Financial Data and Key Metrics Changes - The company reported net income of $133 million or $0.22 per diluted share, with adjusted net income of $134 million or $0.23 per share, compared to $106 million and $0.18 in the previous quarter, reflecting solid momentum in net interest income and non-interest income [5][15] - Profitability ratios, including return on average assets and return on tangible shareholders' equity, continue to trend higher and are on track to meet full year guidance [6][12] - The company expects approximately 3% loan growth for the year, with net interest income growth estimated at 8% to 10% [15] Business Line Data and Key Metrics Changes - Core deposit growth was $600 million, driven by growth in commercial non-interest bearing deposits and promotional CD offerings [16] - Commercial loan diversification has seen the C&I portfolio grow at a 19% compound annual rate since 2017, with nearly 15% growth over the last twelve months [9][12] - Non-interest income has grown at a 12% annual rate since 2017, with a significant improvement in the composition of that income [11][21] Market Data and Key Metrics Changes - The company added over 105,000 new deposit accounts, contributing to approximately 8% core deposit growth [7] - C&I loan growth was particularly robust, fueled by activity in fund finance and healthcare verticals, contributing roughly 60% of the quarter's net growth in C&I [18][48] - The CRE concentration ratio has declined to 349% from 474% at the end of 2023, surpassing year-end targets ahead of schedule [19] Company Strategy and Development Direction - The company is focused on deposit growth and funding transformation, with a significant reduction in reliance on indirect deposits [7][12] - Strategic imperatives include building durable high-quality fee income and enhancing treasury management offerings [11][12] - The company aims to close the valuation gap through continued execution of its strategy, despite recognizing a disconnect between franchise quality and share valuation [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the stability of credit quality and anticipates further normalization in credit metrics [23][36] - The company remains optimistic about the long-term growth potential in its markets, particularly in the healthcare and fund finance sectors [12][40] - Management highlighted the importance of maintaining a balance between organic growth opportunities and potential share buybacks [62] Other Important Information - The company has seen a 51 basis point reduction in average cost of deposits compared to the same period in 2024 [7] - Non-interest expenses grew modestly due to merit-based salary increases and higher incentive accruals, but the efficiency ratio improved to 55.2, the best level since Q1 2023 [22] Q&A Session Summary Question: Can you speak to the ability to maintain deposit pricing given competitive nature and growth outlook? - Management anticipates margin will increase as the year progresses, driven by asset repricing tailwinds and stability on the deposit side [29] Question: What drove the increase in past dues this quarter? - The increase in delinquencies was driven by three credits, with two already cleared and the remaining expected to be resolved soon [50] Question: How is the company adapting to the competitive landscape in the technology and software sector? - The company has built infrastructure and acquired a team to leverage opportunities in the technology sector, particularly with strong connectivity to the Israeli market [39] Question: What is the outlook for loan growth in 2026? - While specific guidance for 2026 has not been provided, management anticipates low single-digit growth in CRE and overall loan growth could be closer to 5% [74]

Financial Data and Key Metrics Changes - The company reported net income of $133 million or $0.22 per diluted share, compared to $106 million and $0.18 in the previous quarter, reflecting solid momentum in net interest income and non-interest income [4] - Adjusted net income was $134 million or $0.23 per share, up from $106 million on both reported and adjusted basis a quarter ago [4] - Profitability ratios, including return on average assets and return on tangible shareholders' equity, continue to trend higher and are on track to meet full year guidance [5] Business Line Data and Key Metrics Changes - Core deposit growth was $600 million, driven by growth in commercial non-interest bearing deposits and promotional CD offerings [14] - Non-interest income has grown at a 12% annual rate since 2017, more than double the pace of peers, with a significant improvement in the composition of that income [9][20] - C&I loan growth was particularly strong, with over $700 million growth, primarily from fund finance and healthcare verticals [50] Market Data and Key Metrics Changes - The company has added over 105,000 new deposit accounts, contributing to approximately 8% core deposit growth [6] - The geographic footprint combined with specialty verticals like healthcare and fund finance has provided flexibility and scale [8] - The CRE concentration ratio has declined to 349% from 474% at the end of 2023, surpassing year-end targets ahead of schedule [17] Company Strategy and Development Direction - The company is focused on deposit growth and funding transformation, with a deliberate investment in talent, technology, and targeted market penetration [6][10] - The strategic imperatives aim to transform Valley into a more diversified, efficient, and valuable institution, with a focus on capital markets, treasury management, and tax credit advisory offerings [10] - The company recognizes a disconnect between the quality of its franchise and the valuation of its shares, believing that continued execution of its strategy will close that gap over time [11] Management's Comments on Operating Environment and Future Outlook - Management anticipates continued net interest margin expansion driven by asset repricing and stable deposit pricing [27][28] - The outlook for loan growth is approximately 3% for the year, with net interest income growth estimates refined to a range of 8% to 10% [13] - Management expressed confidence in the credit outlook, expecting further normalization and a decline in provision and charge-offs throughout the year [22] Other Important Information - The company has grown cumulative tangible book value with dividends over 105% during the CEO's tenure, approximately 15% greater than the peer median [11] - The company remains extremely well capitalized relative to its risk profile, with ample flexibility to support strategic objectives [23] Q&A Session Summary Question: Can you speak to the ability to maintain deposit pricing given competitive nature and growth outlook? - Management anticipates margin will increase as the year progresses, driven by asset repricing and stability on the deposit side [27][28] Question: Can you provide comments about new non-accrual formation in the quarter? - The increase in delinquencies was driven by three credits, with two already cleared and the remaining expected to be resolved soon [51][52] Question: How is the competitive landscape in the technology and software sector affecting the company? - The company has built infrastructure to leverage its position in the technology sector, particularly through the acquisition of a team with strong market connections [39][40] Question: What are the expectations for loan growth in 2026? - While specific guidance for 2026 has not been provided, management anticipates low single-digit growth in CRE and overall loan growth could be closer to 5% [77]

Financial Performance - GAAP reported net income was $1332 million in 2Q25, compared to $1061 million in 1Q25 and $704 million in 2Q24[3] - Non-GAAP adjusted net income was $1344 million in 2Q25, compared to $1061 million in 1Q25 and $716 million in 2Q24[3] - Adjusted pre-provision net revenue (PPNR) increased by 5% quarter-over-quarter and 21% year-over-year[5] - Net Interest Margin (NIM) increased to 301% in 2Q25[13] - The company's efficiency ratio (Non-GAAP) was 552% in 2Q25, compared to 559% in 1Q25 and 596% in 2Q24[3] Balance Sheet Strength - The company is aiming for a Commercial Real Estate (CRE) / Total Risk-Based Capital (TRBC) ratio of less than 350% by the end of 2025[7] - The company is aiming for an Allowance for Credit Losses (ACL) / Loans ratio between 120% and 125% by the end of 2025[8] - The company is aiming for a Loans / Deposits ratio of less than 97% by the end of 2025[10] Strategic Initiatives and Guidance - The company is focused on growing core deposits, further diversifying the loan portfolio, and driving sustainable fee revenue[5] - The company expects gross loan growth of approximately 3% in 2025[21] - The company expects net interest income growth of 8%-10% in 2025, based on a 2024 figure of $1629 million[21]

Core Viewpoint - Valley National (VLY) reported quarterly earnings of $0.23 per share, exceeding the Zacks Consensus Estimate of $0.22 per share, and showing an increase from $0.13 per share a year ago, indicating a positive earnings surprise of +4.55% [1] Financial Performance - The company posted revenues of $496.28 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.62%, and up from $454.2 million year-over-year [2] - Over the last four quarters, Valley National has exceeded consensus revenue estimates three times [2] Stock Performance - Valley National shares have increased approximately 7.1% since the beginning of the year, compared to the S&P 500's gain of 8.1% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.25 on revenues of $512.58 million, and for the current fiscal year, it is $0.92 on revenues of $2.01 billion [7] - The estimate revisions trend for Valley National was mixed ahead of the earnings release, which may change following the recent report [6] Industry Context - The Banks - Northeast industry, to which Valley National belongs, is currently ranked in the top 23% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Citizens & Northern (CZNC), another bank in the same industry, is expected to report quarterly earnings of $0.47 per share, reflecting a year-over-year increase of +17.5% [9]

[Executive Summary](index=1&type=section&id=Executive%20Summary) This section provides an overview of Valley National Bancorp's financial performance and key strategic highlights from the CEO [Overall Financial Performance](index=1&type=section&id=Overall%20Financial%20Performance) Valley National Bancorp reported a significant increase in net income and adjusted net income for Q2 2025 compared to the previous quarter and prior year, driven by improved profitability metrics Overall Financial Performance | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :-------------------------------- | :------ | :------ | :------ | | Net Income (millions) | $133.2 | $106.1 | $70.4 | | Diluted EPS | $0.22 | $0.18 | $0.13 | | Adjusted Net Income (millions) | $134.4 | $106.1 | $71.6 | | Adjusted Diluted EPS | $0.23 | $0.18 | $0.13 | [CEO Commentary](index=1&type=section&id=CEO%20Commentary) CEO Ira Robbins highlighted continued balance sheet strength, commercial loan growth, and positive profitability trends, emphasizing focus on low-cost deposits and improved credit results - Continued balance sheet strength and commercial loan growth[2](index=2&type=chunk) - Profitability metrics are trending positively, consistent with expectations for improvement throughout the year[2](index=2&type=chunk) - Significant reduction in provision for loan losses on both a quarter-over-quarter and year-over-year basis, with allowance coverage ratio remaining comfortable[2](index=2&type=chunk) [Net Interest Income and Margin](index=1&type=section&id=Net%20Interest%20Income%20and%20Margin) This section analyzes the company's net interest income and net interest margin, detailing the factors influencing their changes [Net Interest Income](index=1&type=section&id=Net%20Interest%20Income) Net interest income on a tax equivalent basis increased significantly quarter-over-quarter and year-over-year, primarily driven by higher yields on new loan originations, increased average loan balances, and taxable investment purchases Net Interest Income (FTE) | Metric (FTE) | Q2 2025 (millions) | Q1 2025 (millions) | Q2 2024 (millions) | QoQ Change (millions) | YoY Change (millions) | | :------------- | :----------------- | :----------------- | :----------------- | :-------------------- | :-------------------- | | Net Interest Income | $433.7 | $421.3 | $402.9 | +$12.3 | +$30.7 | | Interest Income | $806.3 | $786.0 | $834.8 | +$20.3 | -$28.5 | | Interest Expense | $372.6 | $364.6 | $431.8 | +$8.0 | -$59.2 | - Increase in net interest income from Q1 2025 was mainly driven by higher yields on new loan originations, increases in average loans and taxable investments, and one additional day[3](index=3&type=chunk)[6](index=6&type=chunk) - Increase in total interest expense was largely due to a **$548.7 million** increase in average time deposit balances, increased cost of certain non-maturity deposits, and the additional day in Q2 2025[6](index=6&type=chunk) [Net Interest Margin](index=1&type=section&id=Net%20Interest%20Margin) The net interest margin on a tax equivalent basis improved both quarter-over-quarter and year-over-year, primarily due to a higher yield on average interest-earning assets, partially offset by a slight increase in the cost of interest-bearing liabilities Net Interest Margin (FTE) | Metric (FTE) | Q2 2025 | Q1 2025 | Q2 2024 | QoQ Change (bps) | YoY Change (bps) | | :------------- | :------ | :------ | :------ | :--------------- | :--------------- | | Net Interest Margin | 3.01% | 2.96% | 2.84% | +5 | +17 | | Yield on Avg. Interest Earning Assets | 5.60% | 5.53% | 5.88% | +7 | -28 | | Cost of Avg. Interest Bearing Liabilities | 3.56% | 3.54% | 4.15% | +2 | -59 | | Cost of Total Avg. Deposits | 2.67% | 2.65% | 3.18% | +2 | -51 | - The increase in net interest margin compared to Q1 2025 was mostly due to a **7 basis point** increase in the yield on average interest earning assets, largely caused by higher interest rates on new loan originations and higher yielding investment purchases[7](index=7&type=chunk) [Loan Portfolio](index=1&type=section&id=Loan%20Portfolio) This section examines the company's loan portfolio, including growth trends, composition, and concentration in commercial real estate [Loan Growth and Composition](index=1&type=section&id=Loan%20Growth%20and%20Composition) Total loans experienced annualized growth, primarily driven by significant increases in commercial and industrial (C&I) and automobile loans, while commercial real estate (CRE) loans saw a decrease Loan Growth and Composition | Loan Category | June 30, 2025 (millions) | March 31, 2025 (millions) | QoQ Change (millions) | Annualized Growth Rate | | :-------------- | :----------------------- | :------------------------ | :-------------------- | :--------------------- | | Total Loans | $49,391.4 | $48,657.1 | +$734.3 | 6.0% | | C&I Loans | $10,870.0 | $10,150.2 | +$719.8 | 28.4% | | Automobile Loans| $2,178.8 | $2,041.2 | +$137.6 | 27.0% | | Residential Mortgage | $5,709.9 | $5,636.4 | +$73.6 | - | | Total CRE Loans | $28,825.9 | $29,114.5 | -$288.6 | - | - C&I loan growth was largely due to a continued strategic focus on organic growth within this category[9](index=9&type=chunk) - Automobile loan increase was mainly due to high quality consumer demand generated by the indirect auto dealer network and low prepayment activity[9](index=9&type=chunk) [Commercial Real Estate (CRE) Concentration](index=1&type=section&id=Commercial%20Real%20Estate%20%28CRE%29%20Concentration) The CRE loan portfolio decreased due to normal repayments and selective origination activity, leading to a decline in the CRE loan concentration ratio Commercial Real Estate (CRE) Concentration | Metric | June 30, 2025 | March 31, 2025 | | :-------------------------------- | :------------ | :------------- | | Total CRE Loans (millions) | $28,825.9 | $29,114.5 | | CRE Loan Concentration Ratio | 349% | 353% | - The decrease in CRE loans was largely driven by runoff from repayment activity and efforts to focus new CRE loan originations on more profitable holistic banking clients[9](index=9&type=chunk) [Deposits and Other Borrowings](index=2&type=section&id=Deposits%20and%20Other%20Borrowings) This section details the trends and composition of the company's deposits and other borrowing activities, including debt redemptions [Deposit Trends and Composition](index=2&type=section&id=Deposit%20Trends%20and%20Composition) Total deposit balances increased, primarily driven by growth in time deposits and non-interest bearing deposits, partially offset by a decrease in savings, NOW, and money market accounts Deposit Trends and Composition | Deposit Category | June 30, 2025 (millions) | March 31, 2025 (millions) | QoQ Change (millions) | | :----------------- | :----------------------- | :------------------------ | :-------------------- | | Total Deposits | $50,725.2 | $49,965.8 | +$759.4 | | Time Deposits | $12,886.8 | $11,923.9 | +$962.9 | | Non-Interest Bearing | $11,746.7 | $11,628.5 | +$118.2 | | Savings, NOW, Money Market | $26,091.6 | $26,413.2 | -$321.6 | - The increase in time deposit balances was mainly driven by continued deposit inflows from new promotional retail CD offerings and additional fully-insured indirect (brokered) customer CDs[10](index=10&type=chunk) - Non-interest bearing deposit balances increased mostly due to higher commercial customer deposit inflows[10](index=10&type=chunk) [Other Borrowings and Debt Redemptions](index=2&type=section&id=Other%20Borrowings%20and%20Debt%20Redemptions) Short-term borrowings increased due to FHLB advances, while long-term borrowings remained relatively stable after the redemption of subordinated notes was offset by new long-term FHLB advances Other Borrowings and Debt Redemptions | Borrowing Type | June 30, 2025 (millions) | March 31, 2025 (millions) | QoQ Change (millions) | | :--------------- | :----------------------- | :------------------------ | :-------------------- | | Short-term Borrowings | $162.2 | $59.0 | +$103.2 | | Long-term Borrowings | $2,903.0 | $2,903.0 | Unchanged | - The company redeemed **$115 million** of 5.25 percent fixed-to-floating rate subordinated notes and repaid **$100 million** of 4.55 percent fixed rate subordinated notes, resulting in a **$922 thousand** pre-tax loss on early debt extinguishment[4](index=4&type=chunk)[11](index=11&type=chunk) [Credit Quality](index=2&type=section&id=Credit%20Quality) This section provides an analysis of the company's credit quality, including allowance for credit losses, non-performing assets, and accruing past due loans [Allowance and Provision for Credit Losses](index=2&type=section&id=Allowance%20and%20Provision%20for%20Credit%20Losses) The provision for credit losses for loans significantly decreased quarter-over-quarter and year-over-year, reflecting the impact of loan growth and charge-offs, partially offset by a decline in quantitative reserves Allowance and Provision for Credit Losses | Metric | Q2 2025 (millions) | Q1 2025 (millions) | Q2 2024 (millions) | QoQ Change (millions) | YoY Change (millions) | | :-------------------------------- | :----------------- | :----------------- | :----------------- | :-------------------- | :-------------------- | | Provision for Credit Losses for Loans | $37.8 | $62.7 | $82.1 | -$24.9 | -$44.3 | | Net Loan Charge-offs | $37.8 | $41.9 | $36.8 | -$4.1 | +$1.0 | | Allowance for Credit Losses for Loans | $594.0 | $594.1 | $532.5 | -$0.1 | +$61.5 | | ACL for Loans as % of Total Loans | 1.20% | 1.22% | 1.06% | -0.02% | +0.14% | - The Q2 2025 provision reflects the impact of loan growth mainly within the C&I loan portfolio and loan charge-offs, partially offset by a decline in quantitative reserves in certain loan categories and lower specific reserves associated with collateral dependent loans[16](index=16&type=chunk) [Non-Performing Assets (NPAs)](index=2&type=section&id=Non-Performing%20Assets%20%28NPAs%29) Total non-performing assets saw a slight increase, primarily due to a rise in non-accrual loans, particularly within CRE, partially offset by a decrease in other real estate owned (OREO) Non-Performing Assets (NPAs) | Metric | June 30, 2025 (millions) | March 31, 2025 (millions) | QoQ Change (millions) | | :-------------------------------- | :----------------------- | :------------------------ | :-------------------- | | Total NPAs | $360.8 | $356.2 | +$4.6 | | Non-Accrual Loans | $354.4 | $346.5 | +$7.9 | | Non-Accrual Loans as % of Total Loans | 0.72% | 0.71% | +0.01% | | OREO | $4.8 | $7.7 | -$2.9 | - Non-accrual loans increased mainly because of a net increase in non-performing CRE loans, partially offset by a decline in non-performing C&I loans due to full charge-offs[12](index=12&type=chunk) [Accruing Past Due Loans](index=2&type=section&id=Accruing%20Past%20Due%20Loans) Accruing past due loans increased significantly quarter-over-quarter, primarily driven by increases in the 30-59 and 60-89 days past due categories, largely due to specific CRE and construction loans, many of which were subsequently resolved in July 2025 Accruing Past Due Loans | Metric | June 30, 2025 (millions) | March 31, 2025 (millions) | QoQ Change (millions) | | :-------------------------------- | :----------------------- | :------------------------ | :-------------------- | | Total Accruing Past Due Loans | $199.2 | $51.7 | +$147.5 | | Total Accruing Past Due Loans as % of Total Loans | 0.40% | 0.11% | +0.29% | [30 to 59 Days Past Due](index=5&type=section&id=30%20to%2059%20Days%20Past%20Due) Loans 30 to 59 days past due increased substantially, largely due to one significant CRE loan and one construction loan, both of which were subsequently paid in full or resolved in July 2025 30 to 59 Days Past Due | Metric | June 30, 2025 (millions) | March 31, 2025 (millions) | QoQ Change (millions) | | :----------------------- | :----------------------- | :------------------------ | :-------------------- | | Total 30-59 Days Past Due| $123.0 | $33.4 | +$89.5 | | Key Loans Included | $39.2M CRE, $35.0M Construction | - | - | - The **$39.2 million** CRE loan 30 to 59 days past due was subsequently paid in full by the borrower in July 2025[14](index=14&type=chunk) [60 to 89 Days Past Due](index=5&type=section&id=60%20to%2089%20Days%20Past%20Due) Loans 60 to 89 days past due also increased significantly, primarily due to a large CRE loan that was subsequently modified and brought current in July 2025 60 to 89 Days Past Due | Metric | June 30, 2025 (millions) | March 31, 2025 (millions) | QoQ Change (millions) | | :----------------------- | :----------------------- | :------------------------ | :-------------------- | | Total 60-89 Days Past Due| $73.3 | $10.5 | +$62.8 | | Key Loans Included | $60.6M CRE | - | - | - The **$60.6 million** CRE loan in this category was subsequently modified and brought current to its restructured terms in July 2025[14](index=14&type=chunk) [90 or More Days Past Due](index=5&type=section&id=90%20or%20More%20Days%20Past%20Due) Loans 90 or more days past due and still accruing interest decreased, mainly due to a reduction in residential mortgage loan delinquencies 90 or More Days Past Due | Metric | June 30, 2025 (millions) | March 31, 2025 (millions) | QoQ Change (millions) | | :----------------------- | :----------------------- | :------------------------ | :-------------------- | | Total 90+ Days Past Due | $2.9 | $7.8 | -$4.8 | - All loans 90 days or more past due and still accruing interest are well-secured and in the process of collection[14](index=14&type=chunk) [Capital Adequacy](index=7&type=section&id=Capital%20Adequacy) This section assesses Valley National Bancorp's capital position, focusing on key regulatory capital ratios and their quarterly changes [Capital Ratios](index=7&type=section&id=Capital%20Ratios) Valley's capital ratios remained strong, with slight increases in Tier 1, Common Equity Tier 1, and Tier 1 Leverage ratios, while the Total Risk-Based Capital ratio saw a minor reduction due to a subordinated debt redemption Capital Ratios | Capital Ratio | June 30, 2025 | March 31, 2025 | QoQ Change (bps) | | :-------------- | :------------ | :------------- | :--------------- | | Total Risk-Based Capital | 13.67% | 13.91% | -24 | | Tier 1 Capital | 11.57% | 11.53% | +4 | | Common Equity Tier 1 Capital | 10.85% | 10.80% | +5 | | Tier 1 Leverage Capital | 9.49% | 9.41% | +8 | - The reduction in the total risk-based capital ratio reflects the early redemption of **$115 million** of 5.25 percent fixed-to-floating rate subordinated notes due in June 2030, which was previously eligible for full regulatory capital treatment[17](index=17&type=chunk) [Performance Ratios](index=3&type=section&id=Performance%20Ratios) This section evaluates the company's operational efficiency and profitability through key performance ratios [Efficiency Ratio](index=3&type=section&id=Efficiency%20Ratio) The efficiency ratio improved significantly both quarter-over-quarter and year-over-year, indicating better operational efficiency Efficiency Ratio | Metric | Q2 2025 | Q1 2025 | Q2 2024 | QoQ Change (bps) | YoY Change (bps) | | :------- | :------ | :------ | :------ | :--------------- | :--------------- | | Efficiency Ratio | 55.20% | 55.87% | 59.62% | -67 | -442 | [Return on Assets and Equity](index=3&type=section&id=Return%20on%20Assets%20and%20Equity) Annualized return on average assets (ROA), shareholders' equity (ROE), and tangible ROE all showed improvements quarter-over-quarter, reflecting enhanced profitability Return on Assets and Equity | Metric | Q2 2025 | Q1 2025 | Q2 2024 | QoQ Change (bps) | YoY Change (bps) | | :-------------------------------- | :------ | :------ | :------ | :--------------- | :--------------- | | Annualized ROA | 0.86% | 0.69% | 0.46% | +17 | +40 | | Annualized ROE | 7.08% | 5.69% | 4.17% | +139 | +291 | | Annualized Tangible ROE | 9.62% | 7.76% | 5.95% | +186 | +367 | | Adjusted Annualized ROA | 0.87% | 0.69% | 0.47% | +18 | +40 | | Adjusted Annualized ROE | 7.15% | 5.69% | 4.24% | +146 | +291 | | Adjusted Annualized Tangible ROE | 9.71% | 7.76% | 6.05% | +195 | +366 | [Company Information](index=7&type=section&id=Company%20Information) This section provides background on Valley National Bancorp, important forward-looking statement disclaimers, and investor relations contact details [About Valley National Bancorp](index=7&type=section&id=About%20Valley%20National%20Bancorp) Valley National Bank, the principal subsidiary of Valley National Bancorp, is a regional bank with approximately $63 billion in assets, operating across multiple states and committed to customer service and community growth - Valley National Bank is a regional bank with approximately **$63 billion** in assets[19](index=19&type=chunk) - Operates many convenient branch locations and commercial banking offices across New Jersey, New York, Florida, Alabama, California, and Illinois[19](index=19&type=chunk) [Forward-Looking Statements](index=7&type=section&id=Forward-Looking%20Statements) This section provides a standard disclaimer regarding forward-looking statements, outlining various risks and uncertainties that could cause actual results to differ materially from expectations, including market interest rates, macroeconomic conditions, financial sector instability, and regulatory changes - Statements are not historical facts and include expressions about management's confidence and strategies and management's expectations about business, programs, products, acquisitions, relationships, opportunities, taxation, technology, market conditions and economic expectations[20](index=20&type=chunk) - Factors that may cause actual results to differ materially include the impact of market interest rates, unfavorable macroeconomic conditions, instability within the U.S. financial sector, negative public opinion, changes in regulations, loss of lower-cost funding, and unexpected declines in commercial real estate values[20](index=20&type=chunk)[21](index=21&type=chunk)[23](index=23&type=chunk) [Investor Relations](index=7&type=section&id=Investor%20Relations) Information for investors regarding the conference call and contact details for shareholder inquiries - Valley's CEO, Ira Robbins, hosted a conference call on July 24, 2025, at 11:00 AM (ET) to discuss Q2 2025 earnings[18](index=18&type=chunk) - Shareholder inquiries and requests for reports should be directed to Tina Zarkadas, Assistant Vice President, Shareholder Relations Specialist[46](index=46&type=chunk) [Consolidated Financial Statements and Notes](index=10&type=section&id=Consolidated%20Financial%20Statements%20and%20Notes) This section presents the company's detailed consolidated financial statements, including income statements, balance sheets, and supporting notes and reconciliations [Selected Financial Data](index=10&type=section&id=Selected%20Financial%20Data) This section presents a summary of key financial data, including income statement figures, earnings per share, and core financial ratios for the three and six months ended June 30, 2025, and comparative periods Selected Financial Data | Metric | Q2 2025 | Q1 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------- | :------ | :------ | :------ | :------- | :------- | | Net Interest Income - FTE (000s) | $433,675| $421,378| $402,984| $855,052 | $797,831 | | Non-interest income (000s) | $62,604 | $58,294 | $51,213 | $120,898 | $112,628 | | Total revenue (000s) | $495,012| $478,399| $452,898| $973,411 | $907,861 | | Net income (000s) | $133,167| $106,058| $70,424 | $239,225 | $166,704 | | Diluted earnings per share | $0.22 | $0.18 | $0.13 | $0.40 | $0.31 | | Net interest margin - FTE | 3.01% | 2.96% | 2.84% | 2.99% | 2.81% | | Annualized return on average assets | 0.86% | 0.69% | 0.46% | 0.77% | 0.54% | | Efficiency ratio | 55.20% | 55.87% | 59.62% | 55.53% | 59.36% | [Balance Sheet Items](index=11&type=section&id=Balance%20Sheet%20Items) This section provides a snapshot of key balance sheet items, including assets, loans, deposits, shareholders' equity, and capital ratios, showing trends over several quarters Balance Sheet Items | Metric | June 30, 2025 (millions) | March 31, 2025 (millions) | Dec 31, 2024 (millions) | Sep 30, 2024 (millions) | June 30, 2024 (millions) | | :-------------------------------- | :----------------------- | :------------------------ | :---------------------- | :---------------------- | :----------------------- | | Assets | $62,705,358 | $61,865,655 | $62,491,691 | $62,092,332 | $62,058,974 | | Total loans | $49,391,420 | $48,657,128 | $48,799,711 | $49,355,319 | $50,311,702 | | Deposits | $50,725,284 | $49,965,844 | $50,075,857 | $50,395,966 | $50,112,177 | | Shareholders' equity | $7,575,421 | $7,499,897 | $7,435,127 | $6,972,380 | $6,737,737 | | Tangible book value per common share | $9.35 | $9.21 | $9.10 | $9.06 | $8.87 | | Total risk-based capital | 13.67% | 13.91% | 13.87% | 12.56% | 12.17% | [Allowance for Credit Losses](index=12&type=section&id=Allowance%20for%20Credit%20Losses) This table details the allowance for credit losses, including beginning and ending balances, loan charge-offs, recoveries, and the provision for credit losses, for the three and six months ended June 30, 2025, and comparative periods Allowance for Credit Losses | Metric | Q2 2025 (millions) | Q1 2025 (millions) | Q2 2024 (millions) | YTD 2025 (millions) | YTD 2024 (millions) | | :-------------------------------- | :----------------- | :----------------- | :----------------- | :------------------ | :------------------ | | Beginning balance - ACL for loans | $594,054 | $573,328 | $487,269 | $573,328 | $465,550 | | Total net charge-offs | ($37,829) | ($41,949) | ($36,839) | ($79,778) | ($60,394) | | Provision for credit losses for loans | $37,795 | $62,675 | $82,111 | $100,470 | $127,385 | | Ending balance - ACL for loans | $594,020 | $594,054 | $532,541 | $594,020 | $532,541 | | ACL for loans as % of total loans | 1.20% | 1.22% | 1.06% | 1.20% | 1.06% | [Asset Quality](index=13&type=section&id=Asset%20Quality) This section provides detailed asset quality metrics, including accruing past due loans by delinquency stage and non-accrual loans by category, offering insights into the loan portfolio's health Asset Quality | Metric | June 30, 2025 (millions) | March 31, 2025 (millions) | Dec 31, 2024 (millions) | Sep 30, 2024 (millions) | June 30, 2024 (millions) | | :-------------------------------- | :----------------------- | :------------------------ | :---------------------- | :---------------------- | :----------------------- | | Total accruing past due loans | $199,202 | $51,697 | $99,194 | $174,696 | $72,395 | | Total non-accrual loans | $354,359 | $346,451 | $359,498 | $296,319 | $303,279 | | Total non-performing assets | $360,784 | $356,219 | $373,329 | $305,102 | $312,945 | | Total non-accrual loans as a % of loans | 0.72% | 0.71% | 0.74% | 0.60% | 0.60% | | Allowance for losses on loans as a % of non-accrual loans | 163.53% | 166.89% | 155.45% | 185.05% | 171.23% | [Notes to Selected Financial Data](index=14&type=section&id=Notes%20to%20Selected%20Financial%20Data) This section provides important explanatory notes for the selected financial data, including the basis for tax equivalent presentations and the methodology for non-GAAP reconciliations - Net interest income and net interest margin are presented on a tax equivalent basis using a **21 percent** federal tax rate for comparability[33](index=33&type=chunk) - The press release contains certain supplemental financial information determined by methods other than U.S. GAAP, which management uses to analyze performance and provide useful supplemental information to investors[34](index=34&type=chunk) [Non-GAAP Reconciliations](index=14&type=section&id=Non-GAAP%20Reconciliations) Detailed reconciliations are provided for various non-GAAP financial measures, including adjusted net income, adjusted EPS, adjusted return on assets and equity, efficiency ratio, and tangible book value, to their most directly comparable GAAP measures Non-GAAP Reconciliations | Metric | Q2 2025 (millions) | Q1 2025 (millions) | Q2 2024 (millions) | YTD 2025 (millions) | YTD 2024 (millions) | | :-------------------------------- | :----------------- | :----------------- | :----------------- | :------------------ | :------------------ | | Net income, as reported (GAAP) | $133,167 | $106,058 | $70,424 | $239,225 | $166,704 | | Total non-GAAP adjustments to net income | $1,722 | $11 | $1,701 | $1,733 | $6,093 | | Net income, as adjusted (non-GAAP)| $134,415 | $106,066 | $71,643 | $240,481 | $171,091 | | Diluted earnings, as adjusted (non-GAAP) | $0.23 | $0.18 | $0.13 | $0.40 | $0.32 | | Annualized return on average tangible shareholders' equity, as adjusted (non-GAAP) | 9.71% | 7.76% | 6.05% | 8.74% | 7.25% | | Efficiency ratio (non-GAAP) | 55.20% | 55.87% | 59.62% | 55.53% | 59.36% | - Non-GAAP adjustments include loss on extinguishment of debt, FDIC special assessment, losses on available for sale and held to maturity debt securities, restructuring charges, and gain on sale of commercial premium finance lending division[36](index=36&type=chunk)[40](index=40&type=chunk) [Consolidated Statements of Financial Condition](index=16&type=section&id=Consolidated%20Statements%20of%20Financial%20Condition) This table presents the consolidated balance sheet of Valley National Bancorp as of June 30, 2025, and December 31, 2024, detailing assets, liabilities, and shareholders' equity Consolidated Statements of Financial Condition | Item | June 30, 2025 (thousands) | December 31, 2024 (thousands) | | :-------------------------------- | :------------------------ | :---------------------------- | | Total Assets | $62,705,358 | $62,491,691 | | Total Loans | $49,391,420 | $48,799,711 | | Less: Allowance for loan losses | ($579,500) | ($558,850) | | Net Loans | $48,811,920 | $48,240,861 | | Total Deposits | $50,725,284 | $50,075,857 | | Total Liabilities | $55,129,937 | $55,056,564 | | Total Shareholders' Equity | $7,575,421 | $7,435,127 | [Consolidated Statements of Income](index=17&type=section&id=Consolidated%20Statements%20of%20Income) This table provides the consolidated income statement for the three and six months ended June 30, 2025, and comparative periods, detailing interest income, interest expense, non-interest income, non-interest expense, and net income Consolidated Statements of Income | Item | Q2 2025 (thousands) | Q1 2025 (thousands) | Q2 2024 (thousands) | YTD 2025 (thousands) | YTD 2024 (thousands) | | :-------------------------------- | :------------------ | :------------------ | :------------------ | :------------------- | :------------------- | | Total interest income | $805,012 | $784,752 | $833,466 | $1,589,764 | $1,662,122 | | Total interest expense | $372,604 | $364,647 | $431,781 | $737,251 | $866,889 | | Net Interest Income | $432,408 | $420,105 | $401,685 | $852,513 | $795,233 | | Provision for credit losses for loans | $37,795 | $62,675 | $82,111 | $100,470 | $127,385 | | Total non-interest income | $62,604 | $58,294 | $51,213 | $120,898 | $112,628 | | Total non-interest expense | $284,122 | $276,618 | $277,497 | $560,740 | $557,807 | | Net Income | $133,167 | $106,058 | $70,424 | $239,225 | $166,704 | | Net Income Available to Common Shareholders | $126,219 | $99,103 | $66,316 | $225,322 | $158,477 | [Quarterly Analysis of Average Assets, Liabilities and Shareholders' Equity and Net Interest Income on a Tax Equivalent Basis](index=19&type=section&id=Quarterly%20Analysis%20of%20Average%20Assets%2C%20Liabilities%20and%20Shareholders%27%20Equity%20and%20Net%20Interest%20Income%20on%20a%20Tax%20Equivalent%20Basis) This detailed analysis provides average balances, interest income/expense, and average rates for interest-earning assets and interest-bearing liabilities, along with net interest income and margin on a tax equivalent basis for the past three quarters Quarterly Analysis of Average Assets, Liabilities and Shareholders' Equity and Net Interest Income on a Tax Equivalent Basis | Item | Q2 2025 Avg. Balance (thousands) | Q2 2025 Interest (thousands) | Q2 2025 Rate | Q1 2025 Avg. Balance (thousands) | Q1 2025 Interest (thousands) | Q1 2025 Rate | Q2 2024 Avg. Balance (thousands) | Q2 2024 Interest (thousands) | Q2 2024 Rate | | :-------------------------------- | :----------------------------- | :--------------------------- | :----------- | :----------------------------- | :--------------------------- | :----------- | :----------------------------- | :--------------------------- | :----------- | | Total interest earning assets | $57,553,624 | $806,279 | 5.60% | $56,891,691 | $786,025 | 5.53% | $56,772,950 | $834,765 | 5.88% | | Total interest bearing liabilities| $41,913,735 | $372,604 | 3.56% | $41,230,709 | $364,647 | 3.54% | $41,576,344 | $431,781 | 4.15% | | Net interest income/interest rate spread | - | $433,675 | 2.04% | - | $421,378 | 1.99% | - | $402,984 | 1.73% | | Net interest margin on a fully tax equivalent basis | - | - | 3.01% | - | - | 2.96% | - | - | 2.84% |

Core Viewpoint Valley National Bancorp reported strong financial performance for the second quarter of 2025, with significant increases in net income, net interest income, and loan growth, while also demonstrating improved credit quality metrics. Financial Performance - Net income for Q2 2025 was $133.2 million, or $0.22 per diluted common share, up from $106.1 million in Q1 2025 and $70.4 million in Q2 2024 [1] - Adjusted net income for Q2 2025 was $134.4 million, or $0.23 per diluted common share, compared to $106.1 million in Q1 2025 and $71.6 million in Q2 2024 [1] - Total revenue for Q2 2025 was $495.0 million, an increase from $478.4 million in Q1 2025 and $452.9 million in Q2 2024 [24] Net Interest Income and Margin - Net interest income on a tax-equivalent basis was $433.7 million for Q2 2025, up $12.3 million from Q1 2025 and $30.7 million from Q2 2024 [3][4] - The net interest margin increased to 3.01% in Q2 2025, up from 2.96% in Q1 2025 and 2.84% in Q2 2024 [5] Loan Portfolio - Total loans increased by $734.3 million, or 6.0% annualized, to $49.4 billion at June 30, 2025, driven by growth in commercial and industrial loans [3][6] - Commercial and industrial loans grew by $719.8 million, or 28.4% annualized, to $10.9 billion [6] - Residential mortgage loans increased by $73.6 million to $5.7 billion [8] Credit Quality - The provision for credit losses for loans was $37.8 million in Q2 2025, down from $62.7 million in Q1 2025 and $82.1 million in Q2 2024 [15] - Non-accrual loans totaled $354.4 million, or 0.72% of total loans, at June 30, 2025, slightly up from 0.71% at March 31, 2025 [11] - Total accruing past due loans increased to $199.2 million, or 0.40% of total loans, from $51.7 million, or 0.11%, at March 31, 2025 [12] Deposits - Total deposits increased by $759.4 million to $50.7 billion at June 30, 2025, primarily due to increases in time deposits and non-interest bearing deposits [9] - Non-interest bearing deposits rose by $118.2 million to $11.7 billion [9] Capital Adequacy - Total risk-based capital ratio was 13.67% at June 30, 2025, down from 13.91% at March 31, 2025, due to the early redemption of subordinated notes [16]

The consensus EPS estimate for the quarter has been revised 0.7% lower over the last 30 days to the current level. This reflects how the analysts covering the stock have collectively reevaluated their initial estimates during this timeframe. Analysts on Wall Street project that Valley National (VLY) will announce quarterly earnings of $0.22 per share in its forthcoming report, representing an increase of 69.2% year over year. Revenues are projected to reach $493.23 million, increasing 8.6% from the same qua ...

Core Viewpoint - Morgan Stanley's strategy team highlights 15 stocks with short-term catalytic potential, indicating that S&P 500 index earnings growth in Q2 may exceed expectations [1] Earnings Expectations - The market anticipates a 5% year-over-year increase in S&P 500 Q2 earnings per share and over 4% revenue growth, but actual growth may be stronger [1] - The seven major tech companies are expected to see a 14% increase in net profit, while the remaining 493 constituents may experience a 3% decline [1] - Despite analysts lowering earnings expectations from April to May, the earnings revision has rebounded from -25% to approximately 1%, suggesting Q2 earnings will likely exceed expectations, aligning with the historical average of 4%-5% [1] Recommended Stocks - **argenx SE (ARGX.US)**: undervalued R&D pipeline, target price $700 [2] - **Atlassian (TEAM.US)**: continuous revenue growth potential over 20% and expected margin expansion, target price $320 [3] - **Chewy (CHWY.US)**: benefits from marketing and product optimization, expected revenue to maintain or exceed Q1 levels, target price $50 [4] - **CVS Health (CVS.US)**: advantages from competitor store closures and growth in pharmacy benefit management, target price $80 [4] - **DraftKings (DKNG.US)**: potential earnings inflection point in Q2, with actual licensing rates offsetting tax and regulatory pressures, target price $52 [4] - **Eaton Corporation (ETN.US)**: benefits from improved profit margins in U.S. electrical business, target price $375 [5] - **Eli Lilly (LLY.US)**: core products Mounjaro and Zepbound expected to contribute $8.2 billion in revenue, exceeding expectations may lead to 2025 guidance upgrades, target price $1,135 [5] - **F5 (FFIV.US)**: positive outlook due to demand growth in cloud and load balancing products, target price $305 [6] - **NVIDIA (NVDA.US)**: strong end-user demand and accelerated shipments of rack-level products supporting supply-side growth, target price $170 [7] - **Omada Health (OMDA.US)**: operational leverage through technology empowerment and multi-disease sales, target price $25 [8] - **Southwest Airlines (LUV.US)**: potential stock rebound if internal guidance is met and baggage fee impacts are confirmed as limited, target price $38 [9] - **Valley National Bank (VLY.US)**: expected net interest income growth of 3% quarter-over-quarter, target price $11 [10] - **Western Digital (WDC.US)**: undervalued gross margin expansion prospects, target price $85 [11] Cautious Outlook - **National Storage Affiliates Trust (NSA.US)**: cautious due to expected funds from operations (FFO) per share being below market and company guidance, target price $30 [12] - **Teradyne (TER.US)**: revenue and earnings per share forecasts for FY2026 are 7% and 14% below Wall Street expectations, target price $74 [13] Summary - Overall, Morgan Stanley's recommendations combine company fundamentals, industry trends, and market sentiment, providing diversified options for investors [14]

Core Viewpoint - Wall Street anticipates a year-over-year increase in earnings for Valley National (VLY) due to higher revenues, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - The earnings report is expected on July 24, with a consensus EPS estimate of $0.22, reflecting a +69.2% year-over-year change, and revenues projected at $493.23 million, up 8.6% from the previous year [3]. Estimate Revisions - The consensus EPS estimate has been revised down by 0.65% over the last 30 days, indicating a reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model suggests that the Most Accurate Estimate for Valley National is lower than the consensus estimate, resulting in an Earnings ESP of -2.33%, indicating bearish sentiment among analysts [12]. Historical Performance - Valley National has not beaten consensus EPS estimates in the last four quarters, with the most recent quarter showing a -5.26% surprise [13][14]. Investment Considerations - Despite the negative Earnings ESP, other factors may influence stock movement, and investors should consider these alongside earnings expectations [15][17].

Company Overview - Valley National Bancorp (NASDAQ: VLY) is a regional bank with over 230 branches primarily located in densely populated states across the United States [1] - The bank offers common shares and has three different issues of preferred shares, with two of the three preferred shares being highlighted [1] Investment Focus - The company is currently focused on income investing through common shares, preferred shares, or bonds [1] - The analysis may also include broader economic discussions or special situations involving researched companies [1] Background Information - The author has a Bachelor's degree in history/political science and a Master's in Business Administration with a specialization in Finance and Economics [1] - The author has been investing since 2000 and is the CEO of an independent living retirement community in Illinois [1]