Valley National Bancorp · NASDAQ:VLY

Valley National Bancorp — Q2 2018 Earnings Presentation

15 slides from Valley National Bancorp's earnings presentation, Jul 26, 2018

  1. Slide 1: 2Q 2018 Earnings Presentation

    Exhibit 99.2 2Q 2018 Earnings Presentation

  2. Slide 2: Forward Looking Statements

    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 n

  3. Slide 3: 2Q18 Highlights

    2Q18 Highlights Reported Adjusted1 2Q18 1Q18 2Q17 2Q18 1Q18 2Q17 Return on 0.98% 0.57% 0.86% 1.01% 0.84% 0.86% Average Assets Efficiency Ratio 60.25% 72.44% 61.57% 57.15% 60.23% 57.58% Diluted Earnings Per $0.21 $0.12 $0.18 $0.22 $0.18 $0.18 Share  Year-over-year quarterly adjusted earnings per sha

  4. Slide 4: Loans & Loan Growth

    Loans & Loan Growth 1 Loan Portfolio by Product (2Q18) Loan Portfolio by Region C&I, 16.7% Res. Mortgage, 17.6% 28% 2 Florida Consumer, 8.5% Multi-family, $23.2 32% New York 16.3% bil Construction, 6.0% 3 New Jersey 40% Owner Occupied CRE, Non-owner Occupied CRE, 11.8% 23.1% Total Loans New loan yie

  5. Slide 5: Deposits & Funding

    Deposits & Funding Recent Deposit Trend ($ in billions) Funding Composition 6/30/18 $(0.3) bil Non-interest bearing 4.757 4.653 Time ($104) mil $10.77 Savings, NOW $6.22 & MMA 6.124 6.217 Noninterest Bearing +$93 mil $26.62bil Time 11.077 10.769 $2.10 Savings, Now & Short-term MMA ($308) mil Borrowi

  6. Slide 6: Revenues

    Revenues Net Interest Margin – Stable Trend Non-Interest Income Trends ($mil) 3.12% 3.13% 3.11% $38.1 Gain-on-Sale of Loans $32.3 7.6 Service Charges $28.8 6.8 6.7 4.8 Loan Servicing 2.0 Fees $209.1 $212.3 5.3 7.3 7.3 1.8 2.2 Trust, Investment & Insurance $166.9 7.2 7.0 2.7 BOLI 1.7 2Q 2017 1Q 2018

  7. Slide 7: Non-Interest Expense

    Non-Interest Expense Project LIFT Status & Timing1 ($ in millions) Efficiency Ratio (%)3 3Q17 15.5% 11.8% 4Q17 19.5% 13.6% $22 mil 1Q18 72.4 by the end of 2Q19 2Q18 60.3 60.2 57.2 < 51.0 Remaining 39.5% Benefit 1Q18 2Q18 1Q18 2Q18 2020 Goal Reported Reported Adjusted Adjusted 2Q18 Operating Expenses

  8. Slide 8: Asset Quality

    Asset Quality NCOs/Avg. Loans1 Nonaccruals/Loans2 Linked quarter increase 0.06% attributed to Medallion loans 0.01% 0.36% -0.02% 0.24% 0.27% 2Q17 1Q18 2Q18 2Q17 1Q18 2Q18 Taxi Medallion Update  Quarterly net charge-offs of $692 Taxi Medallion 3/31/18 6/30/18 thousand Related Reserves as a % of Tota

  9. Slide 9: Branch Transformation Update

    Branch Transformation Update  Valley is embarking 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. We are striving to achieve a more rel

  10. Slide 10: Branch Transformation Update

    Branch Transformation Update  We have identified 74 branches (out of 177) within our New Jersey & New York footprints that are operating at levels that we deem sub-optimal based on deposit balances and/or operating costs.  We expect to consolidate approximately 20 branches between now and the end

  11. Slide 11: Branch Transformation Update

    Branch Transformation Update 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 Reassessment and Remediation Reassessment and Remediation (3Q18

  12. Slide 12: Targets/Outlook

    Targets/Outlook • 8-10%, net of loan sales (previous target range was 7-9%, net of 2018 Full-year loan growth loan sales) • Modest pressure driven by funding of strong loan growth and Net Interest Margin deposit competition • We seek to achieve an adjusted efficiency ratio by 4Q18 of ≤ 54% Adjusted

  13. Slide 13: Non-GAAP Disclosure Reconciliations

    Non-GAAP Disclosure Reconciliations Three Months Ended June 30, March 31, June, 30 ($ in thousands, except for share data) 2018 2018 2017 Adjusted net income available to common shareholders: Net income, as reported $72,802 $41,965 $50,065 Add: Losses (gains) on securities transactions (net of tax)

  14. Slide 14: Non-GAAP Disclosure Reconciliations

    Non-GAAP Disclosure Reconciliations Three Months Ended June 30, March 31, June 30, ($ in thousands) 2018 2018 2017 Annualized return on average tangible shareholders' equity: Net income, as reported $72,802 $41,965 $50,065 Average shareholders' equity 3,279,616 3,289,815 2,420,848 Less: Average good

  15. Slide 15: For More Information

    For More Information  Log onto our website: www.valleynationalbank.com  Email requests to: rkraemer@valleynationalbank.com  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 - Investor Rel

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