Valley National Bancorp · NASDAQ:VLY
Valley National Bancorp — Q4 2021 Earnings Presentation
21 slides from Valley National Bancorp's earnings presentation, Jan 27, 2022
Slide 1: 4Q21 Earnings Presentation
4 Q 2 1 E a r n i n g s P r e s e n t a t i o n J a n u a r y 2 7 , 2 0 2 2 Exhibit 99.2
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 o
Slide 3: Strong Financial Performance
3 1 Please refer to the Non-GAAP Disclosure Reconciliation on page 6 Strong Financial Performance 0.93% 0.96% 1.14% 0.98% 0.99% 1.18% 2019 2020 2021 Return on Average Assets Reported Adjusted 898.0 1,075.3 1,125.0 $898 $1,119 $1,210 2019 2020 2021 Net Interest Income ($mm) Ex PPP Reported 56.8% 49.6
Slide 4: Consistently Capitalizing on Growth Opportunities
4 Consistently Capitalizing on Growth Opportunities Since 2016: Total loans have increased by $16.9bn split approximately evenly between organic and acquired loans. Total loans have increased at a CAGR of 14.7%. Organic loans (ex PPP) have increased at a CAGR of 8.2%. 17.2 18.3 21.2 22.4 22.8 25.5 3
Slide 5: 4Q21 Financial Summary
5 4Q21 3Q21 4Q20 4Q21 3Q21 4Q20 Net Income ($mm) $115.0 $122.6 $105.4 $120.5 $124.7 $113.4 Return on Average Assets Annualized 1.08% 1.18% 1.02% 1.14% 1.20% 1.10% Return on Average Assets, ex. PPP 1 Annualized 0.98% 1.09% 0.94% 1.03% 1.11% 1.03% Efficiency Ratio 52.2% 50.9% 51.6% 49.4% 49.2% 46.7% D
Slide 6: Reported Net Interest Income and Margin
6 Reported Net Interest Income and Margin Recent loan growth and funding cost reduction efforts have contributed to strong net interest income and net interest margin performance TWB contributed approximately $3mm of NII in December PPP balances have declined to $436mm from a peak of $2.4bn in 1Q21
Slide 7: Deposits, Funding & Liquidity
7 44% 14.2 12.0 7.3 7.9 9.5 12.8 9.7 12.9 16.2 0.7 0.9 1.5 4Q19 4Q20 4Q21 CDs & Wholesale Consumer Commercial Niche Deposit Initiatives Non-interest bearing $11.7 Savings, NOW & MMA $20.3 Time $3.7 Short-term borrowings $0.7 Long-term borrowings $1.5 Other $0.4 Avg. Deposit Balance ($MM) and Rate (%
Slide 8: Loans & Loan Growth
8 Multifamily 15% Non Owner-Occupied CRE 26% Healthcare CRE 4% Owner-Occupied CRE 11% C&I 16% C&I (PPP) 1% Consumer 9% Residential R.E. 13% Construction 5% CRE 45% C&I 28% Other 27% $1.4 $1.6 $2.6 $1.9 $2.5 3.35% 3.32% 3.32% 3.37% 3.23% 3.86% 3.85% 3.87% 3.79% 3.83% 4Q20 1Q21 2Q21 3Q21 4Q21 Originat
Slide 9: 4Q21 Non-Interest Income
9 4Q21 Non-Interest Income ($mm) Lower swap income weighed on fees while less volatile “other” non-interest income lines were stable Acquisition of Dudley Ventures during the quarter contributed to investment services revenue Fee Income Other 32% Trust, Investment & Insurance 17% Loan Servicing Fees
Slide 10: Operating Expenses
10 173.1 160.2 171.9 174.9 184.5 157.3 157.5 160.5 168.5 174.8 4Q20 1Q21 2Q21 3Q21 4Q21 Reported Expenses Adjusted 5 Quarter Operating Expense Trends ($ in millions) Efficiency Ratio (%) 1 1Refer to the appendix on pages 16 – 20 regarding non-GAAP financial measures. Sums may be inconsistent due to
Slide 11: Asset Quality
11 0.58% 0.62% 0.68% 0.77% 0.70% 4Q20 1Q21 2Q21 3Q21 4Q21 Asset Quality Non-Accrual Loans / Total Loans Loan Loss Provision ($mm) Allowance for Credit Losses for Loans / Total Loans 0.99% 1.03% 1.09% 1.08% 1.09% 1.09% 1.10% 1.17% 1.17% 1.14% 1.12% 1.11% 4Q20 1Q21 2Q21 3Q21 4Q21 ACL / Loans ex. PPP N
Slide 12: Equity & Capitalization
12 Equity & Capitalization $7.25 $7.39 $7.59 $7.78 $7.94 $10.85 $10.97 $11.15 $11.32 $11.57 12/31/20 3/31/21 6/30/2021 9/30/2021 12/31/2021 TBV per share Book Value per share Book Value and Tangible Book Value per Share 1 Equity Capitalization Level 1 1 Please refer to the Non-GAAP Disclosure Reconc
Slide 13: 2022 Targets & Outlook
13 • Organic, non-PPP loan growth between 7% - 9%. (based on 2021 gross loans of $33.7 billion, ex-PPP) 2022 Organic Loan Growth (Excludes Leumi) • We anticipate net interest income growth between 5% - 7%. (from full-year 2021 of $1,210 million, includes PPP income) Net Interest Income (Excludes Leu
Slide 14: Appendix
A p p e n d i x
Slide 15: CRE Detail as of 12/31/2021
15 CRE Detail as of 12/31/2021 Portfolio by Collateral Type Apartment & Residential 25% Retail 20% Mixed Use 12% Office 11% Industrial 11% Healthcare 10% Specialty & Other 11% Portfolio by Geography Florida 27.2% New Jersey 22.1% Other 14.7% Other NYC Boroughs 13.3% Manhattan (Multifamily) 6.0% Manh
Slide 16: Non-GAAP Disclosure Reconciliation
16 Non-GAAP Disclosure Reconciliation December 31, September 30, December 31, December 31, December 31, December 31, ($ in thousands, except for share data) 2021 2021 2020 2021 2020 2019 Adjusted net income available to common shareholders: Net income, as reported $115,038 $122,580 $105,363 $473,840
Slide 17: Non-GAAP Disclosure Reconciliation (continued)
17 December 31, September 30, December 31, December 31, December 31, December 31, ($ in thousands) 2021 2021 2020 2021 2020 2019 Annualized return on average tangible shareholders' equity: Net income, as reported $115,038 $122,580 $105,363 $473,840 $390,606 $309,793 Average shareholders' equity 4,90
Slide 18: Non-GAAP Disclosure Reconciliation (continued)
18 December 31, September 30, December 31, ($ in thousands) 2021 2021 2020 Annualized return on average assets, excluding Paycheck Protection Program ("PPP"): Net income, as reported $115,038 $122,580 $105,363 Less: PPP loan income (net of tax) 12,549 12,097 12,509 Net income, excluding PPP loan inc
Slide 19: Non-GAAP Disclosure Reconciliation (continued)
19 December 31, September 30, June 30, March 31, December 31, September 30, June 30, March 31, ($ in thousands, except for share data) 2021 2021 2021 2021 2020 2020 2020 2020 Net interest income 315,301$ 301,026$ 300,907$ 292,667$ 287,920$ 283,086$ 282,559$ 265,339$ Non-interest income, as reported
Slide 20: Non-GAAP Disclosure Reconciliation (continued)
20 December 31, September 30, June 30, March 31, December 31, December 31, ($ in thousands, except for share data) 2021 2021 2021 2021 2020 2019 Tangible book value per common share: Common shares outstanding 421,437,068 407,313,664 406,083,790 405,797,538 403,858,998 403,278,390 Shareholders' equit
Slide 21: For More Information
21 ▪ 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, SVP – Director, Corporate Finance & Business Development ▪ Log onto o
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