Valley National Bancorp · NASDAQ:VLY
Valley National Bancorp — Q2 2022 Earnings Presentation
21 slides from Valley National Bancorp's earnings presentation, Jul 28, 2022
Slide 1: 2Q22 Earnings Presentation
2Q22 Earnings Presentation July 28, 2022
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: 2Q 2022 Highlights
3 2Q 2022 Highlights GAAP Reported Non-GAAP Adjusted 1 2Q22 1Q22 2Q21 2Q22 1Q22 2Q21 Net Income ($mm) $96.4 $116.7 $120.5 $165.8 $120.3 $126.6 Return on Average Assets 0.72% 1.07% 1.17% 1.25% 1.10% 1.23% Annualized Return on Average Assets, ex. PPP 1 0.71% 1.03% 1.04% 1.23% 1.06% 1.10% Annualized Ef
Slide 4: Strategic Execution Drives Sustainable Growth
4 Strategic Execution Drives Sustainable Growth 1 Total Assets ($bn) ACL / Loans (%) Balanced Execution on Organic and Acquisitive Opportunities 54 — 9% organic loan CAGR since 4Q19 (non-PPP) 37 1.13 — 8% organic deposit CAGR — Acquisitions of The Westchester Bank (~$1bn) and Bank Leumi USA 0.55 (~$
Slide 5: Enhancing Profitability Through Execution
5 Enhancing Profitability Through Execution 1 Adj. Net Income ($mm) 165.8 Substantial Acceleration of Earnings Power — 80%+ increase in adjusted earnings (exclusive of non-PCD provision) since 4Q19 equating to approximately $300mm on an 90.7 annualized basis. — Balance of organic and acquisitive eff
Slide 6: Updating Guidance for 2H22
6 Updating Guidance for 2H22 YTD 2Q22 Actual Expected 2H22 Organic Loan Growth 21% 8% - 10% (Annualized) 1 Net Interest Income $736mm ~$900mm Non-GAAP Efficiency Ratio 1 51.8% Below 50% Tax Rate 26.3% 27% - 28% 1 Refer to the appendix on pages 16 – 20 regarding non-GAAP financial measures. Sums may
Slide 7: Consistent Balance of Organic and Acquired Growth
7 Consistent Balance of Organic and Acquired Growth Gross Loans ($bn) Loan CAGR 2016 – 2Q22 $43.6 18.4% $6.4 Annualized 2Q22 Growth 10.1% Leumi: +26% $37.2 Valley: +21% $35.4 1Q22 2Q22 Valley Leumi 1 Organic Total New Loan Originations ($bn) 2Q22 Loan Composition 3, 4 Non Owner-Occupied CRE Healthca
Slide 8: Enhanced Deposit Composition and Growth Profile
8 Enhanced Deposit Composition and Growth Profile Deposit Balance Trends ($bn) Deposit Cost Trends (%) 43.9 4.2 9% 35.6 0.54% 10% 3.4 16.1 37% 0.43% 0.36% 0.36% 33% 11.9 0.32% 0.25% 0.23% 0.20% 0.19% 0.30% 54% 57% 23.6 0.21% 0.19% 20.3 0.18% 0.15% 0.14% 1Q22 2Q22 2Q21 3Q21 4Q21 1Q22 2Q22 Savings & I
Slide 9: Net Interest Margin and PPP Impact
9 Net Interest Margin and PPP Impact Reported Net Interest Income ($mm) and Margin Net Interest Income ($mm) and Margin Ex-PPP 1 NII +39% year / year NII ex-PPP +51% year / year $416 NII (ex-Leumi) +16% $420 NII ex-PPP, ex-Leumi +29% 3.42% 3.43% $311 $65 $299 3.23% $286 $276 3.18% 3.16% 3.10% 3.11%
Slide 10: Fee Income
10 Fee Income Non-Interest Income ($mm) 2Q22 Non-Interest Income Composition ($mm) Non-Interest Income +36% year / year $58.5 Other $3.6 $18.0 31% $13.0 $43.1 $39.3 Trust, $10.1 $1.0 Investment & $11.1 Swap Fees $7.0 Insurance $6.2 $11.1 $58.5mm $13.0 19% 22% $7.6 $14.0 $30.8 $19.3 $17.3 Loan Servic
Slide 11: Non-Interest Expense
11 Non-Interest Expense Non-Interest Expenses ($mm) Efficiency Ratio Trend 1 299.7 57.7 197.3 54.3% 7.5 53.2% 242.0 50.8% 51.2% 189.8 1Q22 2Q22 1Q22 2Q22 1Q22 2Q22 ex-PPP ex-PPP Adjusted Reported Operating Leverage 1 35% 28% 17% 14% Q/Q Growth 4-Year CAGR (2Q22 / 1Q22) (2Q22 / 2Q18) Adj. Revenue ex-
Slide 12: Asset Quality
12 Asset Quality Allowance for Credit Losses for Loans / Total Loans Non-Accrual Loans / Total Loans 1.13% 1.14% 0.72% 1.12% 1.11% 1.08% 1.13% 1.10% 0.68% 0.77% 0.70% 1.09% 1.09% 0.65% 0.56% 1.07% 2Q21 3Q21 4Q21 1Q22 2Q22 2Q21 3Q21 4Q21 1Q22 2Q22 ACL / Loans ex. PPP Legacy VLY Leumi Impact Net Charg
Slide 13: Equity & Capitalization
13 Equity & Capitalization Book Value and Tangible Book Value per Share 1 Equity Capitalization Level 1 $11.84 11.68% 11.70% 11.70% $11.57 $11.60 11.48% 11.40% $11.15 $11.32 7.95% 7.98% 7.96% $7.94 $7.93 7.73% $7.78 7.46% $7.59 $7.71 6/30/2021 9/30/2021 12/31/2021 3/31/2022 6/30/2022 6/30/2021 9/30/
Slide 14: Appendix
Appendix
Slide 15: CRE Detail as of 6/30/2022
15 CRE Detail as of 6/30/2022 Portfolio by Collateral Type Portfolio by Geography Apartment & Florida Residential 25.1% 29% New York (ex. NYC) 10.2% New Jersey Retail 20.0% Specialty & 19% Other 10% $23.5bn Manhattan $23.5bn (Other) 4.7% Healthcare Manhattan 11% (Multifamily) 5.9% Mixed Use 10% Othe
Slide 16: Non-GAAP Reconciliations to GAAP Financial Measures
16 Non-GAAP Reconciliations to GAAP Financial Measures Three Months Ended June 30, March 31, June 30, ($ in thousands, except for share data) 2022 2022 2021 Adjusted net income available to common shareholders (Non-GAAP): Net income, as reported (GAAP) $96,413 $116,728 $120,512 Add: Losses on exting
Slide 17: Non-GAAP Reconciliations to GAAP Financial Measures
17 Non-GAAP Reconciliations to GAAP Financial Measures Three Months Ended June 30, March 31, June 30, ($ in thousands) 2022 2022 2021 Annualized return on average tangible shareholders' equity (Non-GAAP): Net income, as reported (GAAP) $96,413 $116,728 $120,512 Average shareholders' equity 6,238,985
Slide 18: Non-GAAP Reconciliations to GAAP Financial Measures
18 Non-GAAP Reconciliations to GAAP Financial Measures Three Months Ended June 30, March 31, June 30, ($ in thousands) 2022 2022 2021 Annualized return on average assets, excluding Paycheck Protection Program ("PPP") (Non-GAAP): Net income, as reported (GAAP) $96,413 $116,728 $120,512 Less: PPP loan
Slide 19: Non-GAAP Reconciliations to GAAP Financial Measures
19 Non-GAAP Reconciliations to GAAP Financial Measures Three Months Ended June 30, March 31, December 31, September 30, June 30, March 31, December 31, September 30, June 30, ($ in thousands, except for share data) 2022 2022 2021 2021 2021 2021 2020 2020 2020 Net interest income, as reported (GAAP)
Slide 20: Non-GAAP Reconciliations to GAAP Financial Measures
20 Non-GAAP Reconciliations to GAAP Financial Measures As of June 30, March 31, December 31, September 30, June 30, ($ in thousands, except for share data) 2022 2022 2021 2021 2021 Tangible book value per common share (Non-GAAP): Common shares outstanding 506,328,526 421,437,068 421,437,068 407,313,
Slide 21: For More Information
21 For More Information ▪ 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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