Valley National Bancorp · NASDAQ:VLY
Valley National Bancorp — Investor Presentation (September 2022)
29 slides from Valley National Bancorp's investor presentation, Sep 9, 2022
Slide 1: Investor Presentation September 2022
Exhibit 99.1 I n v e s t o r P r e s e n t a t i o n S e p t e m b e r 2 0 2 2
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: Overview of Valley
Overview of Valley 3 Company Overview Strategic Pillars Ticker: VLY (Nasdaq) Relentless Strengthening Deepening Customer our Founded: 1927 Relationships Focus Communities 1 Bank Operations Headquarters : Wayne, NJ Diverse Market Presence: Valley operates over 240 retail branches and commercial banki
Slide 4: Experienced Executive Leadership
Experienced Executive Leadership 4 Ira Robbins Tom Iadanza Chairman & Chief Executive Officer President Years at Valley: 26 / Years in Banking: 26 Years at Valley: 10 / Years in Banking: 42 Mr. Iadanza has been President of Valley since 2021. He is Mr. Robbins has been CEO of Valley since 2018 and r
Slide 5: Key Investor Highlights
Key Investor Highlights 5 Valley Focuses on Building Robust Relationships to Understand and Service the Diverse Financial Needs of its Commercial and Retail Clients Established business model with a 95-year track record of success Conservative operating philosophy Consistent profitability since ince
Slide 6: Recent History
Recent History 6 Valley’s Conservative Organic Growth and Disciplined Acquisition Strategy Have Created a Relevant and Substantial Nationwide Commercial Bank Operating In the Country’s Most Desirable Markets 1 • Acquisition of USAmeriBancorp, Inc. ($5.1bn assets ) solidifies leading commercial prese
Slide 7: Positioned for Sustained Growth in Dynamic Markets
Positioned for Sustained Growth in Dynamic Markets 7 1 Key Demographic Metrics 2010-2022 Median Proj. HHI Population Household Growth Number of Change Income (HHI) (2022-27) Businesses Market Key Business Lines (%) ($000) (%) (000) New Jersey & C&I, Technology Banking, Domestic Private Banking, CRE,
Slide 8: Strategic Execution Drives Sustainable Growth
Strategic Execution Drives Sustainable Growth 8 Allowance for Credit Losses / Balanced Execution on Organic and Acquisitive Opportunities Total Assets ($bn) Loans (%) — 17% gross loan CAGR since 2018 $54 — 18% total deposit CAGR since 2018 1.13% $43 1.09% 1.10% $41 $37 — Recent acquisitions of The W
Slide 9: Enhancing Profitability Through Execution
Enhancing Profitability Through Execution 9 Net Income ($mm) Substantial Acceleration of Earnings Power Reported GAAP Adjusted ¹ $492.1 — 145%+ increase in adjusted earnings since 2018 (Q2 2022 $401.7 $326.9 $282.6 annualized adjusted net income) equating to approximately $473.8 $165.8 $390.6 $400mm
Slide 10: Consistent Balance of Organic and Acquired Growth
Consistent Balance of Organic and Acquired Growth 10 Gross Loans ($bn) Total CAGR: 17.1% 1 Organic CAGR: 8.5% $43.6 $34.2 $32.2 $29.7 $25.0 2018 2019 2020 2021 6/30/22 2 Loan Composition as of 6/30/2022 Non Owner-Occupied Healthcare CRE CRE 3% 25% Owner-Occupied CRE 9% CRE Multifamily 45% 17% C&I 28
Slide 11: CRE Detail as of 6/30/2022
CRE Detail as of 6/30/2022 11 Portfolio by Collateral Type Portfolio by Geography Apartment & Florida Residential 25.1% 29% New York (ex. NYC) New Jersey 10.2% Retail 20.0% Specialty & 19% Other 10% $23.5bn $23.5bn Manhattan (Other) 4.7% Manhattan Healthcare (Multifamily) 11% 5.9% Mixed Use 10% Othe
Slide 12: Asset Quality
Asset Quality 12 Allowance for Credit Losses for Loans / Total Loans Non-Accrual Loans / Total Loans 0.72% 1.13% 1.09% 1.10% 0.70% 0.62% 0.55% 0.58% 0.56% 0.35% 0.31% 2018 2019 2020 2021 6/30/22 2018 2019 2020 2021 6/30/22 Legacy VLY Combined / Reported Loan Loss Provision ($mm) Net Charge-offs ($mm
Slide 13: Track Record of Below-Peer Credit Losses
Track Record of Below-Peer Credit Losses 13 Prudent risk management and rigorous underwriting standards have helped Valley create a strong credit culture, which has allowed Valley to maintain strong credit metrics compared to peers 1 2 VLY Non-Covered NCOs / Avg. Loans Peer Median NCO / Avg. Loans 1
Slide 14: Enhanced Deposit Composition and Growth Profile
Enhanced Deposit Composition and Growth Profile 14 Deposit Balance Trends ($bn) Deposit Cost Trends (%) 43.9 Total CAGR: 18.2% ¹ 4.2 Organic CAGR: 8.7% 10% 35.6 31.9 3.7 16.1 37% 29.2 2.22% 6.7 24.5 11.7 1.60% 9.7 1.31% 1.27% 29% 7.1 9.2 54% 0.98% 6.7 1.23% 25% 0.53% 6.2 23.6 0.55% 20.3 0.85% 0.36%
Slide 15: Core Deposit Base Well-Diversified by Geography and Industry
Core Deposit Base Well-Diversified by Geography and Industry 15 Total Deposit Breakdown (as of 6/30/22) Valley has built a strong customer base on a national Specialized Deposits Traditional Deposits $11bn scale, through $33bn $44bn 24% 76% expansion into new business lines and geographic markets Tr
Slide 16: Significant Available Liquidity & Low-Risk Securities
Significant Available Liquidity & Low-Risk Securities 16 Liquidity Position & Sources (as of 6/30/22) HTM Securities Portfolio (as of 6/30/22) Liquid Cash Municipal 5% 11% FHLB Borrowing Resi MBS Capacity Obligations of 75% 28% States & Political 3% U.S. Gov. Agency FRB Discount Window 7% Availabili
Slide 17: Equity & Capital
Equity & Capital 17 TCE / TA¹ (%) Tier 1 Leverage (%) 7.98% 8.88% 7.54% 8.76% 7.47% 7.46% 8.33% 8.06% 6.45% 7.57% 2018 2019 2020 2021 6/30/22 2018 2019 2020 2021 6/30/22 CET 1 and Tier 1 RBC (%) Total RBC (%) CET1 Tier 1 RBC 10.7% 10.7% 10.2% 10.1% 9.3% 9.9% 9.5% 13.10% 9.4% 9.1% 12.64% 8.4% 11.72%
Slide 18: Investment in Our Community
Investment in Our Community 18 Social Policy Footprint Corporate Social Responsibility Commitment Residential Residential mortgage loans to low- to moderate- income Mortgages Community individuals and geographies Community 15% Development Lending Development 19% Investments Multi-family loans in low
Slide 19: Potential Environmental Lending Programs
Potential Environmental Lending Programs 19 Enhancing lending to environmentally sustainable companies in our operating markets Small Business Environmental Commercial Lending Officers Industry focus toward CRE and C&I lending Increasing focus on larger-scale renewable energy products through club d
Slide 20: Franchise Highlights
Franchise Highlights 20 • $54 billion commercial bank operating over 240 full-service branches and commercial banking offices throughout northern New Jersey, New York City, Long Island, Florida, Alabama, California and Illinois • High-performing relationship-focused institution with strong asset qua
Slide 21: Appendix
‘D> Valley Appendix
Slide 22: Historical Financial Highlights
Historical Financial Highlights 22 As of or for the 6mo As of or for the Years Ended December 31, Period Ended June 30, ($ in thousands, except for share data) 2022 2021 2020 2019 2018 2017 Summary of Operations Interest income—tax equivalent basis $ 795,503 $ 1,337,440 $ 1,387,690 $ 1,325,631 $ 1,1
Slide 23: Acquisition Track Record Supplements Consistent Organic Growth
Acquisition Track Record Supplements Consistent Organic Growth 23 1 Year Target State Assets Bank Leumi USA Strategic Rationale Added new business lines, enhancing balance sheet and 2022 Bank Leumi Le-Israel Corp. NY $8.6 billion revenue diversity to position Valley for sustainable future growth 202
Slide 24: Fee Income
Fee Income 24 Non-Interest Income ($mm) 2Q22 Non-Interest Income Composition ($mm) Adjusted ¹ Reported GAAP Other $214.5 $18.0 31% $183.0 Trust, Investment & $155.0 Swap Fees Insurance $11.1 $58.5mm $13.0 $134.1 19% 22% $182.5 Loan Servicing Gain-on-Sale of Fees $154.5 Loans, net $139.1 Service Char
Slide 25: Historical Interest Coverage & Double Leverage
Historical Interest Coverage & Double Leverage 25 (Dollars in Millions) Six Months As of or for the period ended, Ended, 12/31/2018 12/31/2019 12/31/2020 12/31/2021 6/30/2022 Double Leverage Ratio Investment in Subsidiaries $3,610 $4,672 $4,999 $5,765 $6,930 Consolidated Equity $3,350 $4,384 $4,592
Slide 26: Non-GAAP Reconciliations to GAAP Financial Measures
Non-GAAP Reconciliations to GAAP Financial Measures 26 Three Months Ended Years Ended June 30, December 31, December 31, December 31, December 31, ($ in thousands, except for share data) 2022 2021 2020 2019 2018 Adjusted net income available to common shareholders (Non-GAAP): Net income, as reported
Slide 27: Non-GAAP Reconciliations to GAAP Financial Measures
Non-GAAP Reconciliations to GAAP Financial Measures 27 Three Months Ended Years Ended June 30, December 31, December 31, December 31, December 31, ($ in thousands) 2022 2021 2020 2019 2018 Efficiency ratio (Non-GAAP): Non-interest expense, as reported (GAAP) $299,730 $691,542 $646,148 $631,555 $629,
Slide 28: Non-GAAP Reconciliations to GAAP Financial Measures
Non-GAAP Reconciliations to GAAP Financial Measures 28 As of, June 30, December 31, ($ in thousands, except for share data) 2022 2018 3.5 Year CAGR Organic Loans and Loan Growth (Non-GAAP) Total Loans, as reported (GAAP) $43,560,777 $25,035,469 17.1% Less: Fair Value of Total Loans Acquired from Ban
Slide 29: For More Information
For More Information 29 ▪ Log onto our website: www.valley.com ▪ Email requests to: tlan@valley.com ▪ Call Travis Lan in Investor Relations, at: (973) 686-5007 ▪ Write to: Valley National Bank 1455 Valley Road Wayne, New Jersey 07470 Attn: Travis Lan, FSVP – Director, Corporate Finance & Business De
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