5
million, or 0.44 percent of total loans, at
December 31, 2017 as compared to $30.1
million, or 0.17 percent of total loans, at September 30, 2017. The higher level of
accruing past due loans was primarily caused by increases of
$16.3 million and $12.9 million in construction loans past due 60
to 89 days and 30 to 59 days, respectively. The majority of
the construction loans in these past due categories at December 31, 2017 are now either current to
contractual terms or, if matured, in the normal process of renewal
or collection. Our commercial real estate loans past due 30
to 59 days were $11.2 million at
December 31, 2017 as compared to $4.8
million at September 30,
2017. The increase was largely related to 3 performing
matured loans (in the normal process of renewal) with total
combined balance of $7.6
million.
During the fourth quarter of 2017, we continued to closely
monitor our NYC and Chicago taxi medallion loans within the
commercial and industrial loan portfolio. While the vast
majority of the taxi medallion loans are currently performing,
continued negative trends in the market valuations of the
underlying taxi medallion collateral could impact the future
performance and internal classification of this portfolio. At
December 31, 2017, the NYC
and Chicago taxi medallion loans
totaling $127.7 million and
$9.6 million, respectively, are
largely classified as substandard and special mention loans. At
December 31, 2017, the medallion portfolio included impaired
loans of $63.9 million with related
reserves of $9.1 million within the
allowance for loan losses as compared to impaired loans of
$40.5 million with related reserves
of $5.0 million at September 30, 2017. At December 31,
2017, the impaired taxi medallion loans largely consisted of
performing troubled debt restructured (TDR) loans classified as
substandard loans, as well as $14.2
million of non-accrual taxi cab medallion loans classified
as doubtful. Our non-accrual taxi medallion loans increased
$8.6 million as compared to
September 30, 2017 largely due to
weakened levels of cash flow, collateral and guarantor support in
relation to some medallion borrowers, and not due to actual loan
performance.
Valley's historical taxi medallion lending criteria has been
conservative in regards to capping the loan amounts in relation to
market valuations, as well as obtaining personal guarantees and
other collateral in certain instances. However, potential further
declines in the market valuation of taxi medallions could
negatively impact the future performance of this portfolio.
The following table summarizes the allocation of the allowance
for credit losses to specific loan categories and the allocation as
a percentage of each loan category (including PCI loans) at
December 31, 2017, September 30,
2017, and December 31, 2016:
|
|
December 31,
2017
|
|
September 30,
2017
|
|
December 31,
2016
|
|
|
|
|
Allocation
|
|
|
|
Allocation
|
|
|
|
Allocation
|
|
|
|
|
as a %
of
|
|
|
|
as a %
of
|
|
|
|
as a %
of
|
|
|
Allowance
|
|
Loan
|
|
Allowance
|
|
Loan
|
|
Allowance
|
|
Loan
|
|
|
Allocation
|
|
Category
|
|
Allocation
|
|
Category
|
|
Allocation
|
|
Category
|
|
|
($ in
thousands)
|
Loan
Category:
|
|
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial loans*
|
$
|
60,828
|
|
|
2.22
|
%
|
|
$
|
57,203
|
|
|
2.11
|
%
|
|
$
|
53,005
|
|
|
2.01
|
%
|
Commercial real
estate loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
36,293
|
|
|
0.38
|
%
|
|
36,626
|
|
|
0.39
|
%
|
|
36,405
|
|
|
0.42
|
%
|
|
Construction
|
18,661
|
|
|
2.19
|
%
|
|
18,673
|
|
|
2.07
|
%
|
|
19,446
|
|
|
2.36
|
%
|
Total commercial real
estate loans
|
54,954
|
|
|
0.53
|
%
|
|
55,299
|
|
|
0.54
|
%
|
|
55,851
|
|
|
0.59
|
%
|
Residential mortgage
loans
|
3,605
|
|
|
0.13
|
%
|
|
3,892
|
|
|
0.13
|
%
|
|
3,702
|
|
|
0.13
|
%
|
Consumer
loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
Home
equity
|
579
|
|
|
0.13
|
%
|
|
592
|
|
|
0.13
|
%
|
|
486
|
|
|
0.10
|
%
|
|
Auto and other
consumer
|
4,486
|
|
|
0.23
|
%
|
|
4,494
|
|
|
0.24
|
%
|
|
3,560
|
|
|
0.21
|
%
|
Total consumer
loans
|
5,065
|
|
|
0.21
|
%
|
|
5,086
|
|
|
0.22
|
%
|
|
4,046
|
|
|
0.19
|
%
|
Total allowance for
credit losses
|
$
|
124,452
|
|
|
0.68
|
%
|
|
$
|
121,480
|
|
|
0.67
|
%
|
|
$
|
116,604
|
|
|
0.68
|
%
|
Allowance for credit
losses as a %
|
|
|
|
|
|
|
|
|
|
|
|
of non-PCI
loans
|
|
|
0.73
|
%
|
|
|
|
0.73
|
%
|
|
|
|
0.75
|
%
|
|
|
|
|
|
|
|
|
|
|
|
* Includes
the reserve for unfunded letters of credit.
|
|
|
|
|
|
|
|
|
|
|
Our loan portfolio, totaling $18.3
billion at December 31, 2017, had net recoveries of
loan charge-offs of $772 thousand and
$1.2 million for the fourth quarter
of 2017 and third quarter of 2017, respectively, as compared to net
loan charge-offs of $110 thousand for
the fourth quarter of 2016. Overall, net loan charge-offs
decreased to $2.1 million for the
year ended December 31, 2017 from $3.6
million for the year ended December 31, 2016.
During the fourth quarter of 2017, we recorded a provision for
credit losses totaling $2.2 million
as compared to $1.6 million for the
third quarter of 2017 and $3.8
million for the fourth quarter of 2016. Overall, our
provision for credit losses was $9.9
million for the year ended December 31, 2017 as
compared to $11.9 million for the
year ended December 31, 2016.
The allowance for credit losses, comprised of our allowance for
loan losses and reserve for unfunded letters of credit, as a
percentage of total loans was 0.68 percent at both
December 31, 2017 and December 31, 2016, and was 0.67
percent at September 30, 2017.
At December 31, 2017, our allowance allocations for losses as
a percentage of total loans remained relatively stable in most loan
categories as compared to September 30,
2017, but increased 0.11 percent for commercial and
industrial loans due, in part, to an increase in specific reserves
for impaired loans.
Our allowance for credit losses as a percentage of total non-PCI
loans (excluding PCI loans with carrying values totaling
approximately $1.4 billion) was 0.73
percent at December 31, 2017 as compared to 0.73 percent and
0.75 percent at September 30, 2017
and December 31, 2016, respectively. PCI loans, largely
acquired through prior bank acquisitions, are accounted for on a
pool basis and initially recorded net of fair valuation discounts
related to credit which may be used to absorb future losses on such
loans before any allowance for loan losses is recognized subsequent
to acquisition. Due to the adequacy of such discounts, there
were no allowance reserves related to PCI loans at
December 31, 2017, September 30,
2017 and December 31, 2016.
Capital Adequacy
Valley's regulatory capital ratios continue to reflect its
strong capital position. Valley's total risk-based capital, Tier 1
capital, Tier 1 leverage capital, and common equity Tier 1 capital
ratios were 12.61 percent, 10.41 percent, 8.03 percent and
9.22 percent, respectively, at December 31, 2017.
Investor Conference Call
Valley will host a conference call with investors and the
financial community at 11:00 AM Eastern
Standard Time, today to discuss the 2017 fourth quarter
earnings. Those wishing to participate in the call may dial
toll-free (800) 230-1951. Investor presentation materials
will be made available prior to the conference call at
www.valleynationalbank.com.
About Valley
Valley National Bancorp is a regional bank holding company
headquartered in Wayne, New Jersey
with approximately $28 billion
in assets, reflecting the recent acquisition of USAB. Its principal
subsidiary, Valley National Bank, currently operates over 230
branch locations in northern and central New Jersey, the New
York City boroughs of Manhattan, Brooklyn, Queens and Long
Island, Florida and
Alabama. Valley National Bank is
one of the largest commercial banks headquartered in New Jersey and is committed to providing the
most convenient service, the latest in product innovations and an
experienced and knowledgeable staff with a high priority on
friendly customer service. For more information about Valley
National Bank and its products and services, please visit
www.valleynationalbank.com or call our Customer Service Center
at 800-522-4100.
Forward Looking Statements
The foregoing contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of
1995. Such statements are not historical facts and include
expressions about management's confidence and strategies and
management's expectations about new and existing programs and
products, acquisitions, relationships, opportunities, taxation,
technology, market conditions and economic expectations. These
statements may be identified by such forward-looking terminology as
"should," "expect," "believe," "view," "opportunity," "allow,"
"continues," "reflects," "typically," "usually," "anticipate," or
similar statements or variations of such terms. Such
forward-looking statements involve certain risks and uncertainties.
Actual results may differ materially from such forward-looking
statements. Factors that may cause actual results to differ
materially from those contemplated by such forward-looking
statements include, but are not limited to:
- weakness or a decline in the economy, mainly in New Jersey, New
York, Florida and
Alabama, as well as an unexpected
decline in commercial real estate values within our market
areas;
- less than expected cost reductions and revenue enhancement from
Valley's cost reduction plans including its earnings enhancement
program called "LIFT";
- higher or lower than expected income tax expense or tax rates,
including increases or decreases resulting from the impact of the
Tax Act and other changes in tax laws, regulations and case
law;
- damage verdicts or settlements or restrictions related to
existing or potential litigations arising from claims of breach of
fiduciary responsibility, negligence, fraud, contractual claims,
environmental laws, patent or trade mark infringement, employment
related claims, and other matters;
- the loss of or decrease in lower-cost funding sources within
our deposit base may adversely impact our net interest income and
net income;
- cyber attacks, computer viruses or other malware that may
breach the security of our websites or other systems to obtain
unauthorized access to confidential information, destroy data,
disable or degrade service, or sabotage our systems;
- results of examinations by the OCC, the FRB, the CFPB and other
regulatory authorities, including the possibility that any such
regulatory authority may, among other things, require us to
increase our allowance for credit losses, write-down assets,
require us to reimburse customers, change the way we do business,
or limit or eliminate certain other banking activities;
- changes in accounting policies or accounting standards,
including the new authoritative accounting guidance (known as the
current expected credit loss (CECL) model) which may increase the
required level of our allowance for credit losses after adoption on
January 1, 2020;
- our inability or determination not to pay dividends at current
levels, or at all, because of inadequate future earnings,
regulatory restrictions or limitations, changes in our capital
requirements or a decision to increase capital by retaining more
earnings;
- higher than expected loan losses within one or more segments of
our loan portfolio;
- unanticipated loan delinquencies, loss of collateral, decreased
service revenues, and other potential negative effects on our
business caused by severe weather or other external events;
- unexpected significant declines in the loan portfolio due to
the lack of economic expansion, increased competition, large
prepayments, changes in regulatory lending guidance or other
factors;
- the failure of other financial institutions with whom we have
trading, clearing, counterparty and other financial
relationships.
- the risk that the businesses of Valley and USAB may not be
combined successfully, or such combination may take longer or be
more difficult, time-consuming or costly to accomplish than
expected;
- the diversion of management's time on issues relating to merger
integration; the inability to realize expected cost savings and
synergies from the merger of USAB with Valley in the amounts or in
the timeframe anticipated; and
- the inability to retain USAB's customers and employees.
A detailed discussion of factors that could affect our results
is included in our SEC filings, including the "Risk Factors"
section of our Annual Report on Form 10-K for the year ended
December 31, 2016 and Quarterly
Report on Form 10-Q for the period ended September 30, 2017.
We undertake no duty to update any forward-looking statement to
conform the statement to actual results or changes in our
expectations. Although we believe that the expectations
reflected in the forward-looking statements are reasonable, we
cannot guarantee future results, levels of activity, performance or
achievements.
VALLEY NATIONAL
BANCORP
CONSOLIDATED
FINANCIAL HIGHLIGHTS
|
|
|
|
|
SELECTED FINANCIAL
DATA
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Years
Ended
|
|
December
31,
|
|
September
30,
|
|
December
31,
|
|
December
31,
|
($ in thousands,
except for share data)
|
2017
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
FINANCIAL
DATA:
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
$
|
171,969
|
|
|
$
|
164,854
|
|
|
$
|
164,395
|
|
|
$
|
668,312
|
|
|
$
|
618,149
|
|
Net interest income -
FTE (1)
|
173,949
|
|
|
166,878
|
|
|
166,601
|
|
|
676,615
|
|
|
626,531
|
|
Non-interest
income
|
27,604
|
|
|
26,088
|
|
|
32,660
|
|
|
103,441
|
|
|
103,225
|
|
Non-interest
expense
|
136,317
|
|
|
132,565
|
|
|
124,829
|
|
|
509,073
|
|
|
476,125
|
|
Income tax
expense
|
34,958
|
|
|
17,088
|
|
|
18,336
|
|
|
90,831
|
|
|
65,234
|
|
Net income
|
26,098
|
|
|
39,649
|
|
|
50,090
|
|
|
161,907
|
|
|
168,146
|
|
Dividends on
preferred stock
|
3,172
|
|
|
2,683
|
|
|
1,797
|
|
|
9,449
|
|
|
7,188
|
|
Net income available
to common stockholders
|
$
|
22,926
|
|
|
$
|
36,966
|
|
|
$
|
48,293
|
|
|
$
|
152,458
|
|
|
$
|
160,958
|
|
Weighted average
number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
Basic
|
264,332,895
|
|
|
264,058,174
|
|
|
256,422,437
|
|
|
264,038,123
|
|
|
254,841,571
|
|
Diluted
|
265,288,067
|
|
|
264,936,220
|
|
|
256,952,036
|
|
|
264,889,007
|
|
|
255,268,336
|
|
Per common share
data:
|
|
|
|
|
|
|
|
|
|
Basic
earnings
|
$
|
0.09
|
|
|
$
|
0.14
|
|
|
$
|
0.19
|
|
|
$
|
0.58
|
|
|
$
|
0.63
|
|
Diluted
earnings
|
0.09
|
|
|
0.14
|
|
|
0.19
|
|
|
0.58
|
|
|
0.63
|
|
Cash dividends
declared
|
0.11
|
|
|
0.11
|
|
|
0.11
|
|
|
0.44
|
|
|
0.44
|
|
Closing stock price -
high
|
12.17
|
|
|
12.40
|
|
|
11.97
|
|
|
12.76
|
|
|
11.97
|
|
Closing stock price -
low
|
11.00
|
|
|
10.71
|
|
|
9.46
|
|
|
10.71
|
|
|
8.31
|
|
CORE ADJUSTED
FINANCIAL DATA: (2)
|
|
|
|
|
|
|
|
|
|
Net income available
to common shareholders, as adjusted
|
$
|
46,560
|
|
|
$
|
43,919
|
|
|
$
|
48,293
|
|
|
$
|
183,046
|
|
|
$
|
160,958
|
|
Basic earnings per
share, as adjusted
|
0.18
|
|
|
0.17
|
|
|
0.19
|
|
|
0.69
|
|
|
0.63
|
|
Diluted earnings per
share, as adjusted
|
0.18
|
|
|
0.17
|
|
|
0.19
|
|
|
0.69
|
|
|
0.63
|
|
FINANCIAL
RATIOS:
|
|
|
|
|
|
|
|
|
|
Net interest
margin
|
3.14
|
%
|
|
3.05
|
%
|
|
3.23
|
%
|
|
3.11
|
%
|
|
3.12
|
%
|
Net interest margin -
FTE (1)
|
3.17
|
|
|
3.08
|
|
|
3.27
|
|
|
3.15
|
|
|
3.16
|
|
Annualized return on
average assets
|
0.44
|
|
|
0.67
|
|
|
0.88
|
|
|
0.69
|
|
|
0.76
|
|
Annualized return on
avg. shareholders' equity
|
4.07
|
|
|
6.34
|
|
|
8.70
|
|
|
6.55
|
|
|
7.46
|
|
Annualized return on
avg. tangible shareholders' equity (2)
|
5.71
|
|
|
8.96
|
|
|
12.76
|
|
|
9.32
|
|
|
11.07
|
|
Efficiency ratio
(3)
|
68.30
|
|
|
69.43
|
|
|
63.35
|
|
|
65.96
|
|
|
66.00
|
|
CORE ADJUSTED
FINANCIAL RATIOS: (2)
|
|
|
|
|
|
|
|
|
|
Annualized return on
average assets, as adjusted
|
0.83
|
%
|
|
0.79
|
%
|
|
0.88
|
%
|
|
0.82
|
%
|
|
0.76
|
%
|
Annualized return on
average shareholders' equity, as adjusted
|
7.76
|
|
|
7.45
|
|
|
8.70
|
|
|
7.79
|
|
|
7.46
|
|
Annualized return on
average tangible shareholders' equity, as adjusted
|
10.87
|
|
|
10.54
|
|
|
12.76
|
|
|
11.08
|
|
|
11.07
|
|
Efficiency ratio, as
adjusted
|
57.44
|
|
|
59.21
|
|
|
56.56
|
|
|
58.93
|
|
|
61.19
|
|
AVERAGE BALANCE
SHEET ITEMS:
|
|
|
|
|
|
|
|
|
|
Assets
|
$
|
23,907,011
|
|
|
$
|
23,604,252
|
|
|
$
|
22,679,991
|
|
|
$
|
23,478,798
|
|
|
$
|
22,044,874
|
|
Interest earning
assets
|
21,932,517
|
|
|
21,642,846
|
|
|
20,388,486
|
|
|
21,488,498
|
|
|
19,829,312
|
|
Loans
|
18,242,690
|
|
|
18,006,274
|
|
|
16,779,765
|
|
|
17,819,003
|
|
|
16,400,745
|
|
Interest bearing
liabilities
|
15,919,382
|
|
|
15,737,738
|
|
|
14,928,160
|
|
|
15,640,317
|
|
|
14,524,881
|
|
Deposits
|
17,812,343
|
|
|
17,353,099
|
|
|
17,428,646
|
|
|
17,456,115
|
|
|
16,734,639
|
|
Shareholders'
equity
|
2,562,326
|
|
|
2,502,538
|
|
|
2,304,208
|
|
|
2,471,751
|
|
|
2,253,570
|
|
VALLEY NATIONAL
BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS
|
|
|
|
As
of
|
BALANCE SHEET
ITEMS:
|
December
31,
|
|
September
30,
|
|
June
30,
|
|
March
31,
|
|
December
31,
|
(In
thousands)
|
2017
|
|
2017
|
|
2017
|
|
2017
|
|
2016
|
Assets
|
$
|
24,002,306
|
|
|
$
|
23,780,661
|
|
|
$
|
23,449,350
|
|
|
$
|
23,220,456
|
|
|
$
|
22,864,439
|
|
Total
loans
|
18,331,580
|
|
|
18,201,462
|
|
|
17,710,760
|
|
|
17,449,498
|
|
|
17,236,103
|
|
Non-PCI
loans
|
16,944,365
|
|
|
16,729,607
|
|
|
16,169,291
|
|
|
15,794,797
|
|
|
15,464,601
|
|
Deposits
|
18,153,462
|
|
|
17,312,766
|
|
|
17,250,018
|
|
|
17,331,141
|
|
|
17,730,708
|
|
Shareholders'
equity
|
2,533,165
|
|
|
2,537,984
|
|
|
2,423,901
|
|
|
2,398,541
|
|
|
2,377,156
|
|
|
|
|
|
|
|
|
|
|
|
LOANS:
|
|
|
|
|
|
|
|
|
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial
|
$
|
2,741,425
|
|
|
$
|
2,706,912
|
|
|
$
|
2,631,312
|
|
|
$
|
2,642,319
|
|
|
$
|
2,638,195
|
|
Commercial real
estate:
|
|
|
|
|
|
|
|
|
|
Commercial real
estate
|
9,496,777
|
|
|
9,351,068
|
|
|
9,230,514
|
|
|
9,016,418
|
|
|
8,719,667
|
|
Construction
|
851,105
|
|
|
903,640
|
|
|
881,073
|
|
|
835,854
|
|
|
824,946
|
|
Total commercial real
estate
|
10,347,882
|
|
|
10,254,708
|
|
|
10,111,587
|
|
|
9,852,272
|
|
|
9,544,613
|
|
Residential
mortgage
|
2,859,035
|
|
|
2,941,435
|
|
|
2,724,777
|
|
|
2,745,447
|
|
|
2,867,918
|
|
Consumer:
|
|
|
|
|
|
|
|
|
|
Home
equity
|
446,280
|
|
|
448,842
|
|
|
450,510
|
|
|
458,891
|
|
|
469,009
|
|
Automobile
|
1,208,902
|
|
|
1,171,685
|
|
|
1,150,343
|
|
|
1,150,053
|
|
|
1,139,227
|
|
Other
consumer
|
728,056
|
|
|
677,880
|
|
|
642,231
|
|
|
600,516
|
|
|
577,141
|
|
Total consumer
loans
|
2,383,238
|
|
|
2,298,407
|
|
|
2,243,084
|
|
|
2,209,460
|
|
|
2,185,377
|
|
Total
loans
|
$
|
18,331,580
|
|
|
$
|
18,201,462
|
|
|
$
|
17,710,760
|
|
|
$
|
17,449,498
|
|
|
$
|
17,236,103
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL
RATIOS:
|
|
|
|
|
|
|
|
|
|
Book value per common
share
|
$
|
8.79
|
|
|
$
|
8.81
|
|
|
$
|
8.76
|
|
|
$
|
8.67
|
|
|
$
|
8.59
|
|
Tangible book value
per common share(2)
|
6.01
|
|
|
6.04
|
|
|
5.98
|
|
|
5.88
|
|
|
5.80
|
|
Tangible common
equity to tangible assets (2)
|
6.83
|
%
|
|
6.92
|
%
|
|
6.95
|
%
|
|
6.90
|
%
|
|
6.91
|
%
|
Tier 1 leverage
capital
|
8.03
|
|
|
8.13
|
|
|
7.69
|
|
|
7.70
|
|
|
7.74
|
|
Common equity tier 1
capital
|
9.22
|
|
|
9.22
|
|
|
9.18
|
|
|
9.12
|
|
|
9.27
|
|
Tier 1 risk-based
capital
|
10.41
|
|
|
10.42
|
|
|
9.81
|
|
|
9.76
|
|
|
9.90
|
|
Total risk-based
capital
|
12.61
|
|
|
12.61
|
|
|
11.99
|
|
|
11.96
|
|
|
12.15
|
|
VALLEY NATIONAL
BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS
|
|
|
|
|
|
Three Months
Ended
|
|
Years
Ended
|
ALLOWANCE FOR
CREDIT LOSSES:
|
December
31,
|
|
September
30,
|
|
December
31,
|
|
December
31,
|
($ in
thousands)
|
2017
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Beginning balance -
Allowance for credit losses
|
$
|
121,480
|
|
|
$
|
118,621
|
|
|
$
|
112,914
|
|
|
$
|
116,604
|
|
|
$
|
108,367
|
|
Loans
charged-off:
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial
|
(532)
|
|
|
(265)
|
|
|
(483)
|
|
|
(5,421)
|
|
|
(5,990)
|
|
Commercial real
estate
|
(6)
|
|
|
—
|
|
|
(131)
|
|
|
(559)
|
|
|
(650)
|
|
Construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Residential
mortgage
|
(42)
|
|
|
(129)
|
|
|
(116)
|
|
|
(530)
|
|
|
(866)
|
|
Total
Consumer
|
(1,097)
|
|
|
(1,335)
|
|
|
(911)
|
|
|
(4,564)
|
|
|
(3,463)
|
|
Total loans
charged-off
|
(1,677)
|
|
|
(1,729)
|
|
|
(1,641)
|
|
|
(11,074)
|
|
|
(10,969)
|
|
Charged-off loans
recovered:
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial
|
1,256
|
|
|
2,320
|
|
|
435
|
|
|
4,736
|
|
|
2,852
|
|
Commercial real
estate
|
22
|
|
|
42
|
|
|
466
|
|
|
552
|
|
|
2,047
|
|
Construction
|
579
|
|
|
—
|
|
|
—
|
|
|
873
|
|
|
10
|
|
Residential
mortgage
|
113
|
|
|
220
|
|
|
171
|
|
|
1,016
|
|
|
774
|
|
Total
Consumer
|
479
|
|
|
366
|
|
|
459
|
|
|
1,803
|
|
|
1,654
|
|
Total loans
recovered
|
2,449
|
|
|
2,948
|
|
|
1,531
|
|
|
8,980
|
|
|
7,337
|
|
Net recoveries
(charge-offs)
|
772
|
|
|
1,219
|
|
|
(110)
|
|
|
(2,094)
|
|
|
(3,632)
|
|
Provision for credit
losses
|
2,200
|
|
|
1,640
|
|
|
3,800
|
|
|
9,942
|
|
|
11,869
|
|
Ending balance -
Allowance for credit losses
|
$
|
124,452
|
|
|
$
|
121,480
|
|
|
$
|
116,604
|
|
|
$
|
124,452
|
|
|
$
|
116,604
|
|
Components of
allowance for credit losses:
|
|
|
|
|
|
|
|
|
|
Allowance for
loans
|
$
|
120,856
|
|
|
$
|
118,966
|
|
|
$
|
114,419
|
|
|
$
|
120,856
|
|
|
$
|
114,419
|
|
Allowance for
unfunded letters of credit
|
3,596
|
|
|
2,514
|
|
|
2,185
|
|
|
3,596
|
|
|
2,185
|
|
Allowance for credit
losses
|
$
|
124,452
|
|
|
$
|
121,480
|
|
|
$
|
116,604
|
|
|
$
|
124,452
|
|
|
$
|
116,604
|
|
Components of
provision for credit losses:
|
|
|
|
|
|
|
|
|
|
Provision for loan
losses
|
$
|
1,118
|
|
|
$
|
1,301
|
|
|
$
|
3,832
|
|
|
$
|
8,531
|
|
|
$
|
11,873
|
|
Provision for
unfunded letters of credit
|
1,082
|
|
|
339
|
|
|
(32)
|
|
|
1,411
|
|
|
(4)
|
|
Provision for credit
losses
|
$
|
2,200
|
|
|
$
|
1,640
|
|
|
$
|
3,800
|
|
|
$
|
9,942
|
|
|
$
|
11,869
|
|
|
|
|
|
|
|
|
|
|
|
Annualized ratio of
total net (recoveries) charge-offs to average loans
|
(0.02)
|
%
|
|
(0.03)
|
%
|
|
0.00
|
%
|
|
0.01
|
%
|
|
0.02
|
%
|
Allowance for credit
losses as a % of non-PCI loans
|
0.73
|
%
|
|
0.73
|
%
|
|
0.75
|
%
|
|
0.73
|
%
|
|
0.75
|
%
|
Allowance for credit
losses as a % of total loans
|
0.68
|
%
|
|
0.67
|
%
|
|
0.68
|
%
|
|
0.68
|
%
|
|
0.68
|
%
|
VALLEY NATIONAL
BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS
|
|
|
|
As
of
|
ASSET
QUALITY: (4)
|
December
31,
|
|
September
30,
|
|
June
30,
|
|
March
31,
|
|
December
31,
|
($ in
thousands)
|
2017
|
|
2017
|
|
2017
|
|
2017
|
|
2016
|
Accruing past due
loans:
|
|
|
|
|
|
|
|
|
|
30 to 59 days past
due:
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial
|
$
|
3,650
|
|
|
$
|
1,186
|
|
|
$
|
2,391
|
|
|
$
|
29,734
|
|
|
$
|
6,705
|
|
Commercial real
estate
|
11,223
|
|
|
4,755
|
|
|
6,983
|
|
|
11,637
|
|
|
5,894
|
|
Construction
|
12,949
|
|
|
—
|
|
|
—
|
|
|
7,760
|
|
|
6,077
|
|
Residential
mortgage
|
12,669
|
|
|
7,942
|
|
|
4,677
|
|
|
7,533
|
|
|
12,005
|
|
Total
Consumer
|
8,409
|
|
|
5,205
|
|
|
4,393
|
|
|
3,740
|
|
|
4,197
|
|
Total 30 to 59 days
past due
|
48,900
|
|
|
19,088
|
|
|
18,444
|
|
|
60,404
|
|
|
34,878
|
|
60 to 89 days past
due:
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial
|
544
|
|
|
3,043
|
|
|
2,686
|
|
|
341
|
|
|
5,010
|
|
Commercial real
estate
|
—
|
|
|
626
|
|
|
8,233
|
|
|
359
|
|
|
8,642
|
|
Construction
|
18,845
|
|
|
2,518
|
|
|
854
|
|
|
—
|
|
|
—
|
|
Residential
mortgage
|
7,903
|
|
|
1,604
|
|
|
1,721
|
|
|
4,177
|
|
|
3,564
|
|
Total
Consumer
|
1,199
|
|
|
1,019
|
|
|
1,007
|
|
|
787
|
|
|
1,147
|
|
Total 60 to 89 days
past due
|
28,491
|
|
|
8,810
|
|
|
14,501
|
|
|
5,664
|
|
|
18,363
|
|
90 or more days past
due:
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial
|
—
|
|
|
125
|
|
|
—
|
|
|
405
|
|
|
142
|
|
Commercial real
estate
|
27
|
|
|
389
|
|
|
2,315
|
|
|
—
|
|
|
474
|
|
Construction
|
—
|
|
|
—
|
|
|
2,879
|
|
|
—
|
|
|
1,106
|
|
Residential
mortgage
|
2,779
|
|
|
1,433
|
|
|
3,353
|
|
|
1,355
|
|
|
1,541
|
|
Total
Consumer
|
284
|
|
|
301
|
|
|
275
|
|
|
314
|
|
|
209
|
|
Total 90 or more days
past due
|
3,090
|
|
|
2,248
|
|
|
8,822
|
|
|
2,074
|
|
|
3,472
|
|
Total accruing past
due loans
|
$
|
80,481
|
|
|
$
|
30,146
|
|
|
$
|
41,767
|
|
|
$
|
68,142
|
|
|
$
|
56,713
|
|
Non-accrual
loans:
|
|
|
|
|
|
|
|
|
|
Commercial and
industrial
|
$
|
20,890
|
|
|
$
|
11,983
|
|
|
$
|
11,072
|
|
|
$
|
8,676
|
|
|
$
|
8,465
|
|
Commercial real
estate
|
11,328
|
|
|
13,870
|
|
|
15,514
|
|
|
15,106
|
|
|
15,079
|
|
Construction
|
732
|
|
|
1,116
|
|
|
1,334
|
|
|
1,461
|
|
|
715
|
|
Residential
mortgage
|
12,405
|
|
|
12,974
|
|
|
12,825
|
|
|
11,650
|
|
|
12,075
|
|
Total
Consumer
|
1,870
|
|
|
1,844
|
|
|
1,409
|
|
|
1,395
|
|
|
1,174
|
|
Total non-accrual
loans
|
47,225
|
|
|
41,787
|
|
|
42,154
|
|
|
38,288
|
|
|
37,508
|
|
Other real estate
owned (OREO)(5)
|
9,795
|
|
|
10,770
|
|
|
10,182
|
|
|
10,737
|
|
|
9,612
|
|
Other repossessed
assets
|
441
|
|
|
480
|
|
|
342
|
|
|
475
|
|
|
384
|
|
Non-accrual debt
securities(6)
|
—
|
|
|
2,115
|
|
|
1,878
|
|
|
2,007
|
|
|
1,935
|
|
Total non-performing
assets
|
$
|
57,461
|
|
|
$
|
55,152
|
|
|
$
|
54,556
|
|
|
$
|
51,507
|
|
|
$
|
49,439
|
|
Performing troubled
debt restructured loans
|
$
|
117,176
|
|
|
$
|
113,677
|
|
|
$
|
109,802
|
|
|
$
|
80,360
|
|
|
$
|
85,166
|
|
Total non-accrual
loans as a % of loans
|
0.26
|
%
|
|
0.23
|
%
|
|
0.24
|
%
|
|
0.22
|
%
|
|
0.22
|
%
|
Total accruing past
due and non-accrual loans
as a % of loans
|
0.70
|
%
|
|
0.40
|
%
|
|
0.47
|
%
|
|
0.61
|
%
|
|
0.55
|
%
|
Allowance for loan
losses as a % of non-accrual
loans
|
255.92
|
%
|
|
284.70
|
%
|
|
276.24
|
%
|
|
301.51
|
%
|
|
305.05
|
%
|
Non-performing
purchased credit-impaired loans (7)
|
$
|
38,088
|
|
|
$
|
25,413
|
|
|
$
|
33,715
|
|
|
$
|
25,857
|
|
|
$
|
27,011
|
|
VALLEY NATIONAL
BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS
|
|
|
NOTES TO SELECTED
FINANCIAL DATA
|
|
|
(1)
|
Net interest income
and net interest margin are presented on a tax equivalent basis
using a 35 percent federal tax rate. Valley believes that
this presentation provides comparability of net interest income and
net interest margin arising from both taxable and tax-exempt
sources and is consistent with industry practice and SEC
rules.
|
(2)
|
This press release
contains certain supplemental financial information, described in
the Notes below, which has been determined by methods other than
U.S. Generally Accepted Accounting Principles ("GAAP") that
management uses in its analysis of Valley's performance.
Management believes these non-GAAP financial measures provide
information useful to investors in understanding Valley's financial
results. Specifically, Valley provides measures based on what it
believes are its operating earnings on a consistent basis and
excludes material non-core operating items which affect the GAAP
reporting of results of operations. Management utilizes these
measures for internal planning and forecasting purposes. Management
believes that Valley's presentation and discussion, together with
the accompanying reconciliations, provides a complete understanding
of factors and trends affecting Valley's business and allows
investors to view performance in a manner similar to management.
These non-GAAP measures should not be considered a substitute for
GAAP basis measures and results and Valley strongly encourages
investors to review its consolidated financial statements in their
entirety and not to rely on any single financial measure.
Because non-GAAP financial measures are not standardized, it may
not be possible to compare these financial measures with other
companies' non-GAAP financial measures having the same or similar
names.
|
|
Three Months
Ended
|
|
Years
Ended
|
|
December
31,
|
|
September
30,
|
|
December
31,
|
|
December
31,
|
($ in thousands,
except for share data)
|
2017
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Adjusted net
income available to common shareholders:
|
|
|
|
|
|
|
|
|
|
Net income, as
reported
|
$
|
26,098
|
|
|
$
|
39,649
|
|
|
$
|
50,090
|
|
|
$
|
161,907
|
|
|
$
|
168,146
|
|
Add: LIFT program
expenses (net of tax)*
|
—
|
|
|
5,753
|
|
|
—
|
|
|
5,753
|
|
|
—
|
|
Add: Merger related
expenses (net of tax)**
|
1,073
|
|
|
1,200
|
|
|
—
|
|
|
2,274
|
|
|
—
|
|
Add: Amortization of
tax credit investments (Tax Act Impact Only)
|
4,271
|
|
|
—
|
|
|
—
|
|
|
4,271
|
|
|
—
|
|
Add: Income Tax
Expense (Tax Act Impact Only)
|
18,290
|
|
|
—
|
|
|
—
|
|
|
18,290
|
|
|
—
|
|
Net income, as
adjusted
|
$
|
49,732
|
|
|
$
|
46,602
|
|
|
$
|
50,090
|
|
|
$
|
192,495
|
|
|
$
|
168,146
|
|
Dividends on
preferred stock
|
3,172
|
|
|
2,683
|
|
|
1,797
|
|
|
9,449
|
|
|
7,188
|
|
Net income available
to common shareholders, as adjusted
|
$
|
46,560
|
|
|
$
|
43,919
|
|
|
$
|
48,293
|
|
|
$
|
183,046
|
|
|
$
|
160,958
|
|
_____________
|
|
|
|
|
|
|
|
|
|
* LIFT program
expenses are primarily within professional and legal fees, and
salary and employee benefits expense.
|
** Merger
related expenses are primarily within professional and legal
fees.
|
Adjusted per
common share data:
|
|
|
|
|
|
|
|
|
|
Net income available
to common shareholders, as adjusted
|
$
|
46,560
|
|
|
$
|
43,919
|
|
|
$
|
48,293
|
|
|
$
|
183,046
|
|
|
$
|
160,958
|
|
Average number of
shares outstanding
|
264,332,895
|
|
|
264,058,174
|
|
|
256,422,437
|
|
|
264,038,123
|
|
|
254,841,571
|
|
Basic earnings, as
adjusted
|
$
|
0.18
|
|
|
$
|
0.17
|
|
|
$
|
0.19
|
|
|
$
|
0.69
|
|
|
$
|
0.63
|
|
Average number of
diluted shares outstanding
|
265,288,067
|
|
|
264,936,220
|
|
|
256,952,036
|
|
|
264,889,007
|
|
|
255,268,336
|
|
Diluted earnings, as
adjusted
|
$
|
0.18
|
|
|
$
|
0.17
|
|
|
$
|
0.19
|
|
|
$
|
0.69
|
|
|
$
|
0.63
|
|
Adjusted
annualized return on average tangible shareholders'
equity:
|
|
|
|
|
|
|
|
|
|
Net income, as
adjusted
|
$
|
49,732
|
|
|
$
|
46,602
|
|
|
$
|
50,090
|
|
|
$
|
192,495
|
|
|
$
|
168,146
|
|
Average shareholders'
equity
|
2,562,326
|
|
|
2,502,538
|
|
|
2,304,208
|
|
|
2,471,751
|
|
|
2,253,570
|
|
Less: Average
goodwill and other intangible assets
|
(732,604)
|
|
|
(733,450)
|
|
|
(733,714)
|
|
|
(734,200)
|
|
|
(734,520)
|
|
Average tangible
shareholders' equity
|
$
|
1,829,722
|
|
|
$
|
1,769,088
|
|
|
$
|
1,570,494
|
|
|
$
|
1,737,551
|
|
|
$
|
1,519,050
|
|
Annualized return on
average tangible shareholders' equity
|
10.87
|
%
|
|
10.54
|
%
|
|
12.76
|
%
|
|
11.08
|
%
|
|
11.07
|
%
|
Adjusted
annualized return on average assets:
|
|
|
|
|
|
|
|
|
|
Net income, as
adjusted
|
$
|
49,732
|
|
|
$
|
46,602
|
|
|
$
|
50,090
|
|
|
$
|
192,495
|
|
|
$
|
168,146
|
|
Average
assets
|
$
|
23,907,011
|
|
|
$
|
23,604,252
|
|
|
$
|
22,679,991
|
|
|
$
|
23,478,798
|
|
|
$
|
22,044,874
|
|
Annualized return on
average assets, as adjusted
|
0.83
|
%
|
|
0.79
|
%
|
|
0.88
|
%
|
|
0.82
|
%
|
|
0.76
|
%
|
Adjusted
annualized return on average shareholders' equity:
|
|
|
|
|
|
|
|
|
|
Net income, as
adjusted
|
$
|
49,732
|
|
|
$
|
46,602
|
|
|
$
|
50,090
|
|
|
$
|
192,495
|
|
|
$
|
168,146
|
|
Average shareholders'
equity
|
$
|
2,562,326
|
|
|
$
|
2,502,538
|
|
|
$
|
2,304,208
|
|
|
$
|
2,471,751
|
|
|
$
|
2,253,570
|
|
Annualized return on
average shareholders' equity, as adjusted
|
7.76
|
%
|
|
7.45
|
%
|
|
8.70
|
%
|
|
7.79
|
%
|
|
7.46
|
%
|
VALLEY NATIONAL
BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS
|
|
|
|
|
|
Three Months
Ended
|
|
Years
Ended
|
|
December
31,
|
|
September
30,
|
|
December
31,
|
|
December
31,
|
($ in
thousands)
|
2017
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Annualized return
on average tangible shareholders' equity:
|
|
|
|
|
|
|
|
|
|
Net income
|
$
|
26,098
|
|
|
$
|
39,649
|
|
|
$
|
50,090
|
|
|
$
|
161,907
|
|
|
$
|
168,146
|
|
Average shareholders'
equity
|
2,562,326
|
|
|
2,502,538
|
|
|
2,304,208
|
|
|
2,471,751
|
|
|
2,253,570
|
|
Less: Average
goodwill and other intangible assets
|
(732,604)
|
|
|
(733,450)
|
|
|
(733,714)
|
|
|
(734,200)
|
|
|
(734,520)
|
|
Average
tangible shareholders' equity
|
$
|
1,829,722
|
|
|
$
|
1,769,088
|
|
|
$
|
1,570,494
|
|
|
$
|
1,737,551
|
|
|
$
|
1,519,050
|
|
Annualized return on
average tangible shareholders' equity
|
5.71
|
%
|
|
8.96
|
%
|
|
12.76
|
%
|
|
9.32
|
%
|
|
11.07
|
%
|
Adjusted
efficiency ratio:
|
|
|
|
|
|
|
|
|
|
Non-interest
expense
|
$
|
136,317
|
|
|
$
|
132,565
|
|
|
$
|
124,829
|
|
|
$
|
509,073
|
|
|
$
|
476,125
|
|
Less: LIFT
program expenses (pre-tax)
|
—
|
|
|
9,875
|
|
|
—
|
|
|
9,875
|
|
|
—
|
|
Less:
Merger-related expenses (pre-tax)
|
1,378
|
|
|
1,241
|
|
|
—
|
|
|
2,620
|
|
|
—
|
|
Less:
Amortization of tax credit investments (pre-tax)
|
20,302
|
|
|
8,389
|
|
|
13,384
|
|
|
41,747
|
|
|
34,744
|
|
Non-interest expense,
as adjusted
|
114,637
|
|
|
113,060
|
|
|
111,445
|
|
|
454,831
|
|
|
441,381
|
|
Net interest
income
|
171,969
|
|
|
164,854
|
|
|
164,395
|
|
|
668,312
|
|
|
618,149
|
|
Non-interest
income
|
27,604
|
|
|
26,088
|
|
|
32,660
|
|
|
103,441
|
|
|
103,225
|
|
Gross operating
income
|
$
|
199,573
|
|
|
$
|
190,942
|
|
|
$
|
197,055
|
|
|
$
|
771,753
|
|
|
$
|
721,374
|
|
Efficiency ratio, as
adjusted
|
57.44
|
%
|
|
59.21
|
%
|
|
56.56
|
%
|
|
58.93
|
%
|
|
61.19
|
%
|
|
As
Of
|
|
December
31,
|
|
September
30,
|
|
June
30,
|
|
March
31,
|
|
December
31,
|
($ in thousands,
except for share data)
|
2017
|
|
2017
|
|
2017
|
|
2017
|
|
2016
|
Tangible book
value per common share:
|
|
|
|
|
|
|
|
|
|
Common shares
outstanding
|
264,468,851
|
|
|
264,197,172
|
|
|
263,971,766
|
|
|
263,842,268
|
|
|
263,638,830
|
|
Shareholders'
equity
|
$
|
2,533,165
|
|
|
$
|
2,537,984
|
|
|
$
|
2,423,901
|
|
|
$
|
2,398,541
|
|
|
$
|
2,377,156
|
|
Less: Preferred
Stock
|
(209,691)
|
|
|
(209,691)
|
|
|
(111,590)
|
|
|
(111,590)
|
|
|
(111,590)
|
|
Less: Goodwill and
other intangible assets
|
(733,144)
|
|
|
(733,498)
|
|
|
(734,337)
|
|
|
(735,595)
|
|
|
(736,121)
|
|
Tangible common
shareholders' equity
|
$
|
1,590,330
|
|
|
$
|
1,594,795
|
|
|
$
|
1,577,974
|
|
|
$
|
1,551,356
|
|
|
$
|
1,529,445
|
|
Tangible book value per common share
|
$6.01
|
|
|
$6.04
|
|
|
$5.98
|
|
|
$5.88
|
|
|
$5.80
|
|
Tangible common
equity to tangible assets:
|
|
|
|
|
|
|
|
|
|
Tangible common
shareholders' equity
|
$
|
1,590,330
|
|
|
$
|
1,594,795
|
|
|
$
|
1,577,974
|
|
|
$
|
1,551,356
|
|
|
$
|
1,529,445
|
|
Total
assets
|
$
|
24,002,306
|
|
|
$
|
23,780,661
|
|
|
$
|
23,449,350
|
|
|
$
|
23,220,456
|
|
|
$
|
22,864,439
|
|
Less: Goodwill and
other intangible assets
|
(733,144)
|
|
|
(733,498)
|
|
|
(734,337)
|
|
|
(735,595)
|
|
|
(736,121)
|
|
Tangible
assets
|
$
|
23,269,162
|
|
|
$
|
23,047,163
|
|
|
$
|
22,715,013
|
|
|
$
|
22,484,861
|
|
|
$
|
22,128,318
|
|
Tangible common equity to tangible assets
|
6.83
|
%
|
|
6.92
|
%
|
|
6.95
|
%
|
|
6.90
|
%
|
|
6.91
|
%
|
(3)
|
The efficiency ratio
measures Valley's total non-interest expense as a percentage of net
interest income plus total non-interest income.
|
(4)
|
Past due loans and
non-accrual loans exclude purchased credit-impaired (PCI)
loans. PCI loans are accounted for on a pool basis under U.S.
GAAP and are not subject to delinquency classification in the same
manner as loans originated by Valley.
|
(5)
|
Excludes OREO
properties related to FDIC-assisted transactions totaling $558
thousand at December 31, 2016. These assets are covered by the
loss-sharing agreements with the FDIC. There were no covered
OREO properties at December 31, 2017, September 30, 2017, June 30,
2017 and March 31, 2017.
|
(6)
|
Includes
other-than-temporarily impaired trust preferred securities
classified as available for sale, which are presented at carrying
value (net of unrealized losses totaling $637 thousand, $875
thousand, $745 thousand and $817 thousand at September 30, 2017,
June 30, 2017, March 31, 2017 and December 31, 2016, respectively)
after recognition of all credit impairments. There were no
non-accrual debt securities at December 31, 2017.
|
(7)
|
Represent PCI loans
meeting Valley's definition of non-performing loan (i.e.,
non-accrual loans), but are not subject to such classification
under U.S. GAAP because the loans are accounted for on a pooled
basis and are excluded from the non-accrual loans in the table
above.
|
SHAREHOLDERS RELATIONS
Requests for copies of reports
and/or other inquiries should be directed to Tina Zarkadas, Assistant Vice President,
Shareholder Relations Specialist, Valley National Bancorp, 1455
Valley Road, Wayne, New Jersey,
07470, by telephone at (973) 305-3380, by fax at (973) 305-1364 or
by e-mail at tzarkadas@valleynationalbank.com.
VALLEY NATIONAL
BANCORP
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(in thousands, except for share data)
|
|
|
|
December
31,
|
|
2017
|
|
2016
|
|
(Unaudited)
|
|
|
Assets
|
|
|
|
Cash and due from
banks
|
$
|
243,310
|
|
|
$
|
220,791
|
|
Interest bearing
deposits with banks
|
172,800
|
|
|
171,710
|
|
Investment
securities:
|
|
|
|
Held to maturity
(fair value of $1,837,620 at December 31, 2017 and $1,924,597
at December 31, 2016)
|
1,842,691
|
|
|
1,925,572
|
|
Available for
sale
|
1,493,905
|
|
|
1,297,373
|
|
Total investment
securities
|
3,336,596
|
|
|
3,222,945
|
|
Loans held for sale,
at fair value
|
15,119
|
|
|
57,708
|
|
Loans
|
18,331,580
|
|
|
17,236,103
|
|
Less: Allowance for
loan losses
|
(120,856)
|
|
|
(114,419)
|
|
Net loans
|
18,210,724
|
|
|
17,121,684
|
|
Premises and
equipment, net
|
287,705
|
|
|
291,180
|
|
Bank owned life
insurance
|
386,079
|
|
|
391,830
|
|
Accrued interest
receivable
|
73,990
|
|
|
66,816
|
|
Goodwill
|
690,637
|
|
|
690,637
|
|
Other intangible
assets, net
|
42,507
|
|
|
45,484
|
|
Other
assets
|
542,839
|
|
|
583,654
|
|
Total
Assets
|
$
|
24,002,306
|
|
|
$
|
22,864,439
|
|
Liabilities
|
|
|
|
Deposits:
|
|
|
|
Non-interest
bearing
|
$
|
5,224,928
|
|
|
$
|
5,252,825
|
|
Interest
bearing:
|
|
|
|
Savings, NOW and
money market
|
9,365,013
|
|
|
9,339,012
|
|
Time
|
3,563,521
|
|
|
3,138,871
|
|
Total
deposits
|
18,153,462
|
|
|
17,730,708
|
|
Short-term
borrowings
|
748,628
|
|
|
1,080,960
|
|
Long-term
borrowings
|
2,315,819
|
|
|
1,433,906
|
|
Junior subordinated
debentures issued to capital trusts
|
41,774
|
|
|
41,577
|
|
Accrued expenses and
other liabilities
|
209,458
|
|
|
200,132
|
|
Total
Liabilities
|
21,469,141
|
|
|
20,487,283
|
|
Shareholders'
Equity
|
|
|
|
Preferred stock, no
par value; 50,000,000 shares authorized:
|
|
|
|
Series A (4,600,000
shares issued at December 31, 2017 and December 31,
2016)
|
111,590
|
|
|
111,590
|
|
Series B (4,000,000
shares issued at December 31, 2017)
|
98,101
|
|
|
—
|
|
Common stock (no par
value, authorized 450,000,000 shares; issued 264,498,643
shares at December 31, 2017 and 263,804,877 shares at
December 31, 2016)
|
92,727
|
|
|
92,353
|
|
Surplus
|
2,060,356
|
|
|
2,044,401
|
|
Retained
earnings
|
208,806
|
|
|
172,754
|
|
Accumulated other
comprehensive loss
|
(38,078)
|
|
|
(42,093)
|
|
Treasury stock, at
cost (29,792 shares at December 31, 2017 and 166,047 common
shares at December 31, 2016)
|
(337)
|
|
|
(1,849)
|
|
Total
Shareholders' Equity
|
2,533,165
|
|
|
2,377,156
|
|
Total Liabilities
and Shareholders' Equity
|
$
|
24,002,306
|
|
|
$
|
22,864,439
|
|
VALLEY NATIONAL
BANCORP
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(in thousands, except for share data)
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Years
Ended
|
|
December
31,
|
|
September
30,
|
|
December
31,
|
|
December
31,
|
|
2017
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Interest
Income
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
$
|
195,092
|
|
|
$
|
186,773
|
|
|
$
|
179,271
|
|
|
$
|
742,739
|
|
|
$
|
685,911
|
|
Interest and
dividends on investment securities:
|
|
|
|
|
|
|
|
|
|
Taxable
|
18,237
|
|
|
17,922
|
|
|
15,656
|
|
|
72,676
|
|
|
58,143
|
|
Tax-exempt
|
3,673
|
|
|
3,752
|
|
|
4,090
|
|
|
15,399
|
|
|
15,537
|
|
Dividends
|
2,867
|
|
|
2,657
|
|
|
1,798
|
|
|
9,812
|
|
|
6,206
|
|
Interest on federal
funds sold and other short-term investments
|
637
|
|
|
546
|
|
|
280
|
|
|
1,793
|
|
|
1,126
|
|
Total interest
income
|
220,506
|
|
|
211,650
|
|
|
201,095
|
|
|
842,419
|
|
|
766,923
|
|
Interest
Expense
|
|
|
|
|
|
|
|
|
|
Interest on
deposits:
|
|
|
|
|
|
|
|
|
|
Savings, NOW and
money market
|
16,762
|
|
|
15,641
|
|
|
10,418
|
|
|
55,300
|
|
|
39,787
|
|
Time
|
11,975
|
|
|
10,852
|
|
|
9,555
|
|
|
42,546
|
|
|
37,775
|
|
Interest on
short-term borrowings
|
3,456
|
|
|
5,161
|
|
|
3,485
|
|
|
18,034
|
|
|
12,022
|
|
Interest on long-term
borrowings and junior subordinated debentures
|
16,344
|
|
|
15,142
|
|
|
13,242
|
|
|
58,227
|
|
|
59,190
|
|
Total interest
expense
|
48,537
|
|
|
46,796
|
|
|
36,700
|
|
|
174,107
|
|
|
148,774
|
|
Net Interest
Income
|
171,969
|
|
|
164,854
|
|
|
164,395
|
|
|
668,312
|
|
|
618,149
|
|
Provision for credit
losses
|
2,200
|
|
|
1,640
|
|
|
3,800
|
|
|
9,942
|
|
|
11,869
|
|
Net Interest
Income After Provision for Credit Losses
|
169,769
|
|
|
163,214
|
|
|
160,595
|
|
|
658,370
|
|
|
606,280
|
|
Non-Interest
Income
|
|
|
|
|
|
|
|
|
|
Trust and investment
services
|
2,932
|
|
|
3,062
|
|
|
2,733
|
|
|
11,538
|
|
|
10,345
|
|
Insurance
commissions
|
4,218
|
|
|
4,519
|
|
|
4,973
|
|
|
18,156
|
|
|
19,106
|
|
Service charges on
deposit accounts
|
5,393
|
|
|
5,558
|
|
|
5,419
|
|
|
21,529
|
|
|
20,879
|
|
(Losses) gains on
securities transactions, net
|
(25)
|
|
|
6
|
|
|
519
|
|
|
(20)
|
|
|
777
|
|
Fees from loan
servicing
|
1,843
|
|
|
1,895
|
|
|
1,688
|
|
|
7,384
|
|
|
6,441
|
|
Gains on sales of
loans, net
|
6,375
|
|
|
5,520
|
|
|
12,307
|
|
|
20,814
|
|
|
22,030
|
|
Bank owned life
insurance
|
1,633
|
|
|
1,541
|
|
|
1,230
|
|
|
7,338
|
|
|
6,694
|
|
Other
|
5,235
|
|
|
3,987
|
|
|
3,791
|
|
|
16,702
|
|
|
16,953
|
|
Total non-interest
income
|
27,604
|
|
|
26,088
|
|
|
32,660
|
|
|
103,441
|
|
|
103,225
|
|
Non-Interest
Expense
|
|
|
|
|
|
|
|
|
|
Salary and employee
benefits expense
|
62,453
|
|
|
67,062
|
|
|
61,415
|
|
|
254,569
|
|
|
235,853
|
|
Net occupancy and
equipment expense
|
23,843
|
|
|
22,756
|
|
|
21,525
|
|
|
92,243
|
|
|
87,140
|
|
FDIC insurance
assessment
|
5,163
|
|
|
4,603
|
|
|
5,102
|
|
|
19,821
|
|
|
20,100
|
|
Amortization of other
intangible assets
|
2,420
|
|
|
2,498
|
|
|
2,875
|
|
|
10,016
|
|
|
11,327
|
|
Professional and
legal fees
|
5,727
|
|
|
11,110
|
|
|
4,357
|
|
|
25,834
|
|
|
17,755
|
|
Amortization of tax
credit investments
|
20,302
|
|
|
8,389
|
|
|
13,384
|
|
|
41,747
|
|
|
34,744
|
|
Telecommunication
expense
|
2,091
|
|
|
2,464
|
|
|
2,882
|
|
|
9,921
|
|
|
10,021
|
|
Other
|
14,318
|
|
|
13,683
|
|
|
13,289
|
|
|
54,922
|
|
|
59,185
|
|
Total non-interest
expense
|
136,317
|
|
|
132,565
|
|
|
124,829
|
|
|
509,073
|
|
|
476,125
|
|
Income Before
Income Taxes
|
61,056
|
|
|
56,737
|
|
|
68,426
|
|
|
252,738
|
|
|
233,380
|
|
Income tax
expense
|
34,958
|
|
|
17,088
|
|
|
18,336
|
|
|
90,831
|
|
|
65,234
|
|
Net
Income
|
26,098
|
|
|
39,649
|
|
|
50,090
|
|
|
161,907
|
|
|
168,146
|
|
Dividends on
preferred stock
|
3,172
|
|
|
2,683
|
|
|
1,797
|
|
|
9,449
|
|
|
7,188
|
|
Net Income
Available to Common Shareholders
|
$
|
22,926
|
|
|
$
|
36,966
|
|
|
$
|
48,293
|
|
|
$
|
152,458
|
|
|
$
|
160,958
|
|
Earnings Per
Common Share:
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.09
|
|
|
$
|
0.14
|
|
|
$
|
0.19
|
|
|
$
|
0.58
|
|
|
$
|
0.63
|
|
Diluted
|
0.09
|
|
|
0.14
|
|
|
0.19
|
|
|
0.58
|
|
|
0.63
|
|
Cash Dividends
Declared per Common Share
|
0.11
|
|
|
0.11
|
|
|
0.11
|
|
|
0.44
|
|
|
0.44
|
|
Weighted Average
Number of Common Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
Basic
|
264,332,895
|
|
|
264,058,174
|
|
|
256,422,437
|
|
|
264,038,123
|
|
|
254,841,571
|
|
Diluted
|
265,288,067
|
|
|
264,936,220
|
|
|
256,952,036
|
|
|
264,889,007
|
|
|
255,268,336
|
|
|
VALLEY NATIONAL
BANCORP
|
|
Quarterly Analysis
of Average Assets, Liabilities and Shareholders' Equity
and
|
|
Net Interest
Income on a Tax Equivalent Basis
|
|
Three Months
Ended
|
|
December 31,
2017
|
|
September 30,
2017
|
|
December 31,
2016
|
|
Average
|
|
|
|
Avg.
|
|
Average
|
|
|
|
Avg.
|
|
Average
|
|
|
|
Avg.
|
($ in
thousands)
|
Balance
|
|
Interest
|
|
Rate
|
|
Balance
|
|
Interest
|
|
Rate
|
|
Balance
|
|
Interest
|
|
Rate
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest earning
assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans
(1)(2)
|
$
|
18,242,690
|
|
|
$
|
195,094
|
|
|
4.28
|
%
|
|
$
|
18,006,274
|
|
|
$
|
186,776
|
|
|
4.15
|
%
|
|
$
|
16,779,765
|
|
|
$
|
179,275
|
|
|
4.27
|
%
|
Taxable investments
(3)
|
2,931,144
|
|
|
21,104
|
|
|
2.88
|
%
|
|
2,905,400
|
|
|
20,579
|
|
|
2.83
|
%
|
|
2,680,175
|
|
|
17,454
|
|
|
2.60
|
%
|
Tax-exempt
investments (1)(3)
|
528,681
|
|
|
5,651
|
|
|
4.28
|
%
|
|
556,061
|
|
|
5,773
|
|
|
4.15
|
%
|
|
632,011
|
|
|
6,292
|
|
|
3.98
|
%
|
Federal funds sold
and other interest bearing deposits
|
230,002
|
|
|
637
|
|
|
1.11
|
%
|
|
175,111
|
|
|
546
|
|
|
1.25
|
%
|
|
296,535
|
|
|
280
|
|
|
0.38
|
%
|
Total interest
earning assets
|
21,932,517
|
|
|
222,486
|
|
|
4.06
|
%
|
|
21,642,846
|
|
|
213,674
|
|
|
3.95
|
%
|
|
20,388,486
|
|
|
203,301
|
|
|
3.99
|
%
|
Other
assets
|
1,974,494
|
|
|
|
|
|
|
1,961,406
|
|
|
|
|
|
|
2,291,505
|
|
|
|
|
|
Total
assets
|
$
|
23,907,011
|
|
|
|
|
|
|
$
|
23,604,252
|
|
|
|
|
|
|
$
|
22,679,991
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest bearing
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings, NOW and
money market deposits
|
$
|
9,085,986
|
|
|
$
|
16,762
|
|
|
0.74
|
%
|
|
$
|
8,799,955
|
|
|
$
|
15,641
|
|
|
0.71
|
%
|
|
$
|
9,034,605
|
|
|
$
|
10,418
|
|
|
0.46
|
%
|
Time
deposits
|
3,478,046
|
|
|
11,975
|
|
|
1.38
|
%
|
|
3,368,153
|
|
|
10,852
|
|
|
1.29
|
%
|
|
3,137,057
|
|
|
9,555
|
|
|
1.22
|
%
|
Short-term
borrowings
|
1,011,130
|
|
|
3,456
|
|
|
1.37
|
%
|
|
1,537,562
|
|
|
5,161
|
|
|
1.34
|
%
|
|
1,266,311
|
|
|
3,485
|
|
|
1.10
|
%
|
Long-term borrowings
(4)
|
2,344,220
|
|
|
16,344
|
|
|
2.79
|
%
|
|
2,032,068
|
|
|
15,142
|
|
|
2.98
|
%
|
|
1,490,187
|
|
|
13,242
|
|
|
3.55
|
%
|
Total interest
bearing liabilities
|
15,919,382
|
|
|
48,537
|
|
|
1.22
|
%
|
|
15,737,738
|
|
|
46,796
|
|
|
1.19
|
%
|
|
14,928,160
|
|
|
36,700
|
|
|
0.98
|
%
|
Non-interest bearing
deposits
|
5,248,311
|
|
|
|
|
|
|
5,184,991
|
|
|
|
|
|
|
5,256,984
|
|
|
|
|
|
Other
liabilities
|
176,992
|
|
|
|
|
|
|
178,985
|
|
|
|
|
|
|
190,639
|
|
|
|
|
|
Shareholders'
equity
|
2,562,326
|
|
|
|
|
|
|
2,502,538
|
|
|
|
|
|
|
2,304,208
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
$
|
23,907,011
|
|
|
|
|
|
|
$
|
23,604,252
|
|
|
|
|
|
|
$
|
22,679,991
|
|
|
|
|
|
Net interest
income/interest rate spread (5)
|
|
|
$
|
173,949
|
|
|
2.84
|
%
|
|
|
|
$
|
166,878
|
|
|
2.76
|
%
|
|
|
|
$
|
166,601
|
|
|
3.01
|
%
|
Tax equivalent
adjustment
|
|
|
(1,980)
|
|
|
|
|
|
|
(2,024)
|
|
|
|
|
|
|
(2,206)
|
|
|
|
Net interest income,
as reported
|
|
|
$
|
171,969
|
|
|
|
|
|
|
$
|
164,854
|
|
|
|
|
|
|
$
|
164,395
|
|
|
|
Net interest margin
(6)
|
|
|
|
|
3.14
|
%
|
|
|
|
|
|
3.05
|
%
|
|
|
|
|
|
3.23
|
%
|
Tax equivalent
effect
|
|
|
|
|
0.03
|
%
|
|
|
|
|
|
0.03
|
%
|
|
|
|
|
|
0.04
|
%
|
Net interest margin
on a fully tax
equivalent
basis (6)
|
|
|
|
|
3.17
|
%
|
|
|
|
|
|
3.08
|
%
|
|
|
|
|
|
3.27
|
%
|
(1)
|
Interest income is
presented on a tax equivalent basis using a 35 percent federal tax
rate. Effective January 1, 2018, Valley's federal tax rate
will decrease to 21 percent under the Tax Act.
|
(2)
|
Loans are stated net
of unearned income and include non-accrual loans.
|
(3)
|
The yield for
securities that are classified as available for sale is based on
the average historical amortized cost.
|
(4)
|
Includes junior
subordinated debentures issued to capital trusts which are
presented separately on the consolidated statements of
condition.
|
(5)
|
Interest rate spread
represents the difference between the average yield on interest
earning assets and the average cost of interest bearing liabilities
and is presented on a fully tax equivalent basis.
|
(6)
|
Net interest income
as a percentage of total average interest earning
assets.
|
View original
content:http://www.prnewswire.com/news-releases/valley-national-bancorp-reports-fourth-quarter-net-income-and-solid-net-interest-margin-300587951.html
SOURCE Valley National Bancorp