Valley National Bancorp (
NASDAQ:VLY), the holding
company for Valley National Bank, today reported net income for the
third quarter 2024 of $97.9 million, or $0.18 per diluted common
share, as compared to the second quarter 2024 net income of $70.4
million, or $0.13 per diluted common share, and net income of
$141.3 million, or $0.27 per diluted common share, for the third
quarter 2023. Excluding all non-core income and charges, our
adjusted net income (a non-GAAP measure) was $96.8 million, or
$0.18 per diluted common share, for the third quarter 2024, $71.6
million, or $0.13 per diluted common share, for the second quarter
2024, and $136.4 million, or $0.26 per diluted common share, for
the third quarter 2023. See further details below, including a
reconciliation of our non-GAAP adjusted net income, in the
"Consolidated Financial Highlights" tables.
Ira Robbins, CEO, commented, "The third
quarter’s financial results highlight the significant progress that
we continue to make towards achieving our strategic balance sheet
goals. On October 23, 2024, we entered into an agreement to sell
performing commercial real estate loans expected to total over $800
million at a very modest discount of approximately 1 percent to a
single investor. This economically compelling transaction is
expected to close in the fourth quarter 2024 and reflects the
strength and desirability of our commercial real estate portfolio.
We have executed on a variety of strategic transactions this year
that have notably strengthened our balance sheet and enhanced our
financial flexibility.”
Mr. Robbins continued, "This quarter’s results
also indicated the early stages of normalized profitability which
we expect will accelerate as we enter 2025. Net interest income and
non-interest income both improved meaningfully from the second
quarter 2024, and our operating expenses were well-controlled and
effectively unchanged on a year-over-year basis. While recent
weather events weighed on the sequential provision improvement that
we anticipated, our pre-provision earnings continued to improve
during the third quarter and could set the stage for more stable
results in the near future. And most importantly, our thoughts are
with those affected by the recent hurricanes in our Florida markets
and the other areas in the southeast. We are strongly committed to
supporting our associates, clients and communities throughout the
rebuilding and recovery process.”
Key financial highlights for
the third quarter
2024:
- Net
Interest Income and Margin: Net interest income on a tax
equivalent basis of $411.8 million for the third quarter 2024
increased $8.8 million compared to the second quarter 2024 and
decreased $1.8 million as compared to the third quarter 2023. Our
net interest margin on a tax equivalent basis also increased by 2
basis points to 2.86 percent in the third quarter 2024 as compared
to 2.84 percent for the second quarter 2024. The increases from the
second quarter 2024 were mostly due to continued yield expansion on
average loans and additional interest income and higher yields from
targeted growth within our available for sale securities portfolio.
See the "Net Interest Income and Margin" section below for more
details.
- Loan
Portfolio: Total loans decreased $956.4 million, or 7.6
percent on an annualized basis, to $49.4 billion at
September 30, 2024 from June 30, 2024 mostly due to the
transfer of performing commercial real estate loans totaling $823.1
million, net of unearned fees, to loans held for sale at
September 30, 2024 and normal repayment activity mainly within
the commercial real estate non-owner occupied and multi-family
loans, as we continue to actively reduce these loan categories. Our
commercial and industrial loans grew $320.1 million, or 13.5
percent on an annualized basis, to $9.8 billion at
September 30, 2024 from June 30, 2024 due to solid
organic growth during the third quarter 2024. Residential mortgage
and total consumer loans also increased modestly during the third
quarter 2024. See the "Loans" section below for more details.
-
Deposits: Actual ending balances for deposits
increased $283.8 million to $50.4 billion at September 30,
2024 as compared to $50.1 billion at June 30, 2024 mainly due
to higher period-end direct commercial customer money market and
non-interest bearing deposits, partially offset by a decline in
time deposits. See the "Deposits" section below for more
details.
-
Allowance and Provision for Credit Losses for
Loans: The allowance for credit losses for loans totaled
$564.7 million and $532.5 million at September 30, 2024 and
June 30, 2024, respectively, representing 1.14 percent and
1.06 percent of total loans at each respective date. During the
third quarter 2024, we recorded a provision for credit losses for
loans of $75.0 million as compared to $82.1 million and $9.1
million for the second quarter 2024 and third quarter 2023,
respectively. The third quarter 2024 provision reflects, among
other factors, increased quantitative reserves allocated to
commercial real estate loans, significant commercial and industrial
loan growth and $8.0 million of qualitative reserves related to the
estimated impact of Hurricane Helene, which hit Florida in late
September 2024.
- Credit
Quality: Non-accrual loans totaled $296.3 million, or 0.60
percent of total loans at September 30, 2024 as compared to
$303.3 million, or 0.60 percent of total loans at June 30,
2024. Total accruing past due loans (i.e., loans past due 30 days
or more and still accruing interest) increased to 0.35 percent of
total loans at September 30, 2024 as compared to 0.14 percent
at June 30, 2024 largely due to two well-secured commercial
real estate loans at various stages of expected collection within
the early stage delinquency categories. Net loan charge-offs
totaled $42.9 million for the third quarter 2024 as compared to
$36.8 million and $5.5 million for the second quarter 2024 and
third quarter 2023, respectively. The loan charge-offs in the third
quarter 2024 included partial charge-offs totaling a combined $30.1
million related to two commercial real estate loan relationships.
See the "Credit Quality" section below for more details.
-
Non-Interest Income: Non-interest income increased
$9.5 million to $60.7 million for the third quarter 2024 as
compared to the second quarter 2024 mainly due to increases in
other income; wealth management and trust fees; and service charges
on deposits totaling $11.2 million, $2.0 million, and $1.6 million,
respectively. The increases in the aforementioned categories were
partially offset by a $5.8 million mark to market loss (recorded
within net losses on sales of loans) associated with the performing
commercial real estate loans transferred to loans held for sale at
September 30, 2024, as well as lower swap fees related to
commercial loan transactions (within capital market fees) and
insurance commissions. The increase in other income was mostly the
result of income from litigation settlements totaling $7.3 million
for the third quarter 2024.
-
Non-Interest Expense: Non-interest expense
decreased $8.0 million to $269.5 million for the third quarter 2024
as compared to the second quarter 2024 largely due to a $6.2
million decrease in technology, furniture and equipment expense and
a $3.8 million decrease in professional and legal expenses,
partially offset by higher net occupancy expense during the third
quarter 2024.
-
Efficiency Ratio: Our efficiency ratio was 56.13
percent for the third quarter 2024 as compared to 59.62 percent and
56.72 percent for the second quarter 2024 and third quarter 2023,
respectively. See the "Consolidated Financial Highlights" tables
below for additional information regarding our non-GAAP
measures.
- Performance
Ratios: Annualized return on average assets (ROA),
shareholders’ equity (ROE) and tangible ROE were 0.63 percent, 5.70
percent and 8.06 percent for the third quarter 2024, respectively.
Annualized ROA, ROE, and tangible ROE, adjusted for non-core income
and charges, were 0.62 percent, 5.64 percent and 7.97 percent for
the third quarter 2024, respectively. See the "Consolidated
Financial Highlights" tables below for additional information
regarding our non-GAAP measures.
Net Interest Income and Margin
Net interest income on a tax equivalent basis of
$411.8 million for the third quarter 2024 increased $8.8 million
compared to the second quarter 2024 and decreased $1.8 million as
compared to the third quarter 2023. Interest income on a tax
equivalent basis increased $27.1 million to $861.9 million for the
third quarter 2024 as compared to the second quarter 2024. The
increase was mostly due to higher yields on both new loan
originations and adjustable rate loans, as well as higher yields
and additional interest income from targeted purchases of taxable
investments within the available for sale securities portfolio
during the second and third quarter 2024. Total interest expense
increased $18.3 million to $450.1 million for the third quarter
2024 as compared to the second quarter 2024 mainly due to an
increase in average time deposit balances coupled with higher costs
on most interest bearing deposit products. See the "Deposits" and
"Other Borrowings" sections below for more details.
Net interest margin on a tax equivalent basis of
2.86 percent for the third quarter 2024 increased by 2 basis points
from 2.84 percent for the second quarter 2024 and decreased 5 basis
points from 2.91 percent for the third quarter 2023. The increase
as compared to the second quarter 2024 was largely driven by the
higher yield on average interest earning assets largely offset by
an increase in the cost of average interest bearing liabilities.
The yield on average interest earning assets increased by 10 basis
points to 5.98 percent on a linked quarter basis largely due to
higher yielding investment purchases and new loan originations
during the second and third quarter 2024. The overall cost of
average interest bearing liabilities increased 7 basis points to
4.22 percent for the third quarter 2024 as compared to the second
quarter 2024 largely due to higher interest rates on deposits. Our
cost of total average deposits was 3.25 percent for the third
quarter 2024 as compared to 3.18 percent and 2.94 percent for the
second quarter 2024 and the third quarter 2023, respectively.
Loans, Deposits and Other Borrowings
Loans. Total loans decreased
$956.4 million, or 7.6 percent on an annualized basis, to
$49.4 billion at September 30, 2024 from June 30, 2024.
Commercial and industrial loans grew by $320.1 million , or 13.5
percent on an annualized basis, to $9.8 billion at
September 30, 2024 from June 30, 2024 largely due to our
continued strategic focus on the expansion of new loan production
within this category. Total commercial real estate (including
construction) loans decreased $1.4 billion to $30.4 billion at
September 30, 2024 from June 30, 2024. This decline was
primarily driven by the transfer of $823.1 million of commercial
real estate loans, net of unearned loan fees, from the loans held
for investment portfolio to loans held for sale as of
September 30, 2024. In addition, we remained highly selective
on new originations and projects in an effort to reduce commercial
real estate loan concentrations, mainly within the non-owner
occupied and multifamily loan categories. Automobile loan balances
increased by $60.9 million, or 13.8 percent on an annualized basis,
to $1.8 billion at September 30, 2024 from June 30, 2024
mainly due to continued consumer demand generated by our indirect
auto dealer network and low prepayment activity within the
portfolio. Other consumer loans decreased $42.4 million, or 15.3
percent on an annualized basis, to $1.1 billion at
September 30, 2024 from June 30, 2024 primarily due to
the negative impact of the high level of market interest rates on
the demand and usage of collateralized personal lines of
credit.
Deposits. Actual ending
balances for deposits increased $283.8 million to $50.4 billion at
September 30, 2024 from June 30, 2024 mainly due to an
increase of $358.3 million in savings, NOW and money market
deposits and an increase of $36.0 million in non-interest bearing
deposits, partially offset by a decrease of $110.5 million in time
deposits. Non-interest bearing deposit and savings, NOW and money
market deposit balances increased at September 30, 2024 from
June 30, 2024 mostly due to increases in national specialized
deposits and higher direct commercial customer deposit accounts.
Total indirect customer deposits (including both brokered money
market and time deposits) totaled $9.1 billion in both
September 30, 2024 and June 30, 2024. Non-interest
bearing deposits; savings, NOW and money market deposits; and time
deposits represented approximately 22 percent, 50 percent and 28
percent of total deposits as of September 30, 2024,
respectively, as compared to 22 percent, 49 percent and 29 percent
of total deposits as of June 30, 2024, respectively.
Other
Borrowings. Short-term borrowings,
consisting of securities sold under agreements to repurchase,
decreased $5.5 million to $58.3 million at September 30, 2024
from June 30, 2024. Long-term borrowings totaled $3.3 billion
at September 30, 2024 and also remained relatively unchanged
as compared to June 30, 2024.
Credit Quality
Hurricanes Helene and Milton.
In the early stages of the fourth quarter 2024, the credit quality
of our Florida loan portfolio has remained resilient in the
aftermath of Hurricane Helene, which hit Florida in late September
2024, and Hurricane Milton, which made landfall on October 9, 2024.
At this time, there have been relatively few loan concessions
(mostly in the form of loan payment deferrals up to 90 days) for
distressed borrowers impacted by the hurricanes. However, we
continue to assess the impact of the hurricanes on our Florida
client base and, where appropriate, we will work constructively
with individual borrowers.
Non-Performing Assets (NPAs).
Total NPAs, consisting of non-accrual loans, other real estate
owned (OREO) and other repossessed assets, decreased $7.8 million
to $305.1 million at September 30, 2024 as compared to
June 30, 2024. Non-accrual loans decreased $7.0 million to
$296.3 million at September 30, 2024 as compared to $303.3
million at June 30, 2024. Non-accrual construction and
commercial real estate loans decreased $20.7 million and $9.3
million to $24.7 million and $113.8 million, respectively, at
September 30, 2024 as compared to June 30, 2024 mainly
due to loan payoffs during the third quarter 2024. The decreases in
these loan categories were partially offset by two new non-accrual
commercial and industrial loans totaling $19.0 million, as well as
moderate increases in non-accrual residential mortgage and consumer
loans at September 30, 2024. OREO decreased $887 thousand at
September 30, 2024 from June 30, 2024 mostly due to the
sale of one commercial property, which resulted in the recognition
of an immaterial loss for the third quarter 2024.
Accruing Past Due Loans. Total
accruing past due loans (i.e., loans past due 30 days or more and
still accruing interest) increased $102.3 million to $174.7
million, or 0.35 percent of total loans, at September 30, 2024
as compared to $72.4 million, or 0.14 percent of total loans at
June 30, 2024. Loans 30 to 59 days past due increased $69.1
million to $115.1 million at September 30, 2024 as compared to
June 30, 2024 mainly due to a $74.5 million increase in
commercial real estate loans, partially offset by a $7.0 million
decline in consumer loan delinquencies. The increase in commercial
real estate loans 30 to 59 days past due was mostly due to one new
delinquent loan totaling $40.9 million, which is expected to be
fully repaid, subject to the borrower's pending sale of certain
collateral, as well as a few other new loan delinquencies. Loans 60
to 89 days past due increased $42.9 million to $54.8 million at
September 30, 2024 as compared to June 30, 2024 mostly
due to one well-secured commercial real estate loan totaling $43.9
million currently in the process of loan modification. Loans 90
days or more past due and still accruing interest decreased $9.7
million to $4.8 million at September 30, 2024 as compared to
June 30, 2024 largely due to one $4.0 million construction
loan that was fully repaid and one $4.2 million commercial real
estate loan that migrated from this past due category to
non-accrual loans during the third quarter 2024. All loans 90 days
or more past due and still accruing interest are well-secured and
in the process of collection.
Allowance for Credit Losses for Loans
and Unfunded Commitments. The following table summarizes
the allocation of the allowance for credit losses to loan
categories and the allocation as a percentage of each loan category
at September 30, 2024, June 30, 2024 and
September 30, 2023:
| |
|
September 30, 2024 |
|
June 30, 2024 |
|
September 30, 2023 |
| |
|
|
|
Allocation |
|
|
|
Allocation |
|
|
|
Allocation |
| |
|
|
|
as a % of |
|
|
|
as a % of |
|
|
|
as a % of |
| |
|
Allowance |
|
Loan |
|
Allowance |
|
Loan |
|
Allowance |
|
Loan |
| |
Allocation |
|
Category |
|
Allocation |
|
Category |
|
Allocation |
|
Category |
| |
($ in thousands) |
| Loan
Category: |
|
|
|
|
|
|
|
|
|
|
|
| Commercial and
industrial loans |
$ |
166,365 |
|
1.70 |
% |
|
$ |
149,243 |
|
1.57 |
% |
|
$ |
133,988 |
|
1.44 |
% |
| Commercial real
estate loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial real estate |
|
249,608 |
|
0.93 |
|
|
|
246,316 |
|
0.87 |
|
|
|
191,562 |
|
0.68 |
|
| |
Construction |
|
59,420 |
|
1.70 |
|
|
|
54,777 |
|
1.54 |
|
|
|
53,485 |
|
1.40 |
|
| Total commercial
real estate loans |
|
309,028 |
|
1.02 |
|
|
|
301,093 |
|
0.95 |
|
|
|
245,047 |
|
0.77 |
|
| Residential
mortgage loans |
|
51,545 |
|
0.91 |
|
|
|
47,697 |
|
0.85 |
|
|
|
44,621 |
|
0.80 |
|
| Consumer
loans: |
|
|
|
|
|
|
|
|
|
|
|
| |
Home equity |
|
3,303 |
|
0.57 |
|
|
|
3,077 |
|
0.54 |
|
|
|
3,689 |
|
0.67 |
|
| |
Auto and other consumer |
|
18,086 |
|
0.63 |
|
|
|
18,200 |
|
0.63 |
|
|
|
14,830 |
|
0.52 |
|
| Total consumer
loans |
|
21,389 |
|
0.62 |
|
|
|
21,277 |
|
0.62 |
|
|
|
18,519 |
|
0.55 |
|
| Allowance for loan
losses |
|
548,327 |
|
1.11 |
|
|
|
519,310 |
|
1.03 |
|
|
|
442,175 |
|
0.88 |
|
| Allowance for
unfunded credit commitments |
|
16,344 |
|
|
|
|
13,231 |
|
|
|
|
20,170 |
|
|
| Total allowance
for credit losses for loans |
$ |
564,671 |
|
|
|
$ |
532,541 |
|
|
|
$ |
462,345 |
|
|
|
Allowance for credit losses for loans as a % total loans |
|
|
1.14 |
% |
|
|
|
1.06 |
% |
|
|
|
0.92 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Our loan portfolio, totaling $49.4 billion at
September 30, 2024, had net loan charge-offs totaling $42.9
million for the third quarter 2024 as compared to $36.8 million and
$5.5 million for the second quarter 2024 and the third quarter
2023, respectively. Total gross loan charge-offs in the third
quarter 2024 included partial charge-offs totaling $30.1 million
related to two non-performing commercial real estate loan
relationships that had combined specific reserves of $25.9 million
within the allowance for loan losses at June 30, 2024.
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 1.14 percent at
September 30, 2024, 1.06 percent at June 30, 2024, and
0.92 percent at September 30, 2023. For the third quarter
2024, the provision for credit losses for loans totaled $75.0
million as compared to $82.1 million and $9.1 million for the
second quarter 2024 and third quarter 2023, respectively. The
provision for credit losses remained somewhat elevated for the
third quarter 2024 largely due to higher quantitative reserves
allocated to commercial real estate loans, commercial and
industrial loan growth and $8.0 million of qualitative reserves
related to the estimated impact of Hurricane Helene.
The allowance for unfunded credit commitments
increased to $16.3 million at September 30, 2024 from $13.2
million at June 30, 2024 mainly due to increases in both
non-cancellable construction commitments and commercial and
industrial standby letters of credit.
As previously noted, we are currently evaluating
the impact of Hurricane Milton, and we also continue to evaluate
any further impact of Hurricane Helene, on our loan portfolio.
While not anticipated based on information currently available,
Hurricane Milton and unexpected losses from Hurricane Helene could
result in a significant increase to the current hurricane related
reserves within the allowance, loan charge-offs and our provision
for the fourth quarter 2024.
Capital Adequacy
Valley's total risk-based capital, common equity
Tier 1 capital, Tier 1 capital and Tier 1 leverage capital ratios
were 12.56 percent, 9.57 percent, 10.29 percent and 8.40 percent,
respectively, at September 30, 2024 as compared to 12.18
percent, 9.55 percent, 9.99 percent and 8.19 percent, respectively,
at June 30, 2024. The increases in the total risk-based
capital, Tier 1 capital and Tier 1 leverage ratios as compared to
June 30, 2024 were largely due to Valley's issuance of 6.0
million shares of its 8.250 percent Fixed-Rate Reset Non-Cumulative
Perpetual Preferred Stock, Series C on August 5, 2024. Net proceeds
to Valley after deducting underwriting discounts, commissions and
offering expenses were approximately $144.7 million.
Investor Conference Call
Valley will host a conference call with
investors and the financial community at 11:00 AM (ET) today to
discuss the third quarter 2024 earnings and related matters.
Interested parties should preregister using this link:
https://register.vevent.com/register to receive the dial-in number
and a personal PIN, which are required to access the conference
call. The teleconference will also be webcast live:
https://edge.media-server.com and archived on Valley’s website
through Monday, December 2, 2024. 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 over $62
billion in assets. Valley is committed to giving people and
businesses the power to succeed. Valley operates many convenient
branch locations and commercial banking offices across New Jersey,
New York, Florida, Alabama, California and Illinois, 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 Care 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 our business, 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 “intend,” “should,” “expect,” “believe,” “view,”
“opportunity,” “allow,” “continues,” “reflects,” “would,” “could,”
“typically,” “usually,” “anticipate,” “may,” “estimate,” “outlook,”
“project” 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
market interest rates and monetary and fiscal policies of the U.S.
federal government and its agencies in connection with the
prolonged inflationary pressures, which could have a material
adverse effect on our clients, our business, our employees, and our
ability to provide services to our customers;
- the impact of unfavorable
macroeconomic conditions or downturns, including an actual or
threatened U.S. government shutdown, debt default or rating
downgrade, instability or volatility in financial markets,
unanticipated loan delinquencies, loss of collateral, decreased
service revenues, increased business disruptions or failures,
reductions in employment, and other potential negative effects on
our business, employees or clients caused by factors outside of our
control, such as the outcome of the 2024 U.S. presidential
election, geopolitical instabilities or events (including the
Israel-Hamas war and the escalation and regional expansion
thereof); natural and other disasters (including severe weather
events, such as Hurricanes Helene and Milton); health emergencies;
acts of terrorism; or other external events;
- the impact of
potential instability within the U.S. financial sector in the
aftermath of the banking failures in 2023 and continued volatility
thereafter, including the possibility of a run on deposits by a
coordinated deposit base, and the impact of the actual or perceived
soundness, or concerns about the creditworthiness of other
financial institutions, including any resulting disruption within
the financial markets, increased expenses, including Federal
Deposit Insurance Corporation insurance assessments, or adverse
impact on our stock price, deposits or our ability to borrow or
raise capital;
- the impact of
negative public opinion regarding Valley or banks in general that
damages our reputation and adversely impacts business and
revenues;
- changes in the
statutes, regulations, policy, or enforcement priorities of the
federal bank regulatory agencies;
- the loss of or
decrease in lower-cost funding sources within our deposit
base;
- 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, trademark or other intellectual
property infringement, misappropriation or other violation,
employment related claims, and other matters;
- a prolonged
downturn and contraction in the economy, as well as an unexpected
decline in commercial real estate values collateralizing a
significant portion of our loan portfolio;
- 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;
- changes in our
business, strategy, market conditions or other factors that may
negatively impact the estimated fair value of our goodwill and
other intangible assets and result in future impairment
charges;
- 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;
- cyberattacks,
ransomware attacks, computer viruses, malware or other
cybersecurity incidents that may breach the security of our
websites or other systems or networks to obtain unauthorized access
to personal, confidential, proprietary or sensitive information,
destroy data, disable or degrade service, or sabotage our systems
or networks;
- results of
examinations by the Office of the Comptroller of the Currency
(OCC), the Federal Reserve Bank, the Consumer Financial Protection
Bureau (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;
- application of
the OCC heightened regulatory standards for certain large insured
national banks, and the expenses we will incur to develop policies,
programs, and systems that comply with the enhanced standards
applicable to us;
- 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, pandemics or other public health crises, acts of
terrorism or other external events;
- our ability to
successfully execute our business plan and strategic initiatives;
and
- unexpected significant declines in the loan portfolio due to
the lack of economic expansion, increased competition, large
prepayments, risk mitigation strategies, changes in regulatory
lending guidance or other factors.
A detailed discussion of factors that could
affect our results is included in our SEC filings, including Item
1A. "Risk Factors" of our Annual Report on Form 10-K for the year
ended December 31, 2023.
We undertake no duty to update any
forward-looking statement to conform the statement to actual
results or changes in our expectations, except as required by law.
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 and stock price) |
2024 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
| FINANCIAL
DATA: |
|
|
|
|
|
|
|
|
|
|
Net interest income - FTE(1) |
$ |
411,812 |
|
|
$ |
402,984 |
|
|
$ |
413,657 |
|
|
$ |
1,209,643 |
|
|
$ |
1,272,390 |
|
| Net interest income |
$ |
410,498 |
|
|
$ |
401,685 |
|
|
$ |
412,418 |
|
|
$ |
1,205,731 |
|
|
$ |
1,268,203 |
|
| Non-interest income |
|
60,671 |
|
|
|
51,213 |
|
|
|
58,664 |
|
|
|
173,299 |
|
|
|
173,038 |
|
| Total revenue |
|
471,169 |
|
|
|
452,898 |
|
|
|
471,082 |
|
|
|
1,379,030 |
|
|
|
1,441,241 |
|
| Non-interest expense |
|
269,471 |
|
|
|
277,497 |
|
|
|
267,133 |
|
|
|
827,278 |
|
|
|
822,270 |
|
| Pre-provision net revenue |
|
201,698 |
|
|
|
175,401 |
|
|
|
203,949 |
|
|
|
551,752 |
|
|
|
618,971 |
|
| Provision for credit
losses |
|
75,024 |
|
|
|
82,070 |
|
|
|
9,117 |
|
|
|
202,294 |
|
|
|
29,604 |
|
| Income tax expense |
|
28,818 |
|
|
|
22,907 |
|
|
|
53,486 |
|
|
|
84,898 |
|
|
|
162,410 |
|
| Net income |
|
97,856 |
|
|
|
70,424 |
|
|
|
141,346 |
|
|
|
264,560 |
|
|
|
426,957 |
|
| Dividends on preferred
stock |
|
6,117 |
|
|
|
4,108 |
|
|
|
4,127 |
|
|
|
14,344 |
|
|
|
12,031 |
|
| Net income available to common
shareholders |
$ |
91,739 |
|
|
$ |
66,316 |
|
|
$ |
137,219 |
|
|
$ |
250,216 |
|
|
$ |
414,926 |
|
|
Weighted average number of common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
509,227,538 |
|
|
|
509,141,252 |
|
|
|
507,650,668 |
|
|
|
508,904,353 |
|
|
|
507,580,197 |
|
|
Diluted |
|
511,342,932 |
|
|
|
510,338,502 |
|
|
|
509,256,599 |
|
|
|
510,713,205 |
|
|
|
509,204,051 |
|
| Per common share data: |
|
|
|
|
|
|
|
|
|
|
Basic earnings |
$ |
0.18 |
|
|
$ |
0.13 |
|
|
$ |
0.27 |
|
|
$ |
0.49 |
|
|
$ |
0.82 |
|
|
Diluted earnings |
|
0.18 |
|
|
|
0.13 |
|
|
|
0.27 |
|
|
|
0.49 |
|
|
|
0.81 |
|
|
Cash dividends declared |
|
0.11 |
|
|
|
0.11 |
|
|
|
0.11 |
|
|
|
0.33 |
|
|
|
0.33 |
|
| Closing stock price -
high |
|
9.34 |
|
|
|
8.02 |
|
|
|
10.30 |
|
|
|
10.80 |
|
|
|
12.59 |
|
| Closing stock price - low |
|
6.58 |
|
|
|
6.52 |
|
|
|
7.63 |
|
|
|
6.52 |
|
|
|
6.59 |
|
| FINANCIAL
RATIOS: |
|
|
|
|
|
|
|
|
|
| Net interest margin |
|
2.85 |
% |
|
|
2.83 |
% |
|
|
2.90 |
% |
|
|
2.82 |
% |
|
|
2.99 |
% |
| Net interest margin -
FTE(1) |
|
2.86 |
|
|
|
2.84 |
|
|
|
2.91 |
|
|
|
2.83 |
|
|
|
3.00 |
|
| Annualized return on average
assets |
|
0.63 |
|
|
|
0.46 |
|
|
|
0.92 |
|
|
|
0.57 |
|
|
|
0.93 |
|
| Annualized return on avg.
shareholders' equity |
|
5.70 |
|
|
|
4.17 |
|
|
|
8.56 |
|
|
|
5.20 |
|
|
|
8.72 |
|
| NON-GAAP FINANCIAL
DATA AND RATIOS:(2) |
|
|
|
|
|
|
|
|
|
| Basic earnings per share, as
adjusted |
$ |
0.18 |
|
|
$ |
0.13 |
|
|
$ |
0.26 |
|
|
$ |
0.50 |
|
|
$ |
0.84 |
|
| Diluted earnings per share, as
adjusted |
|
0.18 |
|
|
|
0.13 |
|
|
|
0.26 |
|
|
|
0.50 |
|
|
|
0.84 |
|
| Annualized return on average
assets, as adjusted |
|
0.62 |
% |
|
|
0.47 |
% |
|
|
0.89 |
% |
|
|
0.58 |
% |
|
|
0.96 |
% |
| Annualized return on average
shareholders' equity, as adjusted |
|
5.64 |
|
|
|
4.24 |
|
|
|
8.26 |
|
|
|
5.27 |
|
|
|
8.94 |
|
| Annualized return on avg.
tangible shareholders' equity |
|
8.06 |
|
|
|
5.95 |
|
|
|
12.39 |
|
|
|
7.40 |
|
|
|
12.71 |
|
| Annualized return on average
tangible shareholders' equity, as adjusted |
|
7.97 |
|
|
|
6.05 |
|
|
|
11.95 |
|
|
|
7.50 |
|
|
|
13.04 |
|
| Efficiency ratio |
|
56.13 |
|
|
|
59.62 |
|
|
|
56.72 |
|
|
|
58.26 |
|
|
|
55.34 |
|
| |
|
|
|
|
|
|
|
|
|
| AVERAGE BALANCE SHEET
ITEMS: |
|
|
|
|
|
|
|
|
|
| Assets |
$ |
62,242,022 |
|
|
$ |
61,518,639 |
|
|
$ |
61,391,688 |
|
|
$ |
61,674,588 |
|
|
$ |
61,050,973 |
|
| Interest earning assets |
|
57,651,650 |
|
|
|
56,772,950 |
|
|
|
56,802,565 |
|
|
|
57,016,790 |
|
|
|
56,510,997 |
|
| Loans |
|
50,126,963 |
|
|
|
50,020,901 |
|
|
|
50,019,414 |
|
|
|
50,131,468 |
|
|
|
49,120,153 |
|
| Interest bearing
liabilities |
|
42,656,956 |
|
|
|
41,576,344 |
|
|
|
40,829,078 |
|
|
|
41,932,616 |
|
|
|
39,802,966 |
|
| Deposits |
|
50,409,234 |
|
|
|
49,383,209 |
|
|
|
49,848,446 |
|
|
|
49,459,617 |
|
|
|
48,165,152 |
|
| Shareholders' equity |
|
6,862,555 |
|
|
|
6,753,981 |
|
|
|
6,605,786 |
|
|
|
6,781,022 |
|
|
|
6,531,424 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
As Of |
| BALANCE SHEET
ITEMS: |
September 30, |
|
June 30, |
|
March 31, |
|
December |
|
September 30, |
| (In thousands) |
2024 |
|
2024 |
|
2024 |
|
2023 |
|
2023 |
|
Assets |
$ |
62,092,332 |
|
|
$ |
62,058,974 |
|
|
$ |
61,000,188 |
|
|
$ |
60,934,974 |
|
|
$ |
61,183,352 |
|
| Total loans |
|
49,355,319 |
|
|
|
50,311,702 |
|
|
|
49,922,042 |
|
|
|
50,210,295 |
|
|
|
50,097,519 |
|
| Deposits |
|
50,395,966 |
|
|
|
50,112,177 |
|
|
|
49,077,946 |
|
|
|
49,242,829 |
|
|
|
49,885,314 |
|
| Shareholders' equity |
|
6,972,380 |
|
|
|
6,737,737 |
|
|
|
6,727,139 |
|
|
|
6,701,391 |
|
|
|
6,627,299 |
|
| |
|
|
|
|
|
|
|
|
|
| LOANS: |
|
|
|
|
|
|
|
|
|
| (In thousands) |
|
|
|
|
|
|
|
|
|
| Commercial and industrial |
$ |
9,799,287 |
|
|
$ |
9,479,147 |
|
|
$ |
9,104,193 |
|
|
$ |
9,230,543 |
|
|
$ |
9,274,630 |
|
| Commercial real estate: |
|
|
|
|
|
|
|
|
|
|
Non-owner occupied |
|
12,647,649 |
|
|
|
13,710,015 |
|
|
|
14,962,851 |
|
|
|
15,078,464 |
|
|
|
14,741,668 |
|
|
Multifamily |
|
8,612,936 |
|
|
|
8,976,264 |
|
|
|
8,818,263 |
|
|
|
8,860,219 |
|
|
|
8,863,529 |
|
|
Owner occupied |
|
5,654,147 |
|
|
|
5,536,844 |
|
|
|
4,367,839 |
|
|
|
4,304,556 |
|
|
|
4,435,853 |
|
|
Construction |
|
3,487,464 |
|
|
|
3,545,723 |
|
|
|
3,556,511 |
|
|
|
3,726,808 |
|
|
|
3,833,269 |
|
|
Total commercial real estate |
|
30,402,196 |
|
|
|
31,768,846 |
|
|
|
31,705,464 |
|
|
|
31,970,047 |
|
|
|
31,874,319 |
|
| Residential mortgage |
|
5,684,079 |
|
|
|
5,627,113 |
|
|
|
5,618,355 |
|
|
|
5,569,010 |
|
|
|
5,562,665 |
|
| Consumer: |
|
|
|
|
|
|
|
|
|
|
Home equity |
|
581,181 |
|
|
|
566,467 |
|
|
|
564,083 |
|
|
|
559,152 |
|
|
|
548,918 |
|
|
Automobile |
|
1,823,738 |
|
|
|
1,762,852 |
|
|
|
1,700,508 |
|
|
|
1,620,389 |
|
|
|
1,585,987 |
|
|
Other consumer |
|
1,064,838 |
|
|
|
1,107,277 |
|
|
|
1,229,439 |
|
|
|
1,261,154 |
|
|
|
1,251,000 |
|
|
Total consumer loans |
|
3,469,757 |
|
|
|
3,436,596 |
|
|
|
3,494,030 |
|
|
|
3,440,695 |
|
|
|
3,385,905 |
|
| Total loans |
$ |
49,355,319 |
|
|
$ |
50,311,702 |
|
|
$ |
49,922,042 |
|
|
$ |
50,210,295 |
|
|
$ |
50,097,519 |
|
| |
|
|
|
|
|
|
|
|
|
| CAPITAL
RATIOS: |
|
|
|
|
|
|
|
|
|
| Book value per common
share |
$ |
13.00 |
|
|
$ |
12.82 |
|
|
$ |
12.81 |
|
|
$ |
12.79 |
|
|
$ |
12.64 |
|
| Tangible book value per common
share(2) |
|
9.06 |
|
|
|
8.87 |
|
|
|
8.84 |
|
|
|
8.79 |
|
|
|
8.63 |
|
| Tangible common equity to
tangible assets(2) |
|
7.68 |
% |
|
|
7.52 |
% |
|
|
7.62 |
% |
|
|
7.58 |
% |
|
|
7.40 |
% |
| Tier 1 leverage capital |
|
8.40 |
|
|
|
8.19 |
|
|
|
8.20 |
|
|
|
8.16 |
|
|
|
8.08 |
|
| Common equity tier 1
capital |
|
9.57 |
|
|
|
9.55 |
|
|
|
9.34 |
|
|
|
9.29 |
|
|
|
9.21 |
|
| Tier 1 risk-based capital |
|
10.29 |
|
|
|
9.99 |
|
|
|
9.78 |
|
|
|
9.72 |
|
|
|
9.64 |
|
| Total risk-based capital |
|
12.56 |
|
|
|
12.18 |
|
|
|
11.88 |
|
|
|
11.76 |
|
|
|
11.68 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Three Months Ended |
|
Nine Months Ended |
| ALLOWANCE FOR CREDIT
LOSSES: |
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
| ($ in thousands) |
2024 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
| Allowance for credit
losses for loans |
|
|
|
|
|
|
|
|
|
|
Beginning balance |
$ |
532,541 |
|
|
$ |
487,269 |
|
|
$ |
458,676 |
|
|
$ |
465,550 |
|
|
$ |
483,255 |
|
| Impact of the adoption of ASU
No. 2022-02 |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,368 |
) |
| Beginning balance,
adjusted |
|
532,541 |
|
|
|
487,269 |
|
|
|
458,676 |
|
|
|
465,550 |
|
|
|
481,887 |
|
| Loans charged-off: |
|
|
|
|
|
|
|
|
|
|
Commercial and industrial |
|
(7,501 |
) |
|
|
(14,721 |
) |
|
|
(7,487 |
) |
|
|
(36,515 |
) |
|
|
(37,399 |
) |
|
Commercial real estate |
|
(33,292 |
) |
|
|
(22,144 |
) |
|
|
(255 |
) |
|
|
(56,640 |
) |
|
|
(2,320 |
) |
|
Construction |
|
(4,831 |
) |
|
|
(212 |
) |
|
|
— |
|
|
|
(12,637 |
) |
|
|
(9,906 |
) |
|
Residential mortgage |
|
— |
|
|
|
— |
|
|
|
(20 |
) |
|
|
— |
|
|
|
(169 |
) |
|
Total consumer |
|
(2,597 |
) |
|
|
(1,262 |
) |
|
|
(1,156 |
) |
|
|
(5,668 |
) |
|
|
(3,024 |
) |
| Total loans charged-off |
|
(48,221 |
) |
|
|
(38,339 |
) |
|
|
(8,918 |
) |
|
|
(111,460 |
) |
|
|
(52,818 |
) |
| Charged-off loans
recovered: |
|
|
|
|
|
|
|
|
|
|
Commercial and industrial |
|
3,162 |
|
|
|
742 |
|
|
|
3,043 |
|
|
|
4,586 |
|
|
|
6,615 |
|
|
Commercial real estate |
|
66 |
|
|
|
150 |
|
|
|
5 |
|
|
|
457 |
|
|
|
33 |
|
|
Construction |
|
1,535 |
|
|
|
— |
|
|
|
— |
|
|
|
1,535 |
|
|
|
— |
|
|
Residential mortgage |
|
29 |
|
|
|
5 |
|
|
|
30 |
|
|
|
59 |
|
|
|
186 |
|
|
Total consumer |
|
521 |
|
|
|
603 |
|
|
|
362 |
|
|
|
1,521 |
|
|
|
1,513 |
|
| Total loans recovered |
|
5,313 |
|
|
|
1,500 |
|
|
|
3,440 |
|
|
|
8,158 |
|
|
|
8,347 |
|
| Total net charge-offs |
|
(42,908 |
) |
|
|
(36,839 |
) |
|
|
(5,478 |
) |
|
|
(103,302 |
) |
|
|
(44,471 |
) |
| Provision for credit losses
for loans |
|
75,038 |
|
|
|
82,111 |
|
|
|
9,147 |
|
|
|
202,423 |
|
|
|
24,929 |
|
| Ending balance |
$ |
564,671 |
|
|
$ |
532,541 |
|
|
$ |
462,345 |
|
|
$ |
564,671 |
|
|
$ |
462,345 |
|
| Components of
allowance for credit losses for loans: |
|
|
|
|
|
|
|
|
|
|
Allowance for loan losses |
$ |
548,327 |
|
|
$ |
519,310 |
|
|
$ |
442,175 |
|
|
$ |
548,327 |
|
|
$ |
442,175 |
|
|
Allowance for unfunded credit commitments |
|
16,344 |
|
|
|
13,231 |
|
|
|
20,170 |
|
|
|
16,344 |
|
|
|
20,170 |
|
| Allowance for credit losses
for loans |
$ |
564,671 |
|
|
$ |
532,541 |
|
|
$ |
462,345 |
|
|
$ |
564,671 |
|
|
$ |
462,345 |
|
| Components of
provision for credit losses for loans: |
|
|
|
|
|
|
|
|
|
|
Provision for credit losses for loans |
$ |
71,925 |
|
|
$ |
86,901 |
|
|
$ |
11,221 |
|
|
$ |
205,549 |
|
|
$ |
29,359 |
|
|
Provision (credit) for unfunded credit commitments |
|
3,113 |
|
|
|
(4,790 |
) |
|
|
(2,074 |
) |
|
|
(3,126 |
) |
|
|
(4,430 |
) |
| Total provision for credit
losses for loans |
$ |
75,038 |
|
|
$ |
82,111 |
|
|
$ |
9,147 |
|
|
$ |
202,423 |
|
|
$ |
24,929 |
|
| Annualized ratio of total net
charge-offs to total average loans |
|
0.34 |
% |
|
|
0.29 |
% |
|
|
0.04 |
% |
|
|
0.27 |
% |
|
|
0.12 |
% |
| Allowance for credit losses
for loans as a % of total loans |
|
1.14 |
% |
|
|
1.06 |
% |
|
|
0.92 |
% |
|
|
1.14 |
% |
|
|
0.92 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
As Of |
| ASSET
QUALITY: |
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
| ($ in thousands) |
2024 |
|
2024 |
|
2024 |
|
2023 |
|
2023 |
| Accruing past due loans: |
|
|
|
|
|
|
|
|
|
| 30 to 59 days past due: |
|
|
|
|
|
|
|
|
|
|
Commercial and industrial |
$ |
4,537 |
|
|
$ |
5,086 |
|
|
$ |
6,202 |
|
|
$ |
9,307 |
|
|
$ |
10,687 |
|
|
Commercial real estate |
|
76,370 |
|
|
|
1,879 |
|
|
|
5,791 |
|
|
|
3,008 |
|
|
|
8,053 |
|
|
Residential mortgage |
|
19,549 |
|
|
|
17,389 |
|
|
|
20,819 |
|
|
|
26,345 |
|
|
|
13,159 |
|
|
Total consumer |
|
14,672 |
|
|
|
21,639 |
|
|
|
14,032 |
|
|
|
20,554 |
|
|
|
15,509 |
|
| Total 30 to 59 days past
due |
|
115,128 |
|
|
|
45,993 |
|
|
|
46,844 |
|
|
|
59,214 |
|
|
|
47,408 |
|
| 60 to 89 days past due: |
|
|
|
|
|
|
|
|
|
|
Commercial and industrial |
|
1,238 |
|
|
|
1,621 |
|
|
|
2,665 |
|
|
|
5,095 |
|
|
|
5,720 |
|
|
Commercial real estate |
|
43,926 |
|
|
|
— |
|
|
|
3,720 |
|
|
|
1,257 |
|
|
|
2,620 |
|
|
Residential mortgage |
|
6,892 |
|
|
|
6,632 |
|
|
|
5,970 |
|
|
|
8,200 |
|
|
|
9,710 |
|
|
Total consumer |
|
2,732 |
|
|
|
3,671 |
|
|
|
1,834 |
|
|
|
4,715 |
|
|
|
1,720 |
|
| Total 60 to 89 days past
due |
|
54,788 |
|
|
|
11,924 |
|
|
|
14,189 |
|
|
|
19,267 |
|
|
|
19,770 |
|
| 90 or more days past due: |
|
|
|
|
|
|
|
|
|
|
Commercial and industrial |
|
1,786 |
|
|
|
2,739 |
|
|
|
5,750 |
|
|
|
5,579 |
|
|
|
6,629 |
|
|
Commercial real estate |
|
— |
|
|
|
4,242 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Construction |
|
— |
|
|
|
3,990 |
|
|
|
3,990 |
|
|
|
3,990 |
|
|
|
3,990 |
|
|
Residential mortgage |
|
1,931 |
|
|
|
2,609 |
|
|
|
2,884 |
|
|
|
2,488 |
|
|
|
1,348 |
|
|
Total consumer |
|
1,063 |
|
|
|
898 |
|
|
|
731 |
|
|
|
1,088 |
|
|
|
391 |
|
| Total 90 or more days past
due |
|
4,780 |
|
|
|
14,478 |
|
|
|
13,355 |
|
|
|
13,145 |
|
|
|
12,358 |
|
| Total accruing past due
loans |
$ |
174,696 |
|
|
$ |
72,395 |
|
|
$ |
74,388 |
|
|
$ |
91,626 |
|
|
$ |
79,536 |
|
| Non-accrual loans: |
|
|
|
|
|
|
|
|
|
|
Commercial and industrial |
$ |
120,575 |
|
|
$ |
102,942 |
|
|
$ |
102,399 |
|
|
$ |
99,912 |
|
|
$ |
87,655 |
|
|
Commercial real estate |
|
113,752 |
|
|
|
123,011 |
|
|
|
100,052 |
|
|
|
99,739 |
|
|
|
83,338 |
|
|
Construction |
|
24,657 |
|
|
|
45,380 |
|
|
|
51,842 |
|
|
|
60,851 |
|
|
|
62,788 |
|
|
Residential mortgage |
|
33,075 |
|
|
|
28,322 |
|
|
|
28,561 |
|
|
|
26,986 |
|
|
|
21,614 |
|
|
Total consumer |
|
4,260 |
|
|
|
3,624 |
|
|
|
4,438 |
|
|
|
4,383 |
|
|
|
3,545 |
|
| Total non-accrual loans |
|
296,319 |
|
|
|
303,279 |
|
|
|
287,292 |
|
|
|
291,871 |
|
|
|
258,940 |
|
| Other real estate owned
(OREO) |
|
7,172 |
|
|
|
8,059 |
|
|
|
88 |
|
|
|
71 |
|
|
|
71 |
|
| Other repossessed assets |
|
1,611 |
|
|
|
1,607 |
|
|
|
1,393 |
|
|
|
1,444 |
|
|
|
1,314 |
|
| Total non-performing
assets |
$ |
305,102 |
|
|
$ |
312,945 |
|
|
$ |
288,773 |
|
|
$ |
293,386 |
|
|
$ |
260,325 |
|
| Total non-accrual loans as a %
of loans |
|
0.60 |
% |
|
|
0.60 |
% |
|
|
0.58 |
% |
|
|
0.58 |
% |
|
|
0.52 |
% |
| Total accruing past due and
non-accrual loans as a % of loans |
|
0.95 |
|
|
|
0.75 |
|
|
|
0.72 |
|
|
|
0.76 |
|
|
|
0.68 |
|
| Allowance for losses on loans
as a % of non-accrual loans |
|
185.05 |
|
|
|
171.23 |
|
|
|
163.33 |
|
|
|
152.83 |
|
|
|
170.76 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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) |
|
Non-GAAP Reconciliations. 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. The
Company believes that the non-GAAP financial measures provide
useful supplemental information to both management and investors in
understanding Valley’s underlying operational performance, business
and performance trends, and may facilitate comparisons of our
current and prior performance with the performance of others in the
financial services industry. Management utilizes these measures for
internal planning, forecasting and analysis purposes. Management
believes that Valley’s presentation and discussion of this
supplemental information, together with the accompanying
reconciliations to the GAAP financial measures, also allows
investors to view performance in a manner similar to management.
These non-GAAP financial measures should not be considered in
isolation or as a substitute for or superior to financial measures
calculated in accordance with U.S. GAAP. These non-GAAP financial
measures may also be calculated differently from similar measures
disclosed by other companies. |
|
|
|
|
|
|
|
Non-GAAP Reconciliations to GAAP Financial
Measures |
|
|
| |
Three Months Ended |
|
Nine Months Ended |
| |
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
| ($ in thousands, except for
share data) |
2024 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
| Adjusted net income
available to common shareholders (non-GAAP): |
|
|
|
|
|
|
|
|
|
|
Net income, as reported (GAAP) |
$ |
97,856 |
|
|
$ |
70,424 |
|
|
$ |
141,346 |
|
|
$ |
264,560 |
|
|
$ |
426,957 |
|
|
Add: FDIC Special assessment (a) |
|
— |
|
|
|
1,363 |
|
|
|
— |
|
|
|
8,757 |
|
|
|
— |
|
|
Add: Losses on available for sale and held to maturity debt
securities, net (b) |
|
1 |
|
|
|
4 |
|
|
|
443 |
|
|
|
12 |
|
|
|
476 |
|
|
Add: Restructuring charge (c) |
|
— |
|
|
|
334 |
|
|
|
(675 |
) |
|
|
954 |
|
|
|
10,507 |
|
|
Add: Mark to market loss on commercial real estate loans
transferred to loans held for sale (d) |
|
5,794 |
|
|
|
— |
|
|
|
— |
|
|
|
5,794 |
|
|
|
— |
|
|
Add: Provision for credit losses for available for sale
securities (e) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5,000 |
|
|
Add: Merger related expenses (f) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4,133 |
|
|
Less: Litigation settlements (g) |
|
(7,334 |
) |
|
|
— |
|
|
|
— |
|
|
|
(7,334 |
) |
|
|
— |
|
|
Less: Gain on sale of commercial premium finance lending
division (h) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3,629 |
) |
|
|
— |
|
|
Less: Net gains on sales of office buildings (h) |
|
— |
|
|
|
— |
|
|
|
(6,721 |
) |
|
|
— |
|
|
|
(6,721 |
) |
| Total non-GAAP adjustments to
net income |
|
(1,539 |
) |
|
|
1,701 |
|
|
|
(6,953 |
) |
|
|
4,554 |
|
|
|
13,395 |
|
|
Income tax adjustments related to non-GAAP
adjustments (i) |
|
437 |
|
|
|
(482 |
) |
|
|
1,970 |
|
|
|
(1,269 |
) |
|
|
(2,378 |
) |
| Net income, as adjusted
(non-GAAP) |
$ |
96,754 |
|
|
$ |
71,643 |
|
|
$ |
136,363 |
|
|
$ |
267,845 |
|
|
$ |
437,974 |
|
| Dividends on preferred
stock |
|
6,117 |
|
|
|
4,108 |
|
|
|
4,127 |
|
|
|
14,344 |
|
|
|
12,031 |
|
| Net income available to common
shareholders, as adjusted (non-GAAP) |
$ |
90,637 |
|
|
$ |
67,535 |
|
|
$ |
132,236 |
|
|
$ |
253,501 |
|
|
$ |
425,943 |
|
| __________ |
|
|
|
|
|
|
|
|
|
|
(a) Included in the FDIC insurance expense. |
|
(b) Included in gains (losses) on securities transactions,
net. |
|
(c) Represents severance expense related to workforce reductions
within salary and employee benefits expense. |
|
(d) Included in (losses) gains on sales of loans, net. |
|
(e) Included in provision for credit losses for available for sale
and held to maturity securities (tax disallowed). |
|
(f) Included in salary and employee benefits expense during the
first quarter 2023. |
|
(g) Represents recoveries from legal settlements included in other
income. |
|
(h) Included in gains (losses) on sales of assets, net within
non-interest income. |
|
(i) Calculated using the appropriate blended statutory tax rate for
the applicable period. |
| |
| Adjusted per common
share data (non-GAAP): |
|
|
|
|
|
|
|
|
|
| Net income available to common
shareholders, as adjusted (non-GAAP) |
$ |
90,637 |
|
|
$ |
67,535 |
|
|
$ |
132,236 |
|
|
$ |
253,501 |
|
|
$ |
425,943 |
|
| Average number of shares
outstanding |
|
509,227,538 |
|
|
|
509,141,252 |
|
|
|
507,650,668 |
|
|
|
508,904,353 |
|
|
|
507,580,197 |
|
|
Basic earnings, as adjusted (non-GAAP) |
$ |
0.18 |
|
|
$ |
0.13 |
|
|
$ |
0.26 |
|
|
$ |
0.50 |
|
|
$ |
0.84 |
|
| Average number of diluted
shares outstanding |
|
511,342,932 |
|
|
|
510,338,502 |
|
|
|
509,256,599 |
|
|
|
510,713,205 |
|
|
|
509,204,051 |
|
|
Diluted earnings, as adjusted (non-GAAP) |
$ |
0.18 |
|
|
$ |
0.13 |
|
|
$ |
0.26 |
|
|
$ |
0.50 |
|
|
$ |
0.84 |
|
| Adjusted annualized
return on average tangible shareholders' equity
(non-GAAP): |
|
|
|
|
|
|
|
|
|
| Net income, as adjusted
(non-GAAP) |
$ |
96,754 |
|
|
$ |
71,643 |
|
|
$ |
136,363 |
|
|
$ |
267,845 |
|
|
$ |
437,974 |
|
| Average shareholders'
equity |
$ |
6,862,555 |
|
|
$ |
6,753,981 |
|
|
$ |
6,605,786 |
|
|
$ |
6,781,022 |
|
|
$ |
6,531,424 |
|
|
Less: Average goodwill and other intangible assets |
|
2,008,692 |
|
|
|
2,016,766 |
|
|
|
2,042,486 |
|
|
|
2,016,790 |
|
|
|
2,051,727 |
|
| Average tangible shareholders'
equity |
$ |
4,853,863 |
|
|
$ |
4,737,215 |
|
|
$ |
4,563,300 |
|
|
$ |
4,764,232 |
|
|
$ |
4,479,697 |
|
| Annualized return on average
tangible shareholders' equity, as adjusted (non-GAAP) |
|
7.97 |
% |
|
|
6.05 |
% |
|
|
11.95 |
% |
|
|
7.50 |
% |
|
|
13.04 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Reconciliations to GAAP Financial Measures
(Continued) |
| |
| |
Three Months Ended |
|
Nine Months Ended |
| |
September 30, |
|
June 30, |
|
September 30, |
|
September 30, |
| ($ in thousands, except for
share data) |
2024 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
| Adjusted annualized
return on average assets (non-GAAP): |
|
|
|
|
|
|
|
|
|
|
Net income, as adjusted (non-GAAP) |
$ |
96,754 |
|
|
$ |
71,643 |
|
|
$ |
136,363 |
|
|
$ |
267,845 |
|
|
$ |
437,974 |
|
| Average assets |
$ |
62,242,022 |
|
|
$ |
61,518,639 |
|
|
$ |
61,391,688 |
|
|
$ |
61,674,588 |
|
|
$ |
61,050,973 |
|
| Annualized return on average
assets, as adjusted (non-GAAP) |
|
0.62 |
% |
|
|
0.47 |
% |
|
|
0.89 |
% |
|
|
0.58 |
% |
|
|
0.96 |
% |
| Adjusted annualized
return on average shareholders' equity (non-GAAP): |
|
|
|
|
|
|
|
|
|
| Net income, as adjusted
(non-GAAP) |
$ |
96,754 |
|
|
$ |
71,643 |
|
|
$ |
136,363 |
|
|
$ |
267,845 |
|
|
$ |
437,974 |
|
| Average shareholders'
equity |
$ |
6,862,555 |
|
|
$ |
6,753,981 |
|
|
$ |
6,605,786 |
|
|
$ |
6,781,022 |
|
|
$ |
6,531,424 |
|
| Annualized return on average
shareholders' equity, as adjusted (non-GAAP) |
|
5.64 |
% |
|
|
4.24 |
% |
|
|
8.26 |
% |
|
|
5.27 |
% |
|
|
8.94 |
% |
| Annualized return on
average tangible shareholders' equity (non-GAAP): |
|
|
|
|
|
|
|
|
|
| Net income, as reported
(GAAP) |
$ |
97,856 |
|
|
$ |
70,424 |
|
|
$ |
141,346 |
|
|
$ |
264,560 |
|
|
$ |
426,957 |
|
| Average shareholders'
equity |
$ |
6,862,555 |
|
|
$ |
6,753,981 |
|
|
$ |
6,605,786 |
|
|
$ |
6,781,022 |
|
|
$ |
6,531,424 |
|
|
Less: Average goodwill and other intangible assets |
|
2,008,692 |
|
|
|
2,016,766 |
|
|
|
2,042,486 |
|
|
|
2,016,790 |
|
|
|
2,051,727 |
|
| Average tangible shareholders'
equity |
$ |
4,853,863 |
|
|
$ |
4,737,215 |
|
|
$ |
4,563,300 |
|
|
$ |
4,764,232 |
|
|
$ |
4,479,697 |
|
| Annualized return on average
tangible shareholders' equity (non-GAAP) |
|
8.06 |
% |
|
|
5.95 |
% |
|
|
12.39 |
% |
|
|
7.40 |
% |
|
|
12.71 |
% |
| Efficiency ratio
(non-GAAP): |
|
|
|
|
|
|
|
|
|
| Non-interest expense, as
reported (GAAP) |
$ |
269,471 |
|
|
$ |
277,497 |
|
|
$ |
267,133 |
|
|
$ |
827,278 |
|
|
$ |
822,270 |
|
|
Less: FDIC Special assessment (pre-tax) |
|
— |
|
|
|
1,363 |
|
|
|
— |
|
|
|
8,757 |
|
|
|
— |
|
|
Less: Restructuring charge (pre-tax) |
|
— |
|
|
|
334 |
|
|
|
(675 |
) |
|
|
954 |
|
|
|
10,507 |
|
|
Less: Merger-related expenses (pre-tax) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4,133 |
|
|
Less: Amortization of tax credit investments (pre-tax) |
|
5,853 |
|
|
|
5,791 |
|
|
|
4,191 |
|
|
|
17,206 |
|
|
|
13,462 |
|
| Non-interest expense, as
adjusted (non-GAAP) |
$ |
263,618 |
|
|
$ |
270,009 |
|
|
$ |
263,617 |
|
|
$ |
800,361 |
|
|
$ |
794,168 |
|
| Net interest income, as
reported (GAAP) |
|
410,498 |
|
|
|
401,685 |
|
|
|
412,418 |
|
|
|
1,205,731 |
|
|
|
1,268,203 |
|
| Non-interest income, as
reported (GAAP) |
|
60,671 |
|
|
|
51,213 |
|
|
|
58,664 |
|
|
|
173,299 |
|
|
|
173,038 |
|
|
Add: Losses on available for sale and held to maturity securities
transactions, net (pre-tax) |
|
1 |
|
|
|
4 |
|
|
|
443 |
|
|
|
12 |
|
|
|
476 |
|
|
Add: Mark-to-market loss on commercial real estate loans
transferred to loans held for sale (pre-tax) |
|
5,794 |
|
|
|
— |
|
|
|
— |
|
|
|
5,794 |
|
|
|
— |
|
|
Less: Litigation settlements (pre-tax) |
|
(7,334 |
) |
|
|
— |
|
|
|
— |
|
|
|
(7,334 |
) |
|
|
— |
|
|
Less: Gain on sale of premium finance division (pre-tax) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3,629 |
) |
|
|
— |
|
|
Less: Net gains on sales of office buildings (pre-tax) |
|
— |
|
|
|
— |
|
|
|
(6,721 |
) |
|
|
— |
|
|
|
(6,721 |
) |
| Non-interest income, as
adjusted (non-GAAP) |
$ |
59,132 |
|
|
$ |
51,217 |
|
|
$ |
52,386 |
|
|
$ |
168,142 |
|
|
$ |
166,793 |
|
|
Gross operating income, as adjusted (non-GAAP) |
$ |
469,630 |
|
|
$ |
452,902 |
|
|
$ |
464,804 |
|
|
$ |
1,373,873 |
|
|
$ |
1,434,996 |
|
|
Efficiency ratio (non-GAAP) |
|
56.13 |
% |
|
|
59.62 |
% |
|
|
56.72 |
% |
|
|
58.26 |
% |
|
|
55.34 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
As of |
| |
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
| ($ in thousands, except for
share data) |
2024 |
|
2024 |
|
2024 |
|
2023 |
|
2023 |
| Tangible book value
per common share (non-GAAP): |
|
|
|
|
|
|
|
|
|
|
Common shares outstanding |
|
509,252,936 |
|
|
|
509,205,014 |
|
|
|
508,893,059 |
|
|
|
507,709,927 |
|
|
|
507,660,742 |
|
| Shareholders' equity
(GAAP) |
$ |
6,972,380 |
|
|
$ |
6,737,737 |
|
|
$ |
6,727,139 |
|
|
$ |
6,701,391 |
|
|
$ |
6,627,299 |
|
|
Less: Preferred stock |
|
354,345 |
|
|
|
209,691 |
|
|
|
209,691 |
|
|
|
209,691 |
|
|
|
209,691 |
|
|
Less: Goodwill and other intangible assets |
|
2,004,414 |
|
|
|
2,012,580 |
|
|
|
2,020,405 |
|
|
|
2,029,267 |
|
|
|
2,038,202 |
|
| Tangible common shareholders'
equity (non-GAAP) |
$ |
4,613,621 |
|
|
$ |
4,515,466 |
|
|
$ |
4,497,043 |
|
|
$ |
4,462,433 |
|
|
$ |
4,379,406 |
|
|
Tangible book value per common share (non-GAAP) |
$ |
9.06 |
|
|
$ |
8.87 |
|
|
$ |
8.84 |
|
|
$ |
8.79 |
|
|
$ |
8.63 |
|
| Tangible common equity
to tangible assets (non-GAAP): |
|
|
|
|
|
|
|
|
|
| Tangible common shareholders'
equity (non-GAAP) |
$ |
4,613,621 |
|
|
$ |
4,515,466 |
|
|
$ |
4,497,043 |
|
|
$ |
4,462,433 |
|
|
$ |
4,379,406 |
|
| Total assets (GAAP) |
|
62,092,332 |
|
|
|
62,058,974 |
|
|
|
61,000,188 |
|
|
|
60,934,974 |
|
|
|
61,183,352 |
|
|
Less: Goodwill and other intangible assets |
|
2,004,414 |
|
|
|
2,012,580 |
|
|
|
2,020,405 |
|
|
|
2,029,267 |
|
|
|
2,038,202 |
|
| Tangible assets
(non-GAAP) |
$ |
60,087,918 |
|
|
$ |
60,046,394 |
|
|
$ |
58,979,783 |
|
|
$ |
58,905,707 |
|
|
$ |
59,145,150 |
|
|
Tangible common equity to tangible assets (non-GAAP) |
|
7.68 |
% |
|
|
7.52 |
% |
|
|
7.62 |
% |
|
|
7.58 |
% |
|
|
7.40 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VALLEY NATIONAL BANCORPCONSOLIDATED
STATEMENTS OF FINANCIAL CONDITION(in thousands,
except for share data)
| |
September 30, |
|
December 31, |
| |
2024 |
|
2023 |
| |
(Unaudited) |
|
|
| Assets |
|
|
|
|
Cash and due from banks |
$ |
511,945 |
|
|
$ |
284,090 |
|
| Interest bearing deposits with
banks |
|
527,960 |
|
|
|
607,135 |
|
| Investment securities: |
|
|
|
|
Equity securities |
|
73,071 |
|
|
|
64,464 |
|
|
Trading debt securities |
|
3,996 |
|
|
|
3,973 |
|
|
Available for sale debt securities |
|
2,602,260 |
|
|
|
1,296,576 |
|
| Held to maturity debt securities
(net of allowance for credit losses of $1,076 at September 30,
2024 and $1,205 at December 31, 2023) |
|
3,573,960 |
|
|
|
3,739,208 |
|
|
Total investment securities |
|
6,253,287 |
|
|
|
5,104,221 |
|
| Loans held for sale (includes
fair value of $17,153 at September 30, 2024 and $20,640 at
December 31, 2023 for loans originated for sale) |
|
843,201 |
|
|
|
30,640 |
|
| Loans |
|
49,355,319 |
|
|
|
50,210,295 |
|
|
Less: Allowance for loan losses |
|
(548,327 |
) |
|
|
(446,080 |
) |
|
Net loans |
|
48,806,992 |
|
|
|
49,764,215 |
|
| Premises and equipment,
net |
|
356,649 |
|
|
|
381,081 |
|
| Lease right of use assets |
|
335,032 |
|
|
|
343,461 |
|
| Bank owned life insurance |
|
730,081 |
|
|
|
723,799 |
|
| Accrued interest receivable |
|
250,131 |
|
|
|
245,498 |
|
| Goodwill |
|
1,868,936 |
|
|
|
1,868,936 |
|
| Other intangible assets, net |
|
135,478 |
|
|
|
160,331 |
|
| Other assets |
|
1,472,640 |
|
|
|
1,421,567 |
|
|
Total Assets |
$ |
62,092,332 |
|
|
$ |
60,934,974 |
|
| Liabilities |
|
|
|
| Deposits: |
|
|
|
|
Non-interest bearing |
$ |
11,153,754 |
|
|
$ |
11,539,483 |
|
|
Interest bearing: |
|
|
|
|
Savings, NOW and money market |
|
25,069,405 |
|
|
|
24,526,622 |
|
|
Time |
|
14,172,807 |
|
|
|
13,176,724 |
|
|
Total deposits |
|
50,395,966 |
|
|
|
49,242,829 |
|
| Short-term borrowings |
|
58,268 |
|
|
|
917,834 |
|
| Long-term borrowings |
|
3,274,340 |
|
|
|
2,328,375 |
|
| Junior subordinated debentures
issued to capital trusts |
|
57,368 |
|
|
|
57,108 |
|
| Lease liabilities |
|
394,971 |
|
|
|
403,781 |
|
| Accrued expenses and other
liabilities |
|
939,039 |
|
|
|
1,283,656 |
|
|
Total Liabilities |
|
55,119,952 |
|
|
|
54,233,583 |
|
| Shareholders’
Equity |
|
|
|
| Preferred stock, no par value;
50,000,000 authorized shares: |
|
|
|
| Series A (4,600,000 shares issued
at September 30, 2024 and December 31, 2023) |
|
111,590 |
|
|
|
111,590 |
|
| Series B (4,000,000 shares issued
at September 30, 2024 and December 31, 2023) |
|
98,101 |
|
|
|
98,101 |
|
| Series C (6,000,000 shares issued
at September 30, 2024) |
|
144,654 |
|
|
|
— |
|
| Common stock (no par value,
authorized 650,000,000 shares; issued 509,252,936 shares at
September 30, 2024 and 507,896,910 shares at December 31,
2023) |
|
178,661 |
|
|
|
178,187 |
|
| Surplus |
|
5,002,718 |
|
|
|
4,989,989 |
|
| Retained earnings |
|
1,551,428 |
|
|
|
1,471,371 |
|
| Accumulated other comprehensive
loss |
|
(114,772 |
) |
|
|
(146,456 |
) |
| Treasury stock, at cost (186,983
common shares at December 31, 2023) |
|
— |
|
|
|
(1,391 |
) |
|
Total Shareholders’ Equity |
|
6,972,380 |
|
|
|
6,701,391 |
|
|
Total Liabilities and Shareholders’ Equity |
$ |
62,092,332 |
|
|
$ |
60,934,974 |
|
| |
|
|
|
|
|
|
|
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, |
| |
2024 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
| Interest
Income |
|
|
|
|
|
|
|
|
|
|
Interest and fees on loans |
$ |
786,680 |
|
|
$ |
770,964 |
|
|
$ |
753,638 |
|
|
$ |
2,329,197 |
|
|
$ |
2,124,036 |
| Interest and dividends on
investment securities: |
|
|
|
|
|
|
|
|
|
|
Taxable |
|
49,700 |
|
|
|
40,460 |
|
|
|
32,383 |
|
|
|
125,957 |
|
|
|
96,591 |
|
Tax-exempt |
|
4,855 |
|
|
|
4,799 |
|
|
|
4,585 |
|
|
|
14,450 |
|
|
|
15,485 |
|
Dividends |
|
5,929 |
|
|
|
6,341 |
|
|
|
5,299 |
|
|
|
19,098 |
|
|
|
18,001 |
|
Interest on federal funds sold and other short-term
investments |
|
13,385 |
|
|
|
10,902 |
|
|
|
17,113 |
|
|
|
33,969 |
|
|
|
66,594 |
|
Total interest income |
|
860,549 |
|
|
|
833,466 |
|
|
|
813,018 |
|
|
|
2,522,671 |
|
|
|
2,320,707 |
| Interest
Expense |
|
|
|
|
|
|
|
|
|
| Interest on deposits: |
|
|
|
|
|
|
|
|
|
|
Savings, NOW and money market |
|
235,371 |
|
|
|
231,597 |
|
|
|
201,916 |
|
|
|
699,474 |
|
|
|
517,524 |
|
Time |
|
174,741 |
|
|
|
160,442 |
|
|
|
164,336 |
|
|
|
486,248 |
|
|
|
370,398 |
| Interest on short-term
borrowings |
|
451 |
|
|
|
691 |
|
|
|
5,189 |
|
|
|
21,754 |
|
|
|
89,345 |
|
Interest on long-term borrowings and junior subordinated
debentures |
|
39,488 |
|
|
|
39,051 |
|
|
|
29,159 |
|
|
|
109,464 |
|
|
|
75,237 |
|
Total interest expense |
|
450,051 |
|
|
|
431,781 |
|
|
|
400,600 |
|
|
|
1,316,940 |
|
|
|
1,052,504 |
| Net Interest
Income |
|
410,498 |
|
|
|
401,685 |
|
|
|
412,418 |
|
|
|
1,205,731 |
|
|
|
1,268,203 |
|
(Credit) provision for credit losses for available for sale and
held to maturity securities |
|
(14 |
) |
|
|
(41 |
) |
|
|
(30 |
) |
|
|
(129 |
) |
|
|
4,675 |
| Provision for credit losses for
loans |
|
75,038 |
|
|
|
82,111 |
|
|
|
9,147 |
|
|
|
202,423 |
|
|
|
24,929 |
|
Net Interest Income After Provision for Credit
Losses |
|
335,474 |
|
|
|
319,615 |
|
|
|
403,301 |
|
|
|
1,003,437 |
|
|
|
1,238,599 |
| Non-Interest
Income |
|
|
|
|
|
|
|
|
|
| Wealth management and trust
fees |
|
15,125 |
|
|
|
13,136 |
|
|
|
11,417 |
|
|
|
46,191 |
|
|
|
32,180 |
| Insurance commissions |
|
2,880 |
|
|
|
3,958 |
|
|
|
2,336 |
|
|
|
9,089 |
|
|
|
7,895 |
| Capital markets |
|
6,347 |
|
|
|
7,779 |
|
|
|
7,141 |
|
|
|
19,796 |
|
|
|
35,000 |
| Service charges on deposit
accounts |
|
12,826 |
|
|
|
11,212 |
|
|
|
10,952 |
|
|
|
35,287 |
|
|
|
31,970 |
| Gains (losses) on securities
transactions, net |
|
47 |
|
|
|
3 |
|
|
|
(398 |
) |
|
|
99 |
|
|
|
197 |
| Fees from loan servicing |
|
3,443 |
|
|
|
2,691 |
|
|
|
2,681 |
|
|
|
9,322 |
|
|
|
8,054 |
| (Losses) gains on sales of loans,
net |
|
(3,644 |
) |
|
|
884 |
|
|
|
2,023 |
|
|
|
(1,142 |
) |
|
|
3,752 |
| Gains (losses) on sales of
assets, net |
|
55 |
|
|
|
(2 |
) |
|
|
6,653 |
|
|
|
3,747 |
|
|
|
6,938 |
| Bank owned life insurance |
|
5,387 |
|
|
|
4,545 |
|
|
|
2,709 |
|
|
|
13,167 |
|
|
|
7,736 |
| Other |
|
18,205 |
|
|
|
7,007 |
|
|
|
13,150 |
|
|
|
37,743 |
|
|
|
39,316 |
|
Total non-interest income |
|
60,671 |
|
|
|
51,213 |
|
|
|
58,664 |
|
|
|
173,299 |
|
|
|
173,038 |
| Non-Interest
Expense |
|
|
|
|
|
|
|
|
|
| Salary and employee benefits
expense |
|
138,832 |
|
|
|
140,815 |
|
|
|
137,292 |
|
|
|
421,478 |
|
|
|
431,872 |
| Net occupancy expense |
|
26,973 |
|
|
|
24,252 |
|
|
|
24,675 |
|
|
|
75,548 |
|
|
|
73,880 |
| Technology, furniture and
equipment expense |
|
28,962 |
|
|
|
35,203 |
|
|
|
37,320 |
|
|
|
99,627 |
|
|
|
106,304 |
| FDIC insurance assessment |
|
14,792 |
|
|
|
14,446 |
|
|
|
7,946 |
|
|
|
47,474 |
|
|
|
27,527 |
| Amortization of other intangible
assets |
|
8,692 |
|
|
|
8,568 |
|
|
|
9,741 |
|
|
|
26,672 |
|
|
|
30,072 |
| Professional and legal fees |
|
14,118 |
|
|
|
17,938 |
|
|
|
17,109 |
|
|
|
48,521 |
|
|
|
55,329 |
| Amortization of tax credit
investments |
|
5,853 |
|
|
|
5,791 |
|
|
|
4,191 |
|
|
|
17,206 |
|
|
|
13,462 |
| Other |
|
31,249 |
|
|
|
30,484 |
|
|
|
28,859 |
|
|
|
90,752 |
|
|
|
83,824 |
|
Total non-interest expense |
|
269,471 |
|
|
|
277,497 |
|
|
|
267,133 |
|
|
|
827,278 |
|
|
|
822,270 |
| Income Before Income
Taxes |
|
126,674 |
|
|
|
93,331 |
|
|
|
194,832 |
|
|
|
349,458 |
|
|
|
589,367 |
| Income tax expense |
|
28,818 |
|
|
|
22,907 |
|
|
|
53,486 |
|
|
|
84,898 |
|
|
|
162,410 |
| Net Income |
|
97,856 |
|
|
|
70,424 |
|
|
|
141,346 |
|
|
|
264,560 |
|
|
|
426,957 |
| Dividends on preferred stock |
|
6,117 |
|
|
|
4,108 |
|
|
|
4,127 |
|
|
|
14,344 |
|
|
|
12,031 |
| Net Income Available to
Common Shareholders |
$ |
91,739 |
|
|
$ |
66,316 |
|
|
$ |
137,219 |
|
|
$ |
250,216 |
|
|
$ |
414,926 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VALLEY NATIONAL BANCORPQuarterly
Analysis of Average Assets, Liabilities and Shareholders' Equity
andNet Interest Income on a Tax Equivalent
Basis
| |
Three Months Ended |
| |
September 30, 2024 |
|
June 30, 2024 |
|
September 30, 2023 |
| |
Average |
|
|
|
Avg. |
|
Average |
|
|
|
Avg. |
|
Average |
|
|
|
Avg. |
| ($ in thousands) |
Balance |
|
Interest |
|
Rate |
|
Balance |
|
Interest |
|
Rate |
|
Balance |
|
Interest |
|
Rate |
| Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans (1)(2) |
$ |
50,126,963 |
|
$ |
786,704 |
|
|
6.28 |
% |
|
$ |
50,020,901 |
|
$ |
770,987 |
|
|
6.17 |
% |
|
$ |
50,019,414 |
|
$ |
753,662 |
|
|
6.03 |
% |
|
Taxable investments (3) |
|
5,977,211 |
|
|
55,629 |
|
|
3.72 |
|
|
|
5,379,101 |
|
|
46,801 |
|
|
3.48 |
|
|
|
4,915,778 |
|
|
37,682 |
|
|
3.07 |
|
|
Tax-exempt investments (1)(3) |
|
573,059 |
|
|
6,145 |
|
|
4.29 |
|
|
|
575,272 |
|
|
6,075 |
|
|
4.22 |
|
|
|
620,439 |
|
|
5,800 |
|
|
3.74 |
|
|
Interest bearing deposits with banks |
|
974,417 |
|
|
13,385 |
|
|
5.49 |
|
|
|
797,676 |
|
|
10,902 |
|
|
5.47 |
|
|
|
1,246,934 |
|
|
17,113 |
|
|
5.49 |
|
| Total interest earning
assets |
|
57,651,650 |
|
|
861,863 |
|
|
5.98 |
|
|
|
56,772,950 |
|
|
834,765 |
|
|
5.88 |
|
|
|
56,802,565 |
|
|
814,257 |
|
|
5.73 |
|
| Other assets |
|
4,590,372 |
|
|
|
|
|
|
4,745,689 |
|
|
|
|
|
|
4,589,123 |
|
|
|
|
| Total assets |
$ |
62,242,022 |
|
|
|
|
|
$ |
61,518,639 |
|
|
|
|
|
$ |
61,391,688 |
|
|
|
|
| Liabilities and
shareholders' equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest bearing
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings, NOW and money market deposits |
$ |
25,017,504 |
|
$ |
235,371 |
|
|
3.76 |
% |
|
$ |
24,848,266 |
|
$ |
231,597 |
|
|
3.73 |
% |
|
$ |
23,016,737 |
|
$ |
201,916 |
|
|
3.51 |
% |
|
Time deposits |
|
14,233,209 |
|
|
174,741 |
|
|
4.91 |
|
|
|
13,311,381 |
|
|
160,442 |
|
|
4.82 |
|
|
|
14,880,311 |
|
|
164,336 |
|
|
4.42 |
|
|
Short-term borrowings |
|
81,251 |
|
|
451 |
|
|
2.22 |
|
|
|
97,502 |
|
|
691 |
|
|
2.83 |
|
|
|
436,518 |
|
|
5,189 |
|
|
4.75 |
|
|
Long-term borrowings (4) |
|
3,324,992 |
|
|
39,488 |
|
|
4.75 |
|
|
|
3,319,195 |
|
|
39,051 |
|
|
4.71 |
|
|
|
2,495,512 |
|
|
29,159 |
|
|
4.67 |
|
| Total interest bearing
liabilities |
|
42,656,956 |
|
|
450,051 |
|
|
4.22 |
|
|
|
41,576,344 |
|
|
431,781 |
|
|
4.15 |
|
|
|
40,829,078 |
|
|
400,600 |
|
|
3.92 |
|
| Non-interest bearing
deposits |
|
11,158,521 |
|
|
|
|
|
|
11,223,562 |
|
|
|
|
|
|
11,951,398 |
|
|
|
|
| Other liabilities |
|
1,563,990 |
|
|
|
|
|
|
1,964,752 |
|
|
|
|
|
|
2,005,426 |
|
|
|
|
| Shareholders' equity |
|
6,862,555 |
|
|
|
|
|
|
6,753,981 |
|
|
|
|
|
|
6,605,786 |
|
|
|
|
| Total liabilities and
shareholders' equity |
$ |
62,242,022 |
|
|
|
|
|
$ |
61,518,639 |
|
|
|
|
|
$ |
61,391,688 |
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net interest income/interest
rate spread (5) |
|
|
$ |
411,812 |
|
|
1.76 |
% |
|
|
|
$ |
402,984 |
|
|
1.73 |
% |
|
|
|
$ |
413,657 |
|
|
1.81 |
% |
| Tax equivalent adjustment |
|
|
|
(1,314 |
) |
|
|
|
|
|
|
(1,299 |
) |
|
|
|
|
|
|
(1,239 |
) |
|
|
| Net interest income, as
reported |
|
|
$ |
410,498 |
|
|
|
|
|
|
$ |
401,685 |
|
|
|
|
|
|
$ |
412,418 |
|
|
|
| Net interest
margin (6) |
|
|
|
|
2.85 |
|
|
|
|
|
|
2.83 |
|
|
|
|
|
|
2.90 |
|
|
Tax equivalent effect |
|
|
|
|
0.01 |
|
|
|
|
|
|
0.01 |
|
|
|
|
|
|
0.01 |
|
| Net interest margin on a fully
tax equivalent basis (6) |
|
|
|
|
2.86 |
% |
|
|
|
|
|
2.84 |
% |
|
|
|
|
|
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. |
| |
|
SHAREHOLDERS RELATIONSRequests
for copies of reports and/or other inquiries should be directed to
Tina Zarkadas, Assistant Vice President, Shareholder Relations
Specialist, Valley National Bancorp, 70 Speedwell Avenue,
Morristown, New Jersey, 07960, by telephone at (973) 305-3380, by
fax at (973) 305-1364 or by e-mail at tzarkadas@valley.com.
|
Contact: |
|
Michael D. Hagedorn |
|
|
|
Senior Executive Vice
President and |
|
|
|
Chief Financial Officer |
|
|
|
973-872-4885 |
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