Valley National Bancorp · NASDAQ:VLY
Valley National Bancorp — Q2 2017 Earnings Presentation
19 slides from Valley National Bancorp's earnings presentation, Jul 26, 2017
Slide 1: 2Q 2017 Earnings & Project LIFT Results
© 2017 Valley National Bank®. Member FDIC. Equal Opportunity Lender. All Rights Reserved. 2Q 2017 Earnings & Project LIFT Results 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 n
Slide 3: Valley National Bancorp 2Q 2017 Earnings Highlights
Valley National Bancorp 2Q 2017 Earnings Highlights 3
Slide 4: Key Metrics: 2Q 2017 Highlights
Net Income Q2 2017: $50.1 MM Q2 2016: $39.0 MM Diluted Earnings Per Share Q2 2017: $0.18 Q2 2016: $0.15 Net Interest Margin Q2 2017: 3.20% Q2 2016: 3.14% Return on Avg Assets Q2 2017: 0.86% Q2 2016: 0.72% Operating Efficiency1 Q2 2017: 57.6% Q2 2016: 63.8% Valley National Bancorp • 2Q 2017 Highlight
Slide 5: Financial Highlights: Margin Improvement
5 Financial Highlights Margin Improvement 2Q 2017 Highlights 3.14 3.20 3.10 3.15 3.20 Q2 2016 Q2 2017 Year over Year Loan Growth1 New Loan Originations2 • Yield on interest earning assets up 6 bps compared to the same period one year ago • New volume loan yield up 55 bps to approximately 4.03% compa
Slide 6: Operating Efficiency
Operating Efficiency Efficiency Ratio 2Q 2017 Highlights • Efficiency Ratio – Improved to 57.6% for the quarter compared to 63.8% in the same quarter one year ago1 • Net Interest Income – Increased $17.5 million year over year • Non-Interest Income – Increased $0.4 million year over year • Non-Inter
Slide 7: Credit Quality
Credit Quality 2Q 2017 Highlights • Past Due & Non Accrual Loans – Decreased 14 basis points linked quarter to 0.47% of total loans • Non-Performing Assets – Remained steady at 0.23% of total assets • Provision vs. Net Charge-offs – $3.6 million Provision for Credit Losses compared to $2.7 million i
Slide 8: Valley National Bancorp 2020 Vision
Valley National Bancorp 2020 Vision 8
Slide 9: Strategic Focus to Achieve 2020 Vision
Strategic Focus to Achieve 2020 Vision 9 66.2% 61.2% 59.6% <55.0% 2015 2016 2017 YTD Long-Term Goal Efficiency Ratio2 12% 14% 13% 15% - 20% 2015 2016 2017 YTD Long-Term Goal Non-Int Income / Total Revenue 13% 7% 6% 8% - 10% 2015 2016 2017 Annualized Long-Term Goal Loan Growth Exclusive of Whole Bank
Slide 10: Enhance Non-Interest Revenue
Enhance Non-Interest Revenue Residential Mortgage 10 Deliver Sustained Performance in Challenging Interest Rate Environments Creating a Sustainable Gain on Sale Model Refinance 91% Purchase 9% 2011 - 2016 Originations Refinance 38% Purchase 62% Q2 2017 Originations • Valley Trust • Hallmark Capital
Slide 11: Expand Customer Base
Expand Customer Base • NJ / NY Market Strategy – Increase Market Share via Expansion of Current Products • C&I Lending • Residential Mortgage Purchase Product • Florida Market Strategy – Organic Growth Opportunities • 3.0% Real GPD Growth in 2016 (1.8x Greater NYC*) – Opportunistic Acquisitions • Ga
Slide 12: Improve Operating Efficiency
Improve Operating Efficiency 12 6 7 % 6 0 % 6 9 % 6 6 % 6 7 % 6 4 % 6 5 % 6 4 % 6 0 % 5 7 % 6 2 % 5 8 % Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2014 2014 2015 2015 2015 2015 2016 2016 2016 2016 2017 2017 2017 2017 2018 2018 2018 2018 2019 2019 Branch Rationalization $19.5MM Effic
Slide 13: Valley National Bancorp Project LIFT Results
Valley National Bancorp Project LIFT Results 13
Slide 14: Project LIFT: Process
Project LIFT: Process Idea Generation • 6 Month Process • Employees – Harvest & take ownership of ground level ideas • Catalyst Team – 20 employees with varied experience – Challenge status quo & drive process • Support Units – Risk Management, Legal, Compliance, Technology, Finance, Human Resources
Slide 15: Project LIFT: Impact
Compensation 69% IT Contracts 20% Occupancy 4% Other 7% Project LIFT: Impact 15 1Recurring annual pre-tax savings after 2Q 2019, net of severance, consulting fees and implementation expenses $22MM Recurring Annual Pre-Tax Impact1 $19MM Expense Reduction Fee Income 75% Interest Income 25% $3MM Revenu
Slide 16: Valley National Bancorp Appendix
Valley National Bancorp Appendix 16
Slide 17: Operating Efficiency Calculation for efficiency ratio
Operating Efficiency Calculation for efficiency ratio Three Months Ended ($, thousands) June 30, March 31, December 31, September 30, June 30, March 31, December 31, September 30, June 30, March 31, December 31, September 30, 2017 2017 2016 2016 2016 2016 2015 2015 2015 2015 2014 2014 Total non-inte
Slide 18: Operating Efficiency Calculation for efficiency ratio (continued)
Operating Efficiency Calculation for efficiency ratio (continued) Six Months Ended Years Ended ($, thousands) June 30, December 31, December 31, 2017 2016 2015 Total non-interest expense 240,191 476,125 499,075 Less: Amortization of tax credit investment 13,056 34,744 28,032 Less: Loss on extinquish
Slide 19: For More Information
For More Information Log onto our web site: www.valleynationalbank.com E-mail requests to: tzarkadas@valleynationalbank.com Call Shareholder Relations at: (973) 305-3380 Write to: Valley National Bank 1455 Valley Road Wayne, New Jersey 07470 Attn: Tina Zarkadas, Shareholder Relations Specialist Log
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