Valley National Bancorp · NASDAQ:VLY
Valley National Bancorp — Q2 2019 Earnings Presentation
16 slides from Valley National Bancorp's earnings presentation, Jul 25, 2019
Slide 1: 2Q19 Earnings Presentation
2Q19 Earnings Presentation July 25, 2019
Slide 2: Forward Looking Statements
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: failure to obtain shareholder or regulatory approval for the acquisition of Oritani Financial Corp. or to satisfy other co
Slide 3: Executing on Stated Goals
3 Executing on Stated Goals Focus on our core principles have supported profitability despite challenging market environment Maintaining above- Interest rate headwinds average loan growth 6.0% 1 0.92% materially offsetting underlying progress compared to the QoQ annualized growth industry rate com
Slide 4: 2Q 2019 Highlights
2Q 2019 Highlights 4 Reported Adjusted1 2Q19 1Q19 2Q18 2Q19 1Q19 2Q18 Return on 0.94% 1.40% 0.98% 0.96% 0.93% 1.01% Average Assets Efficiency Ratio 57.19% 45.29% 60.25% 54.58% 54.79% 57.14% Diluted Earnings Per $0.22 $0.33 $0.21 $0.23 $0.22 $0.22 Share Year-over-year quarterly adjusted earnings per
Slide 5: Revenues
Revenues 5 1 Net Interest Income and Margin Adjusted Non-Interest Income Trends ($mil) Quarterly year-over-year NII growth of 4.3% (FTE) $38.1 Gain-on-Sale of Loans 3.11% 7.6 $30.5 $29.2 Service Charges $219.9 $221.4 3.9 6.7 4.6 $212.3 5.8 Loan Servicing 2.0 Fees 5.9 2.4 2.98% 2.96% 7.3 2.4 Trust, I
Slide 6: Noninterest Expense
Noninterest Expense 6 5 Quarter Operating Expense Trends ($ in millions) Efficiency Ratio (%)1 153.7 151.7 149.9 147.8 141.7 < 51.0 57.2 143.3 142.6 54.8 54.6 142.2 2 136.9 135.8 45.3 2Q18 3Q18 4Q18 1Q19 2Q19 1Q19 2Q19 1Q19 2Q19 2020 Goal Reported Reported Adjusted Adjusted (Adjusted) Reported Expen
Slide 7: Loans & Loan Growth
Loans & Loan Growth 7 1 Loan Portfolio by Product (2Q19) 1 Linked-Quarter Annualized Loan Trends Res. Mortgage, 15.9% C&I, 18.3% Auto 4.4% Home Equity -8.9% Res. Mortgage 0.1% Multi-family, Consumer, 14.9% $25.8 10.3% Construction 20.6% bil Non-Owner Occupied CRE 6.0% Construction, 5.9% Owner-Occupi
Slide 8: Deposits & Funding
Deposits & Funding 8 Recent Deposit Trend ($ in billions)1 Total Liabilities 6/30/19 1 ($134) mil Non-interest bearing Time +$230 mil $6.3 7.1 7.3 $0.6 Savings, NOW & MMA $1.8 Noninterest Bearing 6.4 6.3 ($25) mil Time $2.4 $29.5 bil Short-term Savings, Now & $11.1 borrowings 11.4 11.1 MMA ($339) mi
Slide 9: Asset Quality
Asset Quality 9 NCOs/Avg. Loans1 Nonaccruals/Loans2 0.08% 0.05% 0.36% 0.37% 0.37% 0.01% 2Q18 1Q19 2Q19 2Q18 1Q19 2Q19 Taxi Medallion Update Taxi Medallion 3/31/19 6/30/19 Quarterly net charge-offs of $2.98 million driven primarily by taxi medallion related Related Reserves as a % of Total Exposure 2
Slide 10: Branch Transformation Update
Branch Transformation Update 10 Approximately one year ago, Valley embarked on a multi-year transformation of its retail network to create a branch infrastructure that is more reflective of current trends and adaptive to future activity within our present and prospective target markets. The goal is
Slide 11: Branch Transformation Update
Branch Transformation Update 11 Underperforming Branches All other NJ/NY Branches Deposit Mix Trend Deposit Mix Trend Note: excludes receiving branches due to closure +3.3% +8.5% +23.9% 7.00 5.82 6.01 1.12 1.07 Billions 1.20 1.03 6.00 +2.3% +21.1% +5.2% 0.87 Billions 1.00 5.00 3.61 3.70 0.80 4.00 2.
Slide 12: Branch Transformation Update
Branch Transformation Update 12 Phase 1 (2018) Phase 2 (2019) Phase 3 (2020) Identification and Beginning Renovations/Consolidation/New Renovations/Consolidation/New Implementation Opportunities Opportunities ✔ Initial Round of Consolidation (3Q18-1Q19) ✔ Reassessment and Remediation of Less Efficie
Slide 13: Targets & Outlook
Targets & Outlook 13 2019 Full-year loan growth • We are targeting net loan growth in the range of 6% to 8% (unchanged) 2019 Net Interest Income • We anticipate net interest income growth of approximately 4.5% to (range lowered) 6.5%, revised from previous range of 5% to 7% 2019 Adjusted Efficiency
Slide 14: Non-GAAP Disclosure Reconciliation
Non-GAAP Disclosure Reconciliation 14 Three Months E nded June 30, March 31, June 30, ($ in thousands, except for share data) 2019 2019 2018 Adj usted net i ncome avai l abl e to common sharehol ders: Net income, as reported $76,468 $113,330 $72,802 Less: Gain on sale leaseback transactions (net of
Slide 15: Non-GAAP Disclosure Reconciliation
Non-GAAP Disclosure Reconciliation 15 Three Months E nded Si x Months E nded June 30, March 31, June 30, June 30, ($ in thousands) 2019 2019 2018 2019 2018 Annual i zed return on average tangi bl e sharehol ders' equi ty: Net income, as reported $76,468 $113,330 $72,802 $189,798 $114,767 Average sha
Slide 16: For More Information
For More Information 16 Log onto our website: www.valley.com Email requests to: [email protected] Call Rick Kraemer in Investor Relations, at: (973) 686-4817 Write to: Valley National Bank 1455 Valley Road Wayne, New Jersey 07470 Attn: Rick Kraemer, FSVP – Director, Corporate Finance Log
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