Valley National Bancorp · NASDAQ:VLY
Valley National Bancorp — Q3 2023 Earnings Presentation
19 slides from Valley National Bancorp's earnings presentation, Oct 26, 2023
Slide 1: 3Q23 Earnings Presentation
3Q23 Earnings Presentation October 26, 2023
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation 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 abo
Slide 3: 3Q 2023 Financial Highlights
3 3Q 2023 Financial Highlights GAAP Reported Non-GAAP Adjusted 1 3Q23 2Q23 3Q22 3Q23 2Q23 3Q22 Net Income ($mm) $141.3 $139.1 $178.1 $136.4 $147.1 $181.5 Return on Average Assets 0.92% 0.90% 1.30% 0.89% 0.95% 1.32% Annualized Efficiency Ratio (Non-GAAP) -- -- -- 56.7% 55.6% 49.8% Diluted Earnings Pe
Slide 4: Total Deposits Remain Stable
4 Total Deposits Remain Stable Deposit Balance Trends ($bn) Avg. Fed Funds vs. Deposit Costs (%) 5.43% 5.16% 4.69% $49.6 $49.9 3.82% 2.94% 2.45% 15.1 30% 1.96% 30% 14.9 1.36% 0.25% 0.15% 4Q21 4Q22 1Q23 2Q23 3Q23 12.4 11.7 24% 25% Total Deposits Average Fed Funds (Upper) Cumulative Beta (Current Cycl
Slide 5: Customer Deposit Base Diversified by Geography and Source
5 Customer Deposit Base Diversified by Geography and Source Total Deposit Breakdown ($bn, as of 9/30/23) Uninsured Deposit & Liquidity ($bn, as of 9/30/23) Specialized Deposits Cash & Available Liquidity Stands at 2.2x of Adjusted $8.7 Uninsured Deposits 1 17% $25.8 Traditional Branch $49.9bn Adjust
Slide 6: Highly Granular Deposits – 9/30/2023
6 Highly Granular Deposits – 9/30/2023 Deposits % of Total Deposits % of Total Customer Type Top 10 Commercial Industries 2 ($bn) Deposits ($bn) Deposits Commercial $17.9 36% Real Estate / Rental / Leasing $3.4 7% Consumer $17.0 34% Finance & Insurance $3.3 7% Fully FDIC-Insured Indirect $9.9 20% Fu
Slide 7: Diversified Loan Portfolio
7 Diversified Loan Portfolio Gross Loans ($bn) 9/30/2023 Loan Composition 1 YTD Non Owner-Occupied CRE Annualized +14.9% +12.6% +9.0% 25% Healthcare CRE 4% Growth: Owner-Occupied CRE CRE 9% Multifamily 18% 47% C&I 27% $49.9 $50.1 Other $48.7 26% $46.9 C&I 18% Construction 8% Residential R.E. Consume
Slide 8: CRE Detail as of 9/30/2023
8 CRE Detail as of 9/30/2023 Portfolio by Collateral Type Portfolio by Geography Retail Florida 18% Mixed Use 25.0% 11% New York (ex. NYC) 8.7% New Jersey 20.3% Apartment & Office 10% Manhattan Residential $28.0bn (Other) $28.0bn 31% Healthcare 4.0% Office Manhattan 2% (Multifamily) 5.6% Industrial
Slide 9: Granular & Diverse Office Portfolio
9 Granular & Diverse Office Portfolio CRE Portfolio Office Portfolio by Geography ($bn) Florida & Manhattan Alabama $0.3 $1.2 37% 9% $3.2bn Office $3.2bn 10% New York (ex. Manhattan) Healthcare $0.5 Office 16% 2% New Jersey $0.8 Other 25% $0.4 ~20% of Office Portfolio is Owner-Occupied. 13% Geograph
Slide 10: Net Interest Margin
10 Net Interest Margin Net Interest Income ($mm) and Margin 3.60% 3.57% 3.16% $467 $455 2.94% 2.91% $437 $421 $414 3Q22 4Q22 1Q23 2Q23 3Q23 Net Interest Income ($mm) NIM Continued improvement in yields on new and existing loans. Non-interest bearing deposit run-off has slowed. Cash and short-term bo
Slide 11: Diverse Fee Income Sources
11 Diverse Fee Income Sources Non-Interest Income ($mm) 3Q23 Adjusted Non-Interest Income ($mm) 1 $60.1 Other $58.7 $56.2 $15.8 30% $6.3 Loan Servicing $10.5 $2.7 $10.3 $1.2 5% $0.9 $11.0 $14.3 Gain-on-Sale of Wealth, Trust & $2.0 $13.0 Loans, net $52.4mm Insurance $2.0 $13.8 4% 26% $13.8 $13.2 $17.
Slide 12: Non-Interest Expense
12 Non-Interest Expense Non-Interest Expenses ($mm) 1 Efficiency Ratio Trend 1 283.0 16.2 267.1 3.5 266.8 263.6 55.6% 56.7% 2Q23 3Q23 2Q23 3Q23 Adjusted Reported Adj. Non-Interest Expenses 1 / Avg. Assets 1.85% 1.72% 1.72% 3Q22 2Q23 3Q23 1 Please refer to the Non-GAAP Disclosure Reconciliation in Ap
Slide 13: Asset Quality
13 Asset Quality Allowance for Credit Losses for Loans / Total Loans Non-Accrual Loans / Total Loans 1.10% 1.03% 0.95% 0.92% 0.92% 0.65% 0.57% 0.50% 0.51% 0.52% 9/30/2022 12/31/22 3/31/23 6/30/23 9/30/23 9/30/2022 12/31/2022 3/31/2023 6/30/2023 9/30/2023 Net Loan Charge-offs ($mm) Loan Loss Provisio
Slide 14: Equity & Capitalization
14 Equity & Capitalization Book Value and Tangible Book Value per Share 1 Equity Capitalization Level 1 $12.64 11.22% 11.14% $12.41 $12.54 10.66% 10.83% $12.23 10.12% $11.98 $8.63 7.40% 7.45% 7.40% $8.51 7.24% $8.36 6.82% $8.15 $7.87 9/30/2022 12/31/2022 3/31/2023 6/30/2023 9/30/2023 9/30/2022 12/31
Slide 15: Appendix
Appendix
Slide 16: Non-GAAP Reconciliations to GAAP Financial Measures
16 Non-GAAP Reconciliations to GAAP Financial Measures Three Months E nded September 30, June 30, September 30, ($ in thousands, except for share data) 2023 2023 2022 Adj usted net i ncome avai l abl e to common sharehol ders (Non-GAAP): Net income, as reported (GAAP) $141,346 $139,060 $178,119 Add:
Slide 17: Non-GAAP Reconciliations to GAAP Financial Measures
17 Non-GAAP Reconciliations to GAAP Financial Measures Three Months E nded September 30, June 30, September 30, ($ in thousands) 2023 2023 2022 Annual i zed return on average tangi bl e sharehol ders' equi ty (Non-GAAP): Net income, as reported (GAAP) $141,346 $139,060 $178,119 Average shareholders'
Slide 18: Non-GAAP Reconciliations to GAAP Financial Measures
18 Non-GAAP Reconciliations to GAAP Financial Measures As of September 30, June 30, March 31, December 31, September 30, ($ in thousands, except for share data) 2023 2023 2023 2022 2022 Tangi bl e book val ue per common share (Non-GAAP): Common shares outstanding 507,660,742 507,619,430 507,762,358
Slide 19: For More Information
19 For More Information ▪ Log onto our website: www.valley.com ▪ Email requests to: [email protected] ▪ Call Travis Lan in Investor Relations, at: (973) 686-5007 ▪ Log onto our website above or www.sec.gov to obtain free copies of documents filed by Valley with the SEC
Valley National Bancorp — Q3 2023 Earnings Presentation on 6ix