Valley National Bancorp (
NASDAQ:VLY), the holding
company for Valley National Bank, today reported net income for the
third quarter 2020 of $102.4 million, or $0.25 per diluted common
share, as compared to the third quarter 2019 earnings of $81.9
million, or $0.24 per diluted common share, and net income of $95.6
million, or $0.23 per diluted common share, for the second quarter
2020.
Key financial highlights for the third
quarter:
- Net Interest Income and Margin: Net interest
income on a tax equivalent basis of $284.1 million for the third
quarter 2020 increased $579 thousand as compared to the second
quarter 2020. The increase was largely due to a 13 basis point
decline in our funding costs caused by the continued downward
repricing of our interest bearing deposits, partially offset by
lower yields on new loan volumes and increased premium amortization
expense related to mortgage-backed investment securities. Our net
interest margin on a tax equivalent basis of 3.01 percent for the
third quarter 2020 increased by 1 basis point from 3.00 percent for
the second quarter 2020. See the "Net Interest Income and Margin"
section below for additional information.
- Loan Portfolio: Loans increased $101.0
million, to $32.4 billion at September 30, 2020 from
June 30, 2020. The increase was largely due to controlled
growth in our commercial real estate loan portfolio and a $63
million increase in SBA Paycheck Protection Program (PPP) loans
classified as commercial and industrial loans during the third
quarter. Third quarter new and refinanced loan originations
included approximately $386 million of residential mortgage loans
originated for sale rather than investment as compared to $296
million of such loans in the second quarter 2020. Net gains on
sales of residential loans were $13.4 million and $8.3 million in
the third quarter 2020 and second quarter 2020, respectively. See
the "Loans" section below for more details.
- Allowance and Provision for Credit Losses for
Loans: The allowance for credit losses for loans totaled
$335.3 million and $319.7 million at September 30, 2020 and
June 30, 2020, respectively. During the third quarter 2020,
the provision for credit losses for loans was $31.0 million as
compared to $41.1 million and $8.7 million for the second quarter
2020 and third quarter 2019, respectively. The reserve build in the
third quarter 2020 reflects several factors, including
deterioration in Valley's macroeconomic outlook since the end of
the second quarter, additional qualitative management adjustments
to reflect the potential for higher levels of credit stress related
to COVID-19 impacted borrowers, and the impact of lower valuations
of collateral securing our non-performing taxi medallion loan
portfolio.
- Credit Quality: Net loan charge-offs totaled
$15.4 million for the third quarter 2020 as compared to $14.8
million for the second quarter 2020. Net charge-offs remained
slightly elevated in the third quarter due to the full charge-off
of a $6.0 million non-performing commercial and industrial loan
relationship, as well as the partial charge-off of several taxi
medallion loans negatively impacted by lower collateral valuations
at September 30, 2020. Non-accrual loans decreased $19.5
million during the third quarter 2020 as compared to the second
quarter 2020 mostly due to the loan charge-offs, and represented
0.59 percent and 0.65 percent of total loans at September 30,
2020 and June 30, 2020, respectively. See the "Credit Quality"
Section below for more details.
- Non-interest Income: Non-interest income
increased $4.4 million to $49.3 million for the third quarter 2020
as compared to the second quarter 2020. The increase was mainly due
to increases of $5.0 million, $4.5 million and $1.2 million in net
gains on sales of residential mortgage loans, swap fee income
related to new commercial loan transactions and net gains on sales
of assets, respectively. BOLI income decreased $7.1 million as
compared to the second quarter 2020 largely due to periodic death
benefits received in the second quarter 2020 and a related credit
adjustment to the mortality contingency reserves component of our
BOLI assets recognized during the third quarter 2020.
- Loss on Extinguishment of Debt: In late
September 2020, we prepaid $50 million of long-term institutional
repo borrowings with an interest rate of 3.70 percent and an
original contractual maturity date in January 2022. The debt
prepayment was funded by excess cash liquidity. The transaction was
accounted for as an early debt extinguishment resulting in a loss,
reported within non-interest expense, of $2.4 million for the third
quarter 2020.
- Non-interest Expense: Non-interest expense
increased $3.0 million to $160.2 million for the third quarter 2020
as compared to the second quarter 2020 mainly due to a $5.1 million
increase in salaries and employee benefits expense and the $2.4
million loss on extinguishment of debt recognized during the third
quarter 2020. Salary and employee benefits increased due to several
factors, including higher cash incentive accruals, increased
medical and employer 401k expenses and a decline in
compensation-based deferred loan origination costs caused by lower
new loan volumes as compared to the second quarter 2020. The
negative impact of these items were partially offset by decreases
in net occupancy and equipment, the FDIC insurance assessment and
COVID-19 related expenses. COVID-19 related expenses totaled $1.2
million and $2.2 million for third quarter 2020 and second quarter
2020, respectively.
- Efficiency Ratio: Our efficiency ratio was
48.20 percent for the third quarter 2020 as compared to 48.01
percent and 55.73 percent for the second quarter 2020 and third
quarter 2019, respectively. Our adjusted efficiency ratio was 46.62
percent for the third quarter 2020 as compared to 46.84 percent and
53.48 percent for the second quarter 2020 and third quarter 2019,
respectively. See the "Consolidated Financial Highlights" tables
below for additional information regarding our non-GAAP
measures.
- Performance Ratios: Annualized return on
average assets (ROA), average shareholders’ equity (ROE) and
average tangible shareholders' equity (ROTE) were 0.99 percent,
9.04 percent, and 13.30 percent for the third quarter 2020,
respectively. Annualized ROA, ROE and ROTE, adjusted for non-core
charges, were 1.01 percent, 9.20 percent, and 13.53 percent for the
third quarter 2020, respectively. See the "Consolidated Financial
Highlights" tables below for additional information regarding our
non-GAAP measures.
Ira Robbins, CEO and President commented, "I'm
pleased to note that our third quarter earnings reflect the
strength of our balance sheet and Valley's ability to perform in a
stressed economic environment. As a result of the strong
performance of our margin, loan related gain and fee income and
controlled operating expenses, the adjusted efficiency ratio was
below 47 percent for the second consecutive quarter." Robbins
continued, "During the quarter, we witnessed signs of improved
financial health for many customers initially impacted by the
COVID-19 pandemic and other positive trends from the reopening of
certain markets, particularly in Florida. However, we continued to
work closely with other customers requiring hardship relief,
including loan forbearance, waived fees and other accommodations,
when appropriate. While we face a difficult and uncertain road
ahead, I remain confident that Valley's strong fundamentals and
commitment to its customers, employees and communities will
continue to standout in the future."
Net Interest Income and Margin
Net interest income on a tax equivalent basis
totaling $284.1 million for the third quarter 2020 increased $62.4
million as compared to the third quarter 2019 and increased $579
thousand as compared to the second quarter 2020. Our third quarter
2020 net interest income results benefited from the prudent
management of the level of interest rates offered on our deposits
products, as well as a shift in customer preference towards
deposits without stated maturities. Interest expense of $54.3
million for the third quarter 2020 decreased $11.7 million as
compared to the second quarter 2020 largely due to the maturity and
run-off of higher cost time deposits, reduced interest rates on all
deposit products and a reduction in average short-term borrowings
within our funding mix during the third quarter. Interest
income in the third quarter 2020 decreased by $11.1 million as
compared to the second quarter 2020 driven by (i) a $6.0 million
decrease in interest income from our loan portfolio largely caused
by new and refinanced loan originations at lower current interest
rates and a moderate decline in discount accretion related to
purchased credit deteriorated loans, and (ii) a $5.1 million
decrease in interest and dividends from investment securities due
to normal repayments of higher yielding securities and the
acceleration of premium amortization expense related to the
increased prepayment of mortgage-backed securities.
Our net interest margin on a tax equivalent
basis of 3.01 percent for the third quarter 2020 increased by 1
basis point and 10 basis points from 3.00 percent and 2.91 percent
for the second quarter 2020 and third quarter 2019, respectively.
The yield on average interest earning assets decreased by 12 basis
points on a linked quarter basis, mostly due to the impact of the
lower interest rate environment. The yield on average loans
decreased by 13 basis points to 3.89 percent for the third quarter
2020 as compared to the second quarter 2020 largely due to the
continued repayment of higher yielding loans and the lower yield on
new loans. The overall cost of average interest bearing liabilities
decreased 16 basis points to 0.80 percent for the third quarter
2020 as compared to the linked second quarter 2020 due to the lower
rates offered on deposit products, maturing time deposits and a
decrease in average short-term borrowings. Our cost of total
average deposits was 0.41 percent for the third quarter 2020 as
compared to 0.60 percent for the second quarter 2020.
Loans, Deposits and Other Borrowings
Loans. Loans increased $101.0
million to approximately $32.4 billion at September 30, 2020
from June 30, 2020 largely due to commercial real estate loan
growth and a $63 million increase in SBA PPP loans within the
commercial and industrial loan category during the third quarter
2020. Commercial real estate loans increased $244 million, or 5.9
percent on an annualized basis, to $16.8 billion at
September 30, 2020 as compared to June 30, 2020 mainly
due to our solid loan commitment pipeline at June 30, 2020 and
slower repayment activity in the third quarter. The residential
mortgage and most consumer loan categories experienced moderate
declines in the third quarter due to the impact of COVID-19,
including a higher level of residential mortgage loans originated
for sale due to current interest rate risk management strategies.
During the third quarter 2020, we originated $386 million of
residential mortgage loans for sale rather than held for
investment. Residential mortgage loans held for sale at fair value
totaled $209.3 million and $120.6 million at September 30,
2020 and June 30, 2020, respectively.
Deposits. Total deposits
decreased $132.2 million to approximately $31.3 billion at
September 30, 2020 from June 30, 2020 largely due to
decreases of $735.2 million and $232.9 million in time deposits and
non-interest bearing deposits, respectively, which were mostly
offset by an increase of $835.9 million in the money market, NOW
and savings account category. The decrease in time deposits was
driven by maturing high cost retail CDs and partial migration to
more liquid deposit product categories, while the decline in
non-interest bearing balances was partially caused by normal period
end fluctuations and lower deposit balances with PPP loan
customers. Total brokered deposits (consisting of both time and
money market deposit accounts) totaled $3.3 billion at
September 30, 2020 as compared to $3.6 billion at
June 30, 2020. Non-interest bearing deposits; savings, NOW and
money market deposits; and time deposits represented approximately
28 percent, 48 percent and 24 percent of total deposits as of
September 30, 2020, respectively.
Other Borrowings. Short-term
borrowings decreased by $652.2 million to $1.4 billion at
September 30, 2020 as compared to June 30, 2020 due to a
decline in overnight borrowings, comprised mainly of federal funds
purchased, and corresponding reduction in our excess liquidity
levels which were prudently elevated by management in the first
half of 2020. Long-term borrowings decreased by $55.0 million to
$2.9 billion at September 30, 2020 as compared to
June 30, 2020 mainly due to the prepayment of a $50 million
institutional repo borrowing with a stated interest rate of 3.7
percent. The prepayment resulted in a $2.4 million prepayment
penalty charge recognized in non-interest expense during the third
quarter 2020.
Credit Quality
Non-Performing Assets (NPAs).
Total NPAs, consisting of non-accrual loans, other real estate
owned (OREO), other repossessed assets and non-accrual debt
securities decreased $20.5 million to $203.6 million at
September 30, 2020 as compared to June 30, 2020. The
decrease in NPAs was mainly due to a $19.5 million decrease in
non-accrual loans caused by loan charge-offs within the commercial
and industrial loan category. Non-accrual loans represented 0.59
percent of total loans at September 30, 2020 compared to 0.65
percent at June 30, 2020.
Non-performing Taxi Medallion Loan
Portfolio. We continue to closely monitor our
non-performing New York City and Chicago taxi medallion loans
totaling $93.1 million and $7.0 million, respectively, within the
commercial and industrial loan portfolio at September 30,
2020. At September 30, 2020, the non-accrual taxi medallion
loans totaling $100.1 million had related reserves of $60.4 million
within the allowance for loan losses.
Accruing Past Due Loans. Total
accruing past due loans (i.e., loans past due 30 days or more and
still accruing interest) decreased $9.2 million to $83.9 million,
or 0.26 percent of total loans, at September 30, 2020 as
compared to $93.1 million, or 0.29 percent of total loans, at
June 30, 2020 mainly due to a decline in residential mortgage
and consumer loans in all delinquency categories. The decrease in
the residential and consumer delinquencies was largely due to
improved customer performance, including CARES Act qualifying
forbearance loans that resumed their scheduled monthly payments
during the third quarter 2020. Commercial real estate loans past
due 30 to 59 days increased by $12.1 million as compared to
June 30, 2020 mainly due to three loan relationships with a
combined total of $20.3 million reported in this delinquency
category at September 30, 2020. While the three loan
relationships are internally classified as substandard, management
believes they are well-secured and are currently in the process of
collection.
Forbearance. In response to the COVID-19
pandemic and its economic impact to certain customers, Valley
implemented short-term loan modifications such as payment
deferrals, fee waivers, extensions of repayment terms, or delays in
payment that are insignificant, when requested by customers.
Generally, the modification terms allow for a deferral of payments
for up to 90 days, which Valley may extend for an additional 90
days, for a maximum of 180 days on a cumulative and successive
basis. As of September 30, 2020, Valley had approximately $1.1
billion of outstanding loans remaining in their payment deferral
period under short-term modifications.
Allowance for Credit Losses for Loans
and Unfunded Commitments. The following table summarizes
the allocation of the allowance for credit losses to loan
categories and the allocation as a percentage of each loan category
at September 30, 2020, June 30, 2020, and
September 30, 2019:
|
|
September 30, 2020 |
|
June 30, 2020 |
|
September 30, 2019 |
|
|
|
|
Allocation |
|
|
|
Allocation |
|
|
|
Allocation |
|
|
|
|
as a % of |
|
|
|
as a % of |
|
|
|
as a % of |
|
|
Allowance |
|
Loan |
|
Allowance |
|
Loan |
|
Allowance |
|
Loan |
|
Allocation* |
|
Category |
|
Allocation* |
|
Category |
|
Allocation* |
|
Category |
|
|
|
($ in thousands) |
Loan
Category: |
|
|
|
|
|
|
|
|
|
|
|
Commercial and industrial loans |
$ |
130,409 |
|
|
1.89 |
% |
|
$ |
132,039 |
|
|
1.92 |
% |
|
$ |
101,002 |
|
|
2.15 |
% |
Commercial real
estate loans: |
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real estate |
128,699 |
|
|
0.77 |
% |
|
117,743 |
|
|
0.71 |
% |
|
23,044 |
|
|
0.17 |
% |
|
Construction |
15,951 |
|
|
0.93 |
% |
|
13,959 |
|
|
0.81 |
% |
|
25,727 |
|
|
1.67 |
% |
Total commercial
real estate loans |
144,650 |
|
|
0.78 |
% |
|
131,702 |
|
|
0.72 |
% |
|
48,771 |
|
|
0.33 |
% |
Residential
mortgage loans |
28,614 |
|
|
0.67 |
% |
|
29,630 |
|
|
0.67 |
% |
|
5,302 |
|
|
0.13 |
% |
Consumer
loans: |
|
|
|
|
|
|
|
|
|
|
|
|
Home equity |
5,972 |
|
|
1.31 |
% |
|
4,766 |
|
|
1.01 |
% |
|
487 |
|
|
0.10 |
% |
|
Auto and other consumer |
15,387 |
|
|
0.69 |
% |
|
11,477 |
|
|
0.51 |
% |
|
6,291 |
|
|
0.27 |
% |
Total consumer
loans |
21,359 |
|
|
0.79 |
% |
|
16,243 |
|
|
0.59 |
% |
|
6,778 |
|
|
0.24 |
% |
Allowance for loan
losses |
325,032 |
|
|
1.00 |
% |
|
309,614 |
|
|
0.96 |
% |
|
161,853 |
|
|
0.61 |
% |
Allowance for
unfunded credit commitments |
10,296 |
|
|
|
|
10,109 |
|
|
|
|
2,917 |
|
|
|
Total allowance
for credit losses for loans |
$ |
335,328 |
|
|
|
|
$ |
319,723 |
|
|
|
|
$ |
164,770 |
|
|
|
Allowance for
credit losses for |
|
|
|
|
|
|
|
|
|
|
|
loans as a % loans |
|
|
1.03 |
% |
|
|
|
0.99 |
% |
|
|
|
0.62 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
* |
CECL was adopted
January 1, 2020. Prior periods reflect the allowance for credit
losses for loans under the incurred loss model. |
Our loan portfolio, totaling $32.4 billion at
September 30, 2020, had net loan charge-offs totaling $15.4
million for the third quarter 2020 as compared to $14.8 million and
$2.0 million for the second quarter 2020 and third quarter 2019,
respectively. During the third quarter 2020, net loan charge-offs
were mainly driven by the full charge-off of a $6.0 million
non-performing commercial and industrial loan relationship, which
was fully reserved for in our allowance for loan losses at June 30,
2020. The commercial and industrial loan category also
included partial charge-offs of taxi medallion loans totaling $6.1
million for the third quarter 2020 as compared to $3.2 million for
the second quarter 2020. There were no taxi medallion loan
charge-offs during the third quarter 2019.
The allowance for credit losses for loans,
comprised of our allowance for loan losses and unfunded credit
commitments, as a percentage of total loans was 1.03 percent, 0.99
percent and 0.62 percent at September 30, 2020, June 30,
2020 and September 30, 2019, respectively. During the third
quarter 2020, we recorded a $31.0 million provision for credit
losses for loans as compared to $41.1 million and $8.7 million for
the second quarter 2020 and the third quarter 2019, respectively.
The reserve build in the third quarter 2020 reflects several
factors, including deterioration in Valley's macroeconomic outlook
since the end of the second quarter, additional qualitative
management adjustments to reflect the potential for higher levels
of credit stress related to COVID-19 impacted borrowers, and the
impact of lower valuations of collateral securing our
non-performing taxi medallion loan portfolio.
At September 30, 2020, the allowance
allocations for credit losses as a percentage of total loans
increased for most loan categories as compared to June 30,
2020. However, the allocated reserves as a percentage of
commercial and industrial loans declined by 0.03 percent largely
due to the aforementioned net loan charge-offs in the third quarter
2020, as well as moderate growth within the guaranteed PPP loan
portfolio which had no related allowance at September 30, 2020
and June 30, 2020.
Capital Adequacy
Valley's regulatory capital ratios continue to
reflect its well capitalized position. Valley's total risk-based
capital, common equity Tier 1 capital, Tier 1 capital and Tier 1
leverage capital ratios were 12.36 percent, 9.70 percent, 10.41
percent and 7.87 percent, respectively, at September 30,
2020.
For regulatory capital purposes, in connection
with the Federal Reserve Board’s final interim rule as of April 3,
2020, 100 percent of the CECL Day 1 impact to shareholders' equity
equaling $28.2 million after-tax will be deferred for a two-year
period ending January 1, 2022, at which time it will be phased in
on a pro-rata basis over a three-year period ending January 1,
2025. Additionally, 25 percent of the reserve build (i.e.,
provision for credit losses less net charge-offs) for the nine
months ended September 30, 2020 will be phased in over the same
time frame.
Investor Conference Call
Valley will host a conference call with
investors and the financial community at 11:00 AM Eastern Daylight
Time, today to discuss the third quarter 2020 earnings. Those
wishing to participate in the call may dial toll-free (866)
354-0432 Conference ID: 4969514. The teleconference will also be
webcast live: https://edge.media-server.com/mmc/p/27hm6386 [
edge.media-server.com ] and archived on Valley's website through
Friday, November 27, 2020. Investor presentation materials
will be made available prior to the conference call at
www.valley.com.
About Valley
As the principal subsidiary of Valley National
Bancorp, Valley National Bank is a regional bank with approximately
$41 billion in assets. Valley is committed to giving people and
businesses the power to succeed. Valley operates many convenient
branch locations across New Jersey, New York, Florida and Alabama,
and is committed to providing the most convenient service, the
latest innovations and an experienced and knowledgeable team
dedicated to meeting customer needs. Helping communities grow and
prosper is the heart of Valley’s corporate citizenship philosophy.
To learn more about Valley, go to www.valley.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,
including the potential effects of the COVID-19 pandemic on our
businesses and financial results and conditions. 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:
- the impact of COVID-19 on the U.S. and the global
economies, including business disruptions, reductions in employment
and an increase in business failures, specifically the consequences
among our commercial and consumer customers;
- the impact of COVID-19 on our employees and our ability to
provide services to our customers and respond to their needs as
more cases of COVID-19 may arise in our primary markets;
- potential judgments, claims, damages, penalties, fines and
reputational damage resulting from pending or future litigation and
regulatory and government actions, including as a result of our
participation in and execution of government programs related to
the COVID-19 pandemic or as a result of our action, or failure to
implement or effectively implement, federal, state and local laws,
rules or executive orders requiring that we grant forbearances or
not act to collect our loans;
- the impact of forbearances or deferrals we are required or
agree to as a result of customer requests and/or government
actions, including, but not limited to our potential inability to
recover fully deferred payments from the borrower or the
collateral;
- damage verdicts or settlements or restrictions related to
existing or potential class action litigation or individual
litigation arising from claims of violations of laws or
regulations, contractual claims, breach of fiduciary
responsibility, negligence, fraud, environmental laws, patent or
trademark infringement, employment related claims, and other
matters;
- a prolonged downturn 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;
- higher or lower than expected income tax expense or tax rates,
including increases or decreases resulting from changes in
uncertain tax position liabilities, tax laws, regulations and case
law;
- the inability to grow customer deposits to keep pace with loan
growth;
- a material change in our allowance for credit losses under CECL
due to forecasted economic conditions and/or unexpected credit
deterioration in our loan and investment portfolios;
- the need to supplement debt or equity capital to maintain or
exceed internal capital thresholds;
- greater than expected technology related costs due to, among
other factors, prolonged or failed implementations, additional
project staffing and obsolescence caused by continuous and rapid
market innovations;
- the loss of or decrease in lower-cost funding sources within
our deposit base, including our inability to achieve deposit
retention targets under Valley's branch transformation
strategy;
- 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,
reimburse customers, change the way we do business, or limit or
eliminate certain other banking activities;
- our inability or determination not to pay dividends at current
levels, or at all, because of inadequate earnings, regulatory
restrictions or limitations, changes in our capital requirements or
a decision to increase capital by retaining more earnings;
- unanticipated loan delinquencies, loss of collateral, decreased
service revenues, and other potential negative effects on our
business caused by severe weather, the COVID-19 pandemic 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; and
- the failure of other financial institutions with whom we have
trading, clearing, counterparty and other financial
relationships.
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, 2019 and in Item 1A of our Quarterly
Report on Form 10-Q for the quarter ended June 30, 2020.
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.
-Tables to Follow-
VALLEY NATIONAL BANCORPCONSOLIDATED
FINANCIAL HIGHLIGHTS
SELECTED FINANCIAL DATA
|
Three Months Ended |
|
Nine Months Ended |
|
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
($ in thousands, except for
share data) |
2020 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
FINANCIAL
DATA: |
|
|
|
|
|
|
|
|
|
Net interest income - FTE (1) |
$ |
284,119 |
|
|
$ |
283,540 |
|
|
$ |
221,747 |
|
|
$ |
834,042 |
|
|
$ |
663,064 |
|
Net interest income |
$ |
283,086 |
|
|
$ |
282,559 |
|
|
$ |
220,625 |
|
|
$ |
830,984 |
|
|
$ |
659,507 |
|
Non-interest income |
49,272 |
|
|
44,830 |
|
|
41,150 |
|
|
135,499 |
|
|
176,426 |
|
Total revenue |
332,358 |
|
|
327,389 |
|
|
261,775 |
|
|
966,483 |
|
|
835,933 |
|
Non-interest expense |
160,185 |
|
|
157,166 |
|
|
145,877 |
|
|
473,007 |
|
|
435,409 |
|
Pre-provision net revenue |
172,173 |
|
|
170,223 |
|
|
115,898 |
|
|
493,476 |
|
|
400,524 |
|
Provision for credit
losses |
30,908 |
|
|
41,156 |
|
|
8,700 |
|
|
106,747 |
|
|
18,800 |
|
Income tax expense |
38,891 |
|
|
33,466 |
|
|
25,307 |
|
|
101,486 |
|
|
110,035 |
|
Net income |
102,374 |
|
|
95,601 |
|
|
81,891 |
|
|
285,243 |
|
|
271,689 |
|
Dividends on preferred
stock |
3,172 |
|
|
3,172 |
|
|
3,172 |
|
|
9,516 |
|
|
9,516 |
|
Net income available to common
shareholders |
$ |
99,202 |
|
|
$ |
92,429 |
|
|
$ |
78,719 |
|
|
$ |
275,727 |
|
|
$ |
262,173 |
|
Weighted average number of
common shares outstanding: |
|
|
|
|
|
|
|
|
|
Basic |
403,833,469 |
|
|
403,790,242 |
|
|
331,797,982 |
|
|
403,714,701 |
|
|
331,716,652 |
|
Diluted |
404,788,526 |
|
|
404,631,845 |
|
|
333,405,196 |
|
|
404,912,126 |
|
|
333,039,436 |
|
Per common share data: |
|
|
|
|
|
|
|
|
|
Basic earnings |
$ |
0.25 |
|
|
$ |
0.23 |
|
|
$ |
0.24 |
|
|
$ |
0.68 |
|
|
$ |
0.79 |
|
Diluted earnings |
0.25 |
|
|
0.23 |
|
|
0.24 |
|
|
0.68 |
|
|
0.79 |
|
Cash dividends declared |
0.11 |
|
|
0.11 |
|
|
0.11 |
|
|
0.33 |
|
|
0.33 |
|
Closing stock price -
high |
8.33 |
|
|
9.60 |
|
|
11.21 |
|
|
11.46 |
|
|
11.21 |
|
Closing stock price - low |
6.60 |
|
|
6.29 |
|
|
10.04 |
|
|
6.29 |
|
|
9.00 |
|
CORE ADJUSTED
FINANCIAL DATA: (2) |
|
|
|
|
|
|
|
|
|
Net income available to common
shareholders, as adjusted |
$ |
101,002 |
|
|
$ |
92,721 |
|
|
$ |
79,962 |
|
|
$ |
278,784 |
|
|
$ |
227,340 |
|
Basic earnings per share, as
adjusted |
0.25 |
|
|
0.23 |
|
|
0.24 |
|
|
0.69 |
|
|
0.69 |
|
Diluted earnings per share, as
adjusted |
0.25 |
|
|
0.23 |
|
|
0.24 |
|
|
0.69 |
|
|
0.68 |
|
FINANCIAL
RATIOS: |
|
|
|
|
|
|
|
|
|
Net interest margin |
3.00 |
% |
|
2.99 |
% |
|
2.89 |
% |
|
3.02 |
% |
|
2.93 |
% |
Net interest margin - FTE
(1) |
3.01 |
|
|
3.00 |
|
|
2.91 |
|
|
3.03 |
|
|
2.95 |
|
Annualized return on average
assets |
0.99 |
|
|
0.92 |
|
|
0.98 |
|
|
0.94 |
|
|
1.10 |
|
Annualized return on avg.
shareholders' equity |
9.04 |
|
|
8.54 |
|
|
9.26 |
|
|
8.50 |
|
|
10.44 |
|
Annualized return on avg.
tangible shareholders' equity (2) |
13.30 |
|
|
12.66 |
|
|
13.75 |
|
|
12.61 |
|
|
15.65 |
|
Efficiency ratio (3) |
48.20 |
|
|
48.01 |
|
|
55.73 |
|
|
48.94 |
|
|
52.09 |
|
CORE ADJUSTED
FINANCIAL RATIOS: (2) |
|
|
|
|
|
|
|
|
|
Annualized return on average
assets, as adjusted |
1.01 |
% |
|
0.92 |
% |
|
1.00 |
% |
|
0.95 |
% |
|
0.96 |
% |
Annualized return on average
shareholders' equity, as adjusted |
9.20 |
|
|
8.57 |
|
|
9.40 |
|
|
8.59 |
|
|
9.10 |
|
Annualized return on average
tangible shareholders' equity, as adjusted |
13.53 |
|
|
12.70 |
|
|
13.96 |
|
|
12.75 |
|
|
13.65 |
|
Efficiency ratio, as
adjusted |
46.62 |
|
|
46.84 |
|
|
53.48 |
|
|
47.53 |
|
|
54.27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VALLEY NATIONAL BANCORPCONSOLIDATED
FINANCIAL HIGHLIGHTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
AVERAGE BALANCE SHEET
ITEMS: |
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
(In thousands) |
2020 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Assets |
$ |
41,457,515 |
|
|
$ |
41,503,514 |
|
|
$ |
33,419,137 |
|
|
$ |
40,356,828 |
|
|
$ |
32,811,565 |
|
Interest earning assets |
37,767,710 |
|
|
37,778,387 |
|
|
30,494,569 |
|
|
36,743,807 |
|
|
29,981,699 |
|
Loans |
32,515,264 |
|
|
32,041,200 |
|
|
26,136,745 |
|
|
31,522,268 |
|
|
25,651,195 |
|
Interest bearing
liabilities |
27,163,568 |
|
|
27,578,741 |
|
|
22,858,121 |
|
|
26,986,611 |
|
|
22,512,114 |
|
Deposits |
31,491,471 |
|
|
30,837,963 |
|
|
24,836,349 |
|
|
30,384,511 |
|
|
24,772,979 |
|
Shareholders' equity |
4,530,671 |
|
|
4,477,446 |
|
|
3,536,528 |
|
|
4,472,447 |
|
|
3,471,432 |
|
|
As Of |
BALANCE SHEET
ITEMS: |
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
(In thousands) |
2020 |
|
2020 |
|
2020 |
|
2019 |
|
2019 |
Assets |
$ |
40,855,333 |
|
|
$ |
41,717,265 |
|
|
$ |
39,120,629 |
|
|
$ |
37,436,020 |
|
|
$ |
33,765,539 |
|
Total loans |
32,415,586 |
|
|
32,314,611 |
|
|
30,428,067 |
|
|
29,699,208 |
|
|
26,567,159 |
|
Deposits |
31,295,823 |
|
|
31,428,005 |
|
|
29,016,988 |
|
|
29,185,837 |
|
|
25,546,122 |
|
Shareholders' equity |
4,533,763 |
|
|
4,474,488 |
|
|
4,420,998 |
|
|
4,384,188 |
|
|
3,558,075 |
|
|
|
|
|
|
|
|
|
|
|
LOANS: |
|
|
|
|
|
|
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
|
Commercial and industrial |
$ |
6,903,345 |
|
|
$ |
6,884,689 |
|
|
$ |
4,998,731 |
|
|
$ |
4,825,997 |
|
|
$ |
4,695,608 |
|
Commercial real estate: |
|
|
|
|
|
|
|
|
|
Commercial real estate |
16,815,587 |
|
|
16,571,877 |
|
|
16,390,236 |
|
|
15,996,741 |
|
|
13,365,454 |
|
Construction |
1,720,775 |
|
|
1,721,352 |
|
|
1,727,046 |
|
|
1,647,018 |
|
|
1,537,590 |
|
Total commercial real estate |
18,536,362 |
|
|
18,293,229 |
|
|
18,117,282 |
|
|
17,643,759 |
|
|
14,903,044 |
|
Residential mortgage |
4,284,595 |
|
|
4,405,147 |
|
|
4,478,982 |
|
|
4,377,111 |
|
|
4,133,331 |
|
Consumer: |
|
|
|
|
|
|
|
|
|
Home equity |
457,083 |
|
|
471,115 |
|
|
481,751 |
|
|
487,272 |
|
|
489,808 |
|
Automobile |
1,341,659 |
|
|
1,369,489 |
|
|
1,436,734 |
|
|
1,451,623 |
|
|
1,436,608 |
|
Other consumer |
892,542 |
|
|
890,942 |
|
|
914,587 |
|
|
913,446 |
|
|
908,760 |
|
Total consumer loans |
2,691,284 |
|
|
2,731,546 |
|
|
2,833,072 |
|
|
2,852,341 |
|
|
2,835,176 |
|
Total loans |
$ |
32,415,586 |
|
|
$ |
32,314,611 |
|
|
$ |
30,428,067 |
|
|
$ |
29,699,208 |
|
|
$ |
26,567,159 |
|
|
|
|
|
|
|
|
|
|
|
CAPITAL
RATIOS: |
|
|
|
|
|
|
|
|
|
Book value per common
share |
$ |
10.71 |
|
|
$ |
10.56 |
|
|
$ |
10.43 |
|
|
$ |
10.35 |
|
|
$ |
10.09 |
|
Tangible book value per common
share (2) |
7.12 |
|
|
6.96 |
|
|
6.82 |
|
|
6.73 |
|
|
6.62 |
|
Tangible common equity to
tangible assets (2) |
7.30 |
% |
|
6.98 |
% |
|
7.31 |
% |
|
7.54 |
% |
|
6.73 |
% |
Tier 1 leverage capital |
7.87 |
|
|
7.70 |
|
|
8.24 |
|
|
8.76 |
|
|
7.61 |
|
Common equity tier 1
capital |
9.70 |
|
|
9.51 |
|
|
9.24 |
|
|
9.42 |
|
|
8.49 |
|
Tier 1 risk-based capital |
10.41 |
|
|
10.23 |
|
|
9.95 |
|
|
10.15 |
|
|
9.30 |
|
Total risk-based capital |
12.36 |
|
|
12.19 |
|
|
11.53 |
|
|
11.72 |
|
|
11.03 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VALLEY NATIONAL
BANCORPCONSOLIDATED FINANCIAL
HIGHLIGHTS
|
Three Months Ended |
|
Nine Months Ended |
ALLOWANCE FOR CREDIT
LOSSES |
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
($ in thousands) |
2020 |
|
2020 |
|
|
2019 |
|
|
2020 |
|
2019 |
|
Allowance for credit
losses for loans |
|
|
|
|
|
|
|
|
|
Beginning balance |
$ |
319,723 |
|
|
|
$ |
293,361 |
|
|
$ |
158,079 |
|
|
$ |
164,604 |
|
|
|
$ |
156,295 |
|
Impact of the adoption of ASU 2016-13 (4) |
— |
|
|
|
— |
|
|
— |
|
|
37,989 |
|
|
|
— |
|
Allowance for purchased credit deteriorated (PCD) loans |
— |
|
|
|
— |
|
|
— |
|
|
61,643 |
|
|
|
— |
|
Beginning balance,
adjusted |
319,723 |
|
|
|
293,361 |
|
|
158,079 |
|
|
264,236 |
|
|
|
156,295 |
|
Loans charged-off (5): |
|
|
|
|
|
|
|
|
|
Commercial and industrial |
(13,965 |
) |
|
|
(14,024 |
) |
|
(527 |
) |
|
(31,349 |
) |
|
|
(7,882 |
) |
Commercial real estate |
(695 |
) |
|
|
(27 |
) |
|
(158 |
) |
|
(766 |
) |
|
|
(158 |
) |
Residential mortgage |
(7 |
) |
|
|
(5 |
) |
|
(111 |
) |
|
(348 |
) |
|
|
(126 |
) |
Total Consumer |
(2,458 |
) |
|
|
(2,601 |
) |
|
(2,191 |
) |
|
(7,624 |
) |
|
|
(5,971 |
) |
Total loans charged-off |
(17,125 |
) |
|
|
(16,657 |
) |
|
(2,987 |
) |
|
(40,087 |
) |
|
|
(14,137 |
) |
Charged-off loans recovered
(5): |
|
|
|
|
|
|
|
|
|
Commercial and industrial |
428 |
|
|
|
799 |
|
|
330 |
|
|
1,796 |
|
|
|
2,008 |
|
Commercial real estate |
60 |
|
|
|
31 |
|
|
28 |
|
|
164 |
|
|
|
71 |
|
Construction |
40 |
|
|
|
20 |
|
|
— |
|
|
80 |
|
|
|
— |
|
Residential mortgage |
31 |
|
|
|
545 |
|
|
3 |
|
|
626 |
|
|
|
13 |
|
Total Consumer |
1,151 |
|
|
|
509 |
|
|
617 |
|
|
2,454 |
|
|
|
1,720 |
|
Total loans recovered |
1,710 |
|
|
|
1,904 |
|
|
978 |
|
|
5,120 |
|
|
|
3,812 |
|
Net charge-offs |
(15,415 |
) |
|
|
(14,753 |
) |
|
(2,009 |
) |
|
(34,967 |
) |
|
|
(10,325 |
) |
Provision for credit losses
for loans |
31,020 |
|
|
|
41,115 |
|
|
8,700 |
|
|
106,059 |
|
|
|
18,800 |
|
Ending balance |
$ |
335,328 |
|
|
|
$ |
319,723 |
|
|
$ |
164,770 |
|
|
$ |
335,328 |
|
|
|
$ |
164,770 |
|
Components of
allowance for credit losses for loans: |
|
|
|
|
|
|
|
|
|
Allowance for loan losses |
$ |
325,032 |
|
|
|
$ |
309,614 |
|
|
$ |
161,853 |
|
|
$ |
325,032 |
|
|
|
$ |
161,853 |
|
Allowance for unfunded credit commitments |
10,296 |
|
|
|
10,109 |
|
|
2,917 |
|
|
10,296 |
|
|
|
2,917 |
|
Allowance for credit losses
for loans |
$ |
335,328 |
|
|
|
$ |
319,723 |
|
|
$ |
164,770 |
|
|
$ |
335,328 |
|
|
|
$ |
164,770 |
|
Components of
provision for credit losses for loans: |
|
|
|
|
|
|
|
|
|
Provision for credit losses for loans |
$ |
30,833 |
|
|
|
$ |
41,025 |
|
|
$ |
8,757 |
|
|
$ |
105,709 |
|
|
|
$ |
20,319 |
|
Provision for unfunded credit commitments (6) |
187 |
|
|
|
90 |
|
|
(57 |
) |
|
350 |
|
|
|
(1,519 |
) |
Total provision for credit
losses for loans |
$ |
31,020 |
|
|
|
$ |
41,115 |
|
|
$ |
8,700 |
|
|
$ |
106,059 |
|
|
|
$ |
18,800 |
|
Annualized ratio of total net
charge-offs to average loans |
0.19 |
|
% |
|
|
0.18 |
% |
|
|
0.03 |
% |
|
0.15 |
|
% |
|
|
0.05 |
% |
Allowance for credit losses
for loans as a % of total loans |
1.03 |
|
|
|
|
0.99 |
|
|
|
0.62 |
|
|
1.03 |
|
|
|
|
0.62 |
|
VALLEY NATIONAL
BANCORPCONSOLIDATED FINANCIAL
HIGHLIGHTS
|
As of |
ASSET
QUALITY: (7) |
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
($ in thousands) |
2020 |
|
2020 |
|
2020 |
|
2019 |
|
2019 |
Accruing past due loans: |
|
|
|
|
|
|
|
|
|
30 to 59 days past due: |
|
|
|
|
|
|
|
|
|
Commercial and industrial |
$ |
6,587 |
|
|
$ |
6,206 |
|
|
$ |
9,780 |
|
|
$ |
11,700 |
|
|
$ |
5,702 |
|
Commercial real estate |
26,038 |
|
|
13,912 |
|
|
41,664 |
|
|
2,560 |
|
|
20,851 |
|
Construction |
142 |
|
|
— |
|
|
7,119 |
|
|
1,486 |
|
|
11,523 |
|
Residential mortgage |
22,528 |
|
|
35,263 |
|
|
38,965 |
|
|
17,143 |
|
|
12,945 |
|
Total Consumer |
8,979 |
|
|
12,962 |
|
|
19,508 |
|
|
13,704 |
|
|
13,079 |
|
Total 30 to 59 days past
due |
64,274 |
|
|
68,343 |
|
|
117,036 |
|
|
46,593 |
|
|
64,100 |
|
60 to 89 days past due: |
|
|
|
|
|
|
|
|
|
Commercial and industrial |
3,954 |
|
|
4,178 |
|
|
7,624 |
|
|
2,227 |
|
|
3,158 |
|
Commercial real estate |
610 |
|
|
1,543 |
|
|
15,963 |
|
|
4,026 |
|
|
735 |
|
Construction |
— |
|
|
— |
|
|
49 |
|
|
1,343 |
|
|
7,129 |
|
Residential mortgage |
3,760 |
|
|
4,169 |
|
|
9,307 |
|
|
4,192 |
|
|
4,417 |
|
Total Consumer |
1,352 |
|
|
3,786 |
|
|
2,309 |
|
|
2,527 |
|
|
1,577 |
|
Total 60 to 89 days past
due |
9,676 |
|
|
13,676 |
|
|
35,252 |
|
|
14,315 |
|
|
17,016 |
|
90 or more days past due: |
|
|
|
|
|
|
|
|
|
Commercial and industrial |
6,759 |
|
|
5,220 |
|
|
4,049 |
|
|
3,986 |
|
|
4,133 |
|
Commercial real estate |
1,538 |
|
|
— |
|
|
161 |
|
|
579 |
|
|
1,125 |
|
Residential mortgage |
891 |
|
|
3,812 |
|
|
1,798 |
|
|
2,042 |
|
|
1,347 |
|
Total Consumer |
753 |
|
|
2,082 |
|
|
1,092 |
|
|
711 |
|
|
756 |
|
Total 90 or more days past
due |
9,941 |
|
|
11,114 |
|
|
7,100 |
|
|
7,318 |
|
|
7,361 |
|
Total accruing past due
loans |
$ |
83,891 |
|
|
$ |
93,133 |
|
|
$ |
159,388 |
|
|
$ |
68,226 |
|
|
$ |
88,477 |
|
Non-accrual loans: |
|
|
|
|
|
|
|
|
|
Commercial and industrial |
$ |
115,667 |
|
|
$ |
130,876 |
|
|
$ |
132,622 |
|
|
$ |
68,636 |
|
|
$ |
75,311 |
|
Commercial real estate |
41,627 |
|
|
43,678 |
|
|
41,616 |
|
|
9,004 |
|
|
9,560 |
|
Construction |
2,497 |
|
|
3,308 |
|
|
2,972 |
|
|
356 |
|
|
356 |
|
Residential mortgage |
23,877 |
|
|
25,776 |
|
|
24,625 |
|
|
12,858 |
|
|
13,772 |
|
Total Consumer |
7,441 |
|
|
6,947 |
|
|
4,095 |
|
|
2,204 |
|
|
2,050 |
|
Total non-accrual loans |
191,109 |
|
|
210,585 |
|
|
205,930 |
|
|
93,058 |
|
|
101,049 |
|
Other real estate owned
(OREO) |
7,746 |
|
|
8,283 |
|
|
10,198 |
|
|
9,414 |
|
|
6,415 |
|
Other repossessed assets |
3,988 |
|
|
3,920 |
|
|
3,842 |
|
|
1,276 |
|
|
2,568 |
|
Non-accrual debt
securities |
783 |
|
|
1,365 |
|
|
531 |
|
|
680 |
|
|
680 |
|
Total non-performing
assets |
$ |
203,626 |
|
|
$ |
224,153 |
|
|
$ |
220,501 |
|
|
$ |
104,428 |
|
|
$ |
110,712 |
|
Performing troubled debt
restructured loans |
$ |
58,090 |
|
|
$ |
53,936 |
|
|
$ |
48,024 |
|
|
$ |
73,012 |
|
|
$ |
79,364 |
|
Total non-accrual loans as a %
of loans |
0.59 |
% |
|
0.65 |
% |
|
0.68 |
% |
|
0.31 |
% |
|
0.38 |
% |
Total accruing past due and
non-accrual loans as a % of loans |
0.85 |
% |
|
0.94 |
% |
|
1.20 |
% |
|
0.54 |
% |
|
0.71 |
% |
Allowance for losses on loans
as a % of non-accrual loans |
170.08 |
% |
|
147.03 |
% |
|
137.59 |
% |
|
173.83 |
% |
|
160.17 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VALLEY NATIONAL
BANCORPCONSOLIDATED FINANCIAL
HIGHLIGHTS
NOTES TO SELECTED FINANCIAL DATA
(1 |
) |
Net interest income and net interest margin are presented on a tax
equivalent basis using a 21 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 |
|
Nine Months Ended |
|
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
($ in thousands, except for
share data) |
2020 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Adjusted net income
available to common shareholders: |
|
|
|
|
|
|
|
|
|
Net income, as reported |
$ |
102,374 |
|
|
$ |
95,601 |
|
|
$ |
81,891 |
|
|
$ |
285,243 |
|
|
$ |
271,689 |
|
|
Less: Gain on sale leaseback transactions (net of tax)(a) |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(55,707 |
) |
|
Add: Loss on extinguishment of debt (net of tax) |
1,691 |
|
|
— |
|
|
— |
|
|
1,691 |
|
|
— |
|
|
Add: Net impairment losses on securities (net of tax) |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2,078 |
|
|
Add: Losses on securities transaction (net of tax) |
33 |
|
|
29 |
|
|
67 |
|
|
91 |
|
|
82 |
|
|
Add: Severance expense (net of tax)(b) |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
3,433 |
|
|
Add: Tax credit investment impairment (net of tax)(c) |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1,757 |
|
|
Add: Merger related expenses (net of tax)(d) |
76 |
|
|
263 |
|
|
1,043 |
|
|
1,275 |
|
|
1,068 |
|
|
Add: Income tax expense (e) |
— |
|
|
— |
|
|
133 |
|
|
— |
|
|
12,456 |
|
|
Net income, as adjusted |
$ |
104,174 |
|
|
$ |
95,893 |
|
|
$ |
83,134 |
|
|
$ |
288,300 |
|
|
$ |
236,856 |
|
|
Dividends on preferred
stock |
3,172 |
|
|
3,172 |
|
|
3,172 |
|
|
9,516 |
|
|
9,516 |
|
|
Net income available to common
shareholders, as adjusted |
$ |
101,002 |
|
|
$ |
92,721 |
|
|
$ |
79,962 |
|
|
$ |
278,784 |
|
|
$ |
227,340 |
|
|
__________ |
|
|
|
|
|
|
|
|
|
(a) The gain on sale leaseback transactions is included in
gains on the sales of assets within other non-interest income. |
|
|
(b) Severance expense is included in salary and employee
benefits expense. |
|
|
|
|
(c) Impairment is included in the amortization of tax credit
investments. |
|
|
|
|
(d) Merger related expenses are primarily within salary and
employee benefits expense, professional and legal fees, and other
expense. |
(e) Income tax expense related to reserves for uncertain tax
positions. |
Adjusted per common
share data: |
|
|
|
|
|
|
|
|
|
Net income available to common
shareholders, as adjusted |
$ |
101,002 |
|
|
$ |
92,721 |
|
|
$ |
79,962 |
|
|
$ |
278,784 |
|
|
$ |
227,340 |
|
|
Average number of shares
outstanding |
403,833,469 |
|
|
403,790,242 |
|
|
331,797,982 |
|
|
403,714,701 |
|
|
331,716,652 |
|
|
Basic earnings, as adjusted |
$ |
0.25 |
|
|
$ |
0.23 |
|
|
$ |
0.24 |
|
|
$ |
0.69 |
|
|
$ |
0.69 |
|
|
Average number of diluted
shares outstanding |
404,788,526 |
|
|
404,631,845 |
|
|
333,405,196 |
|
|
404,912,126 |
|
|
333,039,436 |
|
|
Diluted earnings, as adjusted |
$ |
0.25 |
|
|
$ |
0.23 |
|
|
$ |
0.24 |
|
|
$ |
0.69 |
|
|
$ |
0.68 |
|
|
Adjusted annualized
return on average tangible shareholders' equity: |
|
|
|
|
|
|
|
|
|
Net income, as adjusted |
$ |
104,174 |
|
|
$ |
95,893 |
|
|
$ |
83,134 |
|
|
$ |
288,300 |
|
|
$ |
236,856 |
|
|
Average shareholders'
equity |
4,530,671 |
|
|
4,477,446 |
|
|
3,536,528 |
|
|
4,472,447 |
|
|
3,471,432 |
|
|
Less: Average goodwill and other intangible assets |
1,451,889 |
|
|
1,456,781 |
|
|
1,154,462 |
|
|
1,456,536 |
|
|
1,157,203 |
|
|
Average tangible shareholders'
equity |
$ |
3,078,782 |
|
|
$ |
3,020,665 |
|
|
$ |
2,382,066 |
|
|
$ |
3,015,911 |
|
|
$ |
2,314,229 |
|
|
Annualized return on average
tangible shareholders' equity, as adjusted |
13.53 |
% |
|
12.70 |
% |
|
13.96 |
% |
|
12.75 |
% |
|
13.65 |
|
% |
Adjusted annualized
return on average assets: |
|
|
|
|
|
|
|
|
|
Net income, as adjusted |
$ |
104,174 |
|
|
$ |
95,893 |
|
|
$ |
83,134 |
|
|
$ |
288,300 |
|
|
$ |
236,856 |
|
|
Average assets |
$ |
41,457,515 |
|
|
$ |
41,503,514 |
|
|
$ |
33,419,137 |
|
|
$ |
40,356,828 |
|
|
$ |
32,811,565 |
|
|
Annualized return on average
assets, as adjusted |
1.01 |
% |
|
0.92 |
% |
|
1.00 |
% |
|
0.95 |
% |
|
0.96 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VALLEY NATIONAL
BANCORPCONSOLIDATED FINANCIAL
HIGHLIGHTS
|
Three Months Ended |
|
Nine Months Ended |
|
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
($ in thousands) |
2020 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Adjusted annualized return on average shareholders'
equity: |
|
|
|
|
|
|
|
|
|
Net income, as adjusted |
$ |
104,174 |
|
|
$ |
95,893 |
|
|
$ |
83,134 |
|
|
$ |
288,300 |
|
|
$ |
236,856 |
|
Average shareholders' equity |
$ |
4,530,671 |
|
|
$ |
4,477,446 |
|
|
$ |
3,536,528 |
|
|
$ |
4,472,447 |
|
|
$ |
3,471,432 |
|
Annualized return on average shareholders' equity, as adjusted |
9.20 |
% |
|
8.57 |
% |
|
9.40 |
% |
|
8.59 |
% |
|
9.10 |
% |
Annualized return on average tangible shareholders'
equity: |
|
|
|
|
|
|
|
|
|
Net income, as reported |
$ |
102,374 |
|
|
$ |
95,601 |
|
|
$ |
81,891 |
|
|
$ |
285,243 |
|
|
$ |
271,689 |
|
Average shareholders' equity |
4,530,671 |
|
|
4,477,446 |
|
|
3,536,528 |
|
|
4,472,447 |
|
|
3,471,432 |
|
Less: Average goodwill and other intangible assets |
1,451,889 |
|
|
1,456,781 |
|
|
1,154,462 |
|
|
1,456,536 |
|
|
1,157,203 |
|
Average tangible shareholders' equity |
$ |
3,078,782 |
|
|
$ |
3,020,665 |
|
|
$ |
2,382,066 |
|
|
$ |
3,015,911 |
|
|
$ |
2,314,229 |
|
Annualized return on average tangible shareholders' equity |
13.30 |
% |
|
12.66 |
% |
|
13.75 |
% |
|
12.61 |
% |
|
15.65 |
% |
Adjusted efficiency ratio: |
|
|
|
|
|
|
|
|
|
Non-interest expense, as reported |
$ |
160,185 |
|
|
$ |
157,166 |
|
|
$ |
145,877 |
|
|
$ |
473,007 |
|
|
$ |
435,409 |
|
Less: Loss on extinguishment of debt (pre-tax) |
2,353 |
|
|
— |
|
|
— |
|
|
2,353 |
|
|
— |
|
Less: Severance expense (pre-tax) |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
4,838 |
|
Less: Merger-related expenses (pre-tax) |
106 |
|
|
366 |
|
|
1,434 |
|
|
1,774 |
|
|
1,469 |
|
Less: Amortization of tax credit investments (pre-tax) |
2,759 |
|
|
3,416 |
|
|
4,385 |
|
|
9,403 |
|
|
16,421 |
|
Non-interest expense, as adjusted |
$ |
154,967 |
|
|
$ |
153,384 |
|
|
$ |
140,058 |
|
|
$ |
459,477 |
|
|
$ |
412,681 |
|
Net interest income |
283,086 |
|
|
282,559 |
|
|
220,625 |
|
|
830,984 |
|
|
659,507 |
|
Non-interest income, as reported |
49,272 |
|
|
44,830 |
|
|
41,150 |
|
|
135,499 |
|
|
176,426 |
|
Add: Net impairment losses on securities (pre-tax) |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2,928 |
|
Add: Losses on securities transactions, net (pre-tax) |
46 |
|
|
41 |
|
|
93 |
|
|
127 |
|
|
114 |
|
Less: Gain on sale leaseback transaction (pre-tax) |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
78,505 |
|
Non-interest income, as adjusted |
$ |
49,318 |
|
|
$ |
44,871 |
|
|
$ |
41,243 |
|
|
$ |
135,626 |
|
|
$ |
100,963 |
|
Gross operating income, as adjusted |
$ |
332,404 |
|
|
$ |
327,430 |
|
|
$ |
261,868 |
|
|
$ |
966,610 |
|
|
$ |
760,470 |
|
Efficiency ratio, as adjusted |
46.62 |
% |
|
46.84 |
% |
|
53.48 |
% |
|
47.53 |
% |
|
54.27 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VALLEY NATIONAL
BANCORPCONSOLIDATED FINANCIAL
HIGHLIGHTS
|
As of |
|
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
($ in thousands, except for share data) |
2020 |
|
2020 |
|
2020 |
|
2019 |
|
2019 |
Tangible book value per common share: |
|
|
|
|
|
|
|
|
|
Common shares outstanding |
403,878,744 |
|
|
403,795,699 |
|
|
403,744,148 |
|
|
403,278,390 |
|
|
331,805,564 |
|
Shareholders' equity |
$ |
4,533,763 |
|
|
$ |
4,474,488 |
|
|
$ |
4,420,998 |
|
|
$ |
4,384,188 |
|
|
$ |
3,558,075 |
|
Less: Preferred stock |
209,691 |
|
|
209,691 |
|
|
209,691 |
|
|
209,691 |
|
|
209,691 |
|
Less: Goodwill and other intangible assets |
1,449,282 |
|
|
1,453,330 |
|
|
1,458,095 |
|
|
1,460,397 |
|
|
1,152,815 |
|
Tangible common shareholders' equity |
$ |
2,874,790 |
|
|
$ |
2,811,467 |
|
|
$ |
2,753,212 |
|
|
$ |
2,714,100 |
|
|
$ |
2,195,569 |
|
Tangible book value per common share |
$ |
7.12 |
|
|
$ |
6.96 |
|
|
$ |
6.82 |
|
|
$ |
6.73 |
|
|
$ |
6.62 |
|
Tangible common equity to tangible assets: |
|
|
|
|
|
|
|
|
Tangible common shareholders' equity |
$ |
2,874,790 |
|
|
$ |
2,811,467 |
|
|
$ |
2,753,212 |
|
|
$ |
2,714,100 |
|
|
$ |
2,195,569 |
|
Total assets |
40,855,333 |
|
|
41,717,265 |
|
|
39,120,629 |
|
|
37,436,020 |
|
|
33,765,539 |
|
Less: Goodwill and other intangible assets |
1,449,282 |
|
|
1,453,330 |
|
|
1,458,095 |
|
|
1,460,397 |
|
|
1,152,815 |
|
Tangible assets |
$ |
39,406,051 |
|
|
$ |
40,263,935 |
|
|
$ |
37,662,534 |
|
|
$ |
35,975,623 |
|
|
$ |
32,612,724 |
|
Tangible common equity to tangible assets |
7.30 |
% |
|
6.98 |
% |
|
7.31 |
% |
|
7.54 |
% |
|
6.73 |
% |
(3 |
) |
The efficiency ratio measures Valley's total non-interest expense
as a percentage of net interest income plus total non-interest
income. |
(4 |
) |
The adjustment represents an increase in the allowance for credit
losses for loans as a result of the adoption of ASU 2016-13
effective January 1, 2020. |
(5 |
) |
Charge-offs and recoveries presented for periods prior to March 31,
2020 exclude loans formerly known as Purchased Credit-Impaired
(PCI) loans. |
(6 |
) |
Periods prior to March 31, 2020 represent allowance and provision
for letters of credit only. |
(7 |
) |
Past due loans and non-accrual loans presented in periods prior to
March 31, 2020 exclude PCI loans. PCI loans were accounted for on a
pool basis and are were not subject to delinquency
classification. |
|
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@valley.com. |
|
VALLEY NATIONAL BANCORPCONSOLIDATED
STATEMENTS OF FINANCIAL CONDITION(in thousands,
except for share data)
|
September 30, |
|
December 31, |
|
2020 |
|
2019 |
|
(Unaudited) |
|
|
Assets |
|
|
|
Cash and due from banks |
$ |
383,961 |
|
|
$ |
256,264 |
|
Interest bearing deposits with
banks |
654,591 |
|
|
178,423 |
|
Investment securities: |
|
|
|
Equity securities |
29,026 |
|
|
41,410 |
|
Available for sale debt securities |
1,526,564 |
|
|
1,566,801 |
|
Held to maturity debt securities (net of allowance for credit
losses of $1,481 at September 30, 2020) |
2,168,995 |
|
|
2,336,095 |
|
Total investment securities |
3,724,585 |
|
|
3,944,306 |
|
Loans held for sale, at fair value |
209,250 |
|
|
76,113 |
|
Loans |
32,415,586 |
|
|
29,699,208 |
|
Less: Allowance for loan losses |
(325,032 |
) |
|
(161,759 |
) |
Net loans |
32,090,554 |
|
|
29,537,449 |
|
Premises and equipment,
net |
323,056 |
|
|
334,533 |
|
Lease right of use assets |
265,599 |
|
|
285,129 |
|
Bank owned life insurance |
533,768 |
|
|
540,169 |
|
Accrued interest receivable |
136,058 |
|
|
105,637 |
|
Goodwill |
1,375,409 |
|
|
1,373,625 |
|
Other intangible assets, net |
73,873 |
|
|
86,772 |
|
Other assets |
1,084,629 |
|
|
717,600 |
|
Total Assets |
$ |
40,855,333 |
|
|
$ |
37,436,020 |
|
Liabilities |
|
|
|
Deposits: |
|
|
|
Non-interest bearing |
$ |
8,756,924 |
|
|
$ |
6,710,408 |
|
Interest bearing: |
|
|
|
Savings, NOW and money market |
15,001,318 |
|
|
12,757,484 |
|
Time |
7,537,581 |
|
|
9,717,945 |
|
Total deposits |
31,295,823 |
|
|
29,185,837 |
|
Short-term borrowings |
1,430,726 |
|
|
1,093,280 |
|
Long-term borrowings |
2,852,569 |
|
|
2,122,426 |
|
Junior subordinated debentures
issued to capital trusts |
55,978 |
|
|
55,718 |
|
Lease liabilities |
290,441 |
|
|
309,849 |
|
Accrued expenses and other
liabilities |
396,033 |
|
|
284,722 |
|
Total Liabilities |
36,321,570 |
|
|
33,051,832 |
|
Shareholders’
Equity |
|
|
|
Preferred stock, no par value; 50,000,000 authorized shares: |
|
|
|
Series A (4,600,000 shares issued at September 30, 2020 and
December 31, 2019) |
111,590 |
|
|
111,590 |
|
Series B (4,000,000 shares issued at September 30, 2020 and
December 31, 2019) |
98,101 |
|
|
98,101 |
|
Common stock (no par value, authorized 650,000,000 shares; issued
403,880,132 shares at September 30, 2020 and 403,322,773 shares at
December 31, 2019) |
141,718 |
|
|
141,423 |
|
Surplus |
3,633,321 |
|
|
3,622,208 |
|
Retained earnings |
553,826 |
|
|
443,559 |
|
Accumulated other comprehensive
loss |
(4,783 |
) |
|
(32,214 |
) |
Treasury stock, at cost (1,388 common shares at September 30, 2020
and 44,383 common shares at December 31, 2019) |
(10 |
) |
|
(479 |
) |
Total Shareholders’ Equity |
4,533,763 |
|
|
4,384,188 |
|
Total Liabilities and Shareholders’ Equity |
$ |
40,855,333 |
|
|
$ |
37,436,020 |
|
|
|
|
|
|
|
|
|
VALLEY NATIONAL BANCORPCONSOLIDATED
STATEMENTS OF INCOME (Unaudited)(in thousands,
except for share data)
|
Three Months Ended |
|
Nine Months Ended |
|
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
|
2020 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Interest
Income |
|
|
|
|
|
|
|
|
|
Interest and fees on loans |
$ |
315,788 |
|
|
$ |
321,883 |
|
|
$ |
298,384 |
|
|
$ |
970,739 |
|
|
$ |
883,595 |
|
Interest and dividends on
investment securities: |
|
|
|
|
|
|
|
|
|
Taxable |
14,845 |
|
|
19,447 |
|
|
21,801 |
|
|
56,225 |
|
|
67,166 |
|
Tax-exempt |
3,606 |
|
|
3,692 |
|
|
4,219 |
|
|
11,224 |
|
|
13,379 |
|
Dividends |
2,684 |
|
|
3,092 |
|
|
3,171 |
|
|
9,177 |
|
|
9,140 |
|
Interest on federal funds sold and other short-term
investments |
420 |
|
|
411 |
|
|
1,686 |
|
|
2,296 |
|
|
3,947 |
|
Total interest income |
337,343 |
|
|
348,525 |
|
|
329,261 |
|
|
1,049,661 |
|
|
977,227 |
|
Interest
Expense |
|
|
|
|
|
|
|
|
|
Interest on deposits: |
|
|
|
|
|
|
|
|
|
Savings, NOW and money market |
13,323 |
|
|
16,627 |
|
|
35,944 |
|
|
64,463 |
|
|
110,247 |
|
Time |
19,028 |
|
|
29,857 |
|
|
42,848 |
|
|
91,699 |
|
|
121,350 |
|
Interest on short-term
borrowings |
2,588 |
|
|
1,980 |
|
|
12,953 |
|
|
9,275 |
|
|
40,362 |
|
Interest on long-term borrowings and junior subordinated
debentures |
19,318 |
|
|
17,502 |
|
|
16,891 |
|
|
53,240 |
|
|
45,761 |
|
Total interest expense |
54,257 |
|
|
65,966 |
|
|
108,636 |
|
|
218,677 |
|
|
317,720 |
|
Net Interest
Income |
283,086 |
|
|
282,559 |
|
|
220,625 |
|
|
830,984 |
|
|
659,507 |
|
Provision for credit losses for
held to maturity securities |
(112 |
) |
|
41 |
|
|
— |
|
|
688 |
|
|
— |
|
Provision for credit losses for
loans |
31,020 |
|
|
41,115 |
|
|
8,700 |
|
|
106,059 |
|
|
18,800 |
|
Net Interest Income After Provision for Credit
Losses |
252,178 |
|
|
241,403 |
|
|
211,925 |
|
|
724,237 |
|
|
640,707 |
|
Non-Interest
Income |
|
|
|
|
|
|
|
|
|
Trust and investment
services |
3,068 |
|
|
2,826 |
|
|
3,296 |
|
|
9,307 |
|
|
9,296 |
|
Insurance commissions |
1,816 |
|
|
1,659 |
|
|
2,748 |
|
|
5,426 |
|
|
7,922 |
|
Service charges on deposit
accounts |
3,952 |
|
|
3,557 |
|
|
5,904 |
|
|
13,189 |
|
|
17,634 |
|
Losses on securities
transactions, net |
(46 |
) |
|
(41 |
) |
|
(93 |
) |
|
(127 |
) |
|
(114 |
) |
Other-than-temporary impairment
losses on securities |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(2,928 |
) |
Fees from loan servicing |
2,551 |
|
|
2,227 |
|
|
2,463 |
|
|
7,526 |
|
|
7,260 |
|
Gains on sales of loans, net |
13,366 |
|
|
8,337 |
|
|
5,194 |
|
|
26,253 |
|
|
13,700 |
|
Gains (losses) on sales of
assets, net |
894 |
|
|
(299 |
) |
|
(159 |
) |
|
716 |
|
|
76,997 |
|
Bank owned life insurance |
(1,304 |
) |
|
5,823 |
|
|
2,687 |
|
|
7,661 |
|
|
6,779 |
|
Other |
24,975 |
|
|
20,741 |
|
|
19,110 |
|
|
65,548 |
|
|
39,880 |
|
Total non-interest income |
49,272 |
|
|
44,830 |
|
|
41,150 |
|
|
135,499 |
|
|
176,426 |
|
Non-Interest
Expense |
|
|
|
|
|
|
|
|
|
Salary and employee benefits
expense |
83,626 |
|
|
78,532 |
|
|
77,271 |
|
|
247,886 |
|
|
236,559 |
|
Net occupancy and equipment
expense |
31,116 |
|
|
33,217 |
|
|
29,203 |
|
|
96,774 |
|
|
86,789 |
|
FDIC insurance assessment |
4,847 |
|
|
6,135 |
|
|
5,098 |
|
|
14,858 |
|
|
16,150 |
|
Amortization of other intangible
assets |
6,377 |
|
|
6,681 |
|
|
4,694 |
|
|
18,528 |
|
|
13,175 |
|
Professional and legal fees |
8,762 |
|
|
7,797 |
|
|
5,870 |
|
|
22,646 |
|
|
15,286 |
|
Loss on extinguishment of
debt |
2,353 |
|
|
— |
|
|
— |
|
|
2,353 |
|
|
— |
|
Amortization of tax credit
investments |
2,759 |
|
|
3,416 |
|
|
4,385 |
|
|
9,403 |
|
|
16,421 |
|
Telecommunication expense |
2,094 |
|
|
2,866 |
|
|
2,698 |
|
|
7,247 |
|
|
7,317 |
|
Other |
18,251 |
|
|
18,522 |
|
|
16,658 |
|
|
53,312 |
|
|
43,712 |
|
Total non-interest expense |
160,185 |
|
|
157,166 |
|
|
145,877 |
|
|
473,007 |
|
|
435,409 |
|
Income Before Income
Taxes |
141,265 |
|
|
129,067 |
|
|
107,198 |
|
|
386,729 |
|
|
381,724 |
|
Income tax expense |
38,891 |
|
|
33,466 |
|
|
25,307 |
|
|
101,486 |
|
|
110,035 |
|
Net Income |
102,374 |
|
|
95,601 |
|
|
81,891 |
|
|
285,243 |
|
|
271,689 |
|
Dividends on preferred stock |
3,172 |
|
|
3,172 |
|
|
3,172 |
|
|
9,516 |
|
|
9,516 |
|
Net Income Available to
Common Shareholders |
$ |
99,202 |
|
|
$ |
92,429 |
|
|
$ |
78,719 |
|
|
$ |
275,727 |
|
|
$ |
262,173 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VALLEY NATIONAL BANCORPCONSOLIDATED
STATEMENTS OF INCOME (Unaudited)(in thousands,
except for share data)
|
Three Months Ended |
|
Nine Months Ended |
|
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
|
2020 |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Earnings Per Common
Share: |
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.25 |
|
|
$ |
0.23 |
|
|
$ |
0.24 |
|
|
$ |
0.68 |
|
|
$ |
0.79 |
|
Diluted |
0.25 |
|
|
0.23 |
|
|
0.24 |
|
|
0.68 |
|
|
0.79 |
|
Cash Dividends Declared
per Common Share |
0.11 |
|
|
0.11 |
|
|
0.11 |
|
|
0.33 |
|
|
0.33 |
|
Weighted Average Number of Common Shares
Outstanding: |
|
|
|
|
|
|
|
|
|
Basic |
403,833,469 |
|
|
403,790,242 |
|
|
331,797,982 |
|
|
403,714,701 |
|
|
331,716,652 |
|
Diluted |
404,788,526 |
|
|
404,631,845 |
|
|
333,405,196 |
|
|
404,912,126 |
|
|
333,039,436 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VALLEY NATIONAL BANCORP |
Quarterly Analysis of Average Assets, Liabilities and
Shareholders' Equity and |
Net Interest Income on a Tax Equivalent Basis |
|
|
Three Months Ended |
|
September 30, 2020 |
|
June 30, 2020 |
|
September 30, 2019 |
|
Average |
|
|
|
Avg. |
|
Average |
|
|
|
Avg. |
|
Average |
|
|
|
Avg. |
($ in thousands) |
Balance |
|
Interest |
|
Rate |
|
Balance |
|
Interest |
|
Rate |
|
Balance |
|
Interest |
|
Rate |
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans (1)(2) |
$ |
32,515,264 |
|
|
$ |
315,863 |
|
|
3.89 |
% |
|
$ |
32,041,200 |
|
|
$ |
321,883 |
|
|
4.02 |
% |
|
$ |
26,136,745 |
|
|
$ |
298,384 |
|
|
4.57 |
% |
Taxable investments (3) |
3,354,373 |
|
|
17,529 |
|
|
2.09 |
|
|
3,673,090 |
|
|
22,539 |
|
|
2.45 |
|
|
3,411,330 |
|
|
24,972 |
|
|
2.93 |
|
Tax-exempt investments (1)(3) |
542,450 |
|
|
4,564 |
|
|
3.37 |
|
|
562,172 |
|
|
4,673 |
|
|
3.32 |
|
|
632,709 |
|
|
5,341 |
|
|
3.38 |
|
Interest bearing deposits with banks |
1,355,623 |
|
|
420 |
|
|
0.12 |
|
|
1,501,925 |
|
|
411 |
|
|
0.11 |
|
|
313,785 |
|
|
1,686 |
|
|
2.15 |
|
Total interest earning
assets |
37,767,710 |
|
|
338,376 |
|
|
3.58 |
|
|
37,778,387 |
|
|
349,506 |
|
|
3.70 |
|
|
30,494,569 |
|
|
330,383 |
|
|
4.33 |
|
Other assets |
3,689,805 |
|
|
|
|
|
|
3,725,127 |
|
|
|
|
|
|
2,924,568 |
|
|
|
|
|
Total assets |
$ |
41,457,515 |
|
|
|
|
|
|
$ |
41,503,514 |
|
|
|
|
|
|
$ |
33,419,137 |
|
|
|
|
|
Liabilities and
shareholders' equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings, NOW and money market deposits |
$ |
14,643,248 |
|
|
$ |
13,323 |
|
|
0.36 |
% |
|
$ |
13,788,951 |
|
|
$ |
16,627 |
|
|
0.48 |
% |
|
$ |
11,065,959 |
|
|
$ |
35,944 |
|
|
1.30 |
% |
Time deposits |
8,027,346 |
|
|
19,028 |
|
|
0.95 |
|
|
8,585,782 |
|
|
29,857 |
|
|
1.39 |
|
|
7,383,202 |
|
|
42,848 |
|
|
2.32 |
|
Short-term borrowings |
1,533,246 |
|
|
2,588 |
|
|
0.68 |
|
|
2,317,992 |
|
|
1,980 |
|
|
0.34 |
|
|
2,265,528 |
|
|
12,953 |
|
|
2.29 |
|
Long-term borrowings (4) |
2,959,728 |
|
|
19,318 |
|
|
2.61 |
|
|
2,886,016 |
|
|
17,502 |
|
|
2.43 |
|
|
2,143,432 |
|
|
16,891 |
|
|
3.15 |
|
Total interest bearing
liabilities |
27,163,568 |
|
|
54,257 |
|
|
0.80 |
|
|
27,578,741 |
|
|
65,966 |
|
|
0.96 |
|
|
22,858,121 |
|
|
108,636 |
|
|
1.90 |
|
Non-interest bearing
deposits |
8,820,877 |
|
|
|
|
|
|
8,463,230 |
|
|
|
|
|
|
6,387,188 |
|
|
|
|
|
Other liabilities |
942,399 |
|
|
|
|
|
|
984,097 |
|
|
|
|
|
|
637,300 |
|
|
|
|
|
Shareholders' equity |
4,530,671 |
|
|
|
|
|
|
4,477,446 |
|
|
|
|
|
|
3,536,528 |
|
|
|
|
|
Total liabilities and
shareholders' equity |
$ |
41,457,515 |
|
|
|
|
|
|
$ |
41,503,514 |
|
|
|
|
|
|
$ |
33,419,137 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income/interest
rate spread (5) |
|
|
$ |
284,119 |
|
|
2.78 |
% |
|
|
|
$ |
283,540 |
|
|
2.74 |
% |
|
|
|
$ |
221,747 |
|
|
2.43 |
% |
Tax equivalent adjustment |
|
|
(1,033 |
) |
|
|
|
|
|
(981 |
) |
|
|
|
|
|
(1,122 |
) |
|
|
Net interest income, as
reported |
|
|
$ |
283,086 |
|
|
|
|
|
|
$ |
282,559 |
|
|
|
|
|
|
$ |
220,625 |
|
|
|
Net interest margin (6) |
|
|
|
|
3.00 |
|
|
|
|
|
|
2.99 |
|
|
|
|
|
|
2.89 |
|
Tax equivalent effect |
|
|
|
|
0.01 |
|
|
|
|
|
|
0.01 |
|
|
|
|
|
|
0.02 |
|
Net interest margin on a fully
tax equivalent basis (6) |
|
|
|
|
3.01 |
% |
|
|
|
|
|
3.00 |
% |
|
|
|
|
|
2.91 |
% |
____________ |
(1) |
Interest income is presented on a tax equivalent basis using a 21
percent federal tax rate. |
(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. |
Contact: |
Michael D. Hagedorn |
|
Senior Executive Vice President and |
|
Chief Financial Officer |
|
973-872-4885 |
Valley National Bancorp (NASDAQ:VLY)
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From Jun 2024 to Jul 2024
Valley National Bancorp (NASDAQ:VLY)
Historical Stock Chart
From Jul 2023 to Jul 2024