株探米国株
英語
エドガーで原本を確認する
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 10-Q
(Mark One)
☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the Quarterly Period Ended March 31, 2025
OR
☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the transition period from                      to                     
Commission File Number 1-11277 
 Valley National Bancorp
(Exact name of registrant as specified in its charter)
New Jersey 22-2477875
(State or other jurisdiction of
Incorporation or Organization)		 (I.R.S. Employer
Identification Number)
One Penn Plaza
New York, NY 10119
(Address of principal executive office) (Zip code)
973-305-8800
(Registrant’s telephone number, including area code) 
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbols Name of exchange on which registered
Common Stock, no par value VLY The Nasdaq Stock Market LLC
Non-Cumulative Perpetual Preferred Stock, Series A, no par value VLYPP The Nasdaq Stock Market LLC
Non-Cumulative Perpetual Preferred Stock, Series B, no par value VLYPO The Nasdaq Stock Market LLC
Non-Cumulative Perpetual Preferred Stock, Series C, no par value VLYPN The Nasdaq Stock Market LLC
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files.)    Yes  ☒    No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:
Large accelerated filer ☒ Accelerated filer
☐
 Smaller reporting company
☐
Non-accelerated filer
☐
 Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. Common Stock (no par value), of which 560,341,218 shares were outstanding as of May 5, 2025.


TABLE OF CONTENTS
 
    Page
Number
PART I
Item 1.
Consolidated Statements of Financial Condition as of March 31, 2025 and December 31, 2024
Consolidated Statements of Income for the Three Months Ended March 31, 2025 and 2024
Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2025 and 2024
Item 2.
Item 3.
Item 4.
PART II
Item 1.
Item 1A.
Item 2.
Item 5.
Item 6.

1


Glossary of Defined Terms

The following terms may be used throughout this Report, including the consolidated financial statements and related notes.

Term Definition
ACL Allowance for credit losses
AFS Available for sale
ASC Accounting Standards Codification
ASU Accounting Standards Update
Bank Valley National Bank (Valley’s principal subsidiary)
Basel III
Capital rules under a global regulatory framework developed by the Basel Committee on Banking Supervision
Board Board of Directors of Valley National Bancorp
CD Certificate of deposit
CECL Current expected credit loss model
CFPB
Consumer Financial Protection Bureau
CODM Chief Operating Decision Maker
CRA Community Reinvestment Act
CRE loan concentration ratio
Total commercial real estate loans held for investment and held for sale, excluding owner occupied loans, as a percentage of total risk-based capital
Exchange Act Securities Exchange Act of 1934, as amended
Fannie Mae Federal National Mortgage Association
FDIC Federal Deposit Insurance Corporation
Federal Reserve Board of Governors of the Federal Reserve System
FRB Federal Reserve Bank
FHLB Federal Home Loan Bank
Freddie Mac Federal Home Loan Mortgage Corporation
GAAP U. S. Generally Accepted Accounting Principles
GDP Gross domestic product
Ginnie Mae Government National Mortgage Association
HTM Held to Maturity
Moody’s Moody’s Investor Services
NAV Net asset value
NPA Non-performing asset
OCC Office of the Comptroller of the Currency
OREO Other real estate owned
OTC Over-the-counter
ROATE Return on average tangible shareholders’ equity
RSU Restricted stock unit
S&P Standard & Poor's
SEC U.S. Securities and Exchange Commission
SOFR Secured Overnight Financing Rate
U.S. Treasury United States Department of the Treasury
Valley
May refer to Valley National Bancorp individually, Valley National Bancorp and its consolidated subsidiaries, or certain of Valley National Bancorp’s subsidiaries, as the context requires (interchangeable with the “Company,” “we,” “our” and “us”).
Valley's Annual Report
Valley's Annual Report on Form 10-K for the year ended December 31, 2024
2


PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
VALLEY NATIONAL BANCORP
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(in thousands, except for share data) March 31,
2025		 December 31,
2024
Assets (Unaudited)
Cash and due from banks $ 508,887  $ 411,412 
Interest bearing deposits with banks 714,810  1,478,713 
Investment securities:
Equity securities 74,425  71,513 
Available for sale debt securities 3,658,704  3,369,724 
Held to maturity debt securities (net of allowance for credit losses of $633 at March 31, 2025 and $647 at December 31, 2024)
 3,545,328  3,531,573 
Total investment securities 7,278,457  6,972,810 
Loans held for sale (includes fair value of $8,427 at March 31, 2025 and $16,931 at December 31, 2024 for loans originated for sale)
 27,377  25,681 
Loans 48,657,128  48,799,711 
Less: Allowance for loan losses (578,200) (558,850)
Net loans 48,078,928  48,240,861 
Premises and equipment, net 344,123  350,796 
Lease right of use assets 334,013  328,475 
Bank owned life insurance 733,135  731,574 
Accrued interest receivable 238,326  239,941 
Goodwill 1,868,936  1,868,936 
Other intangible assets, net 121,340  128,661 
Other assets 1,617,323  1,713,831 
Total Assets $ 61,865,655  $ 62,491,691 
Liabilities
Deposits:
Non-interest bearing $ 11,628,578  $ 11,428,674 
Interest bearing:
Savings, NOW and money market 26,413,258  26,304,639 
Time 11,924,008  12,342,544 
Total deposits 49,965,844  50,075,857 
Short-term borrowings 59,026  72,718 
Long-term borrowings 2,904,567  3,174,155 
Junior subordinated debentures issued to capital trusts 57,542  57,455 
Lease liabilities 394,334  388,303 
Accrued expenses and other liabilities 984,445  1,288,076 
Total Liabilities 54,365,758  55,056,564 
Shareholders’ Equity
Preferred stock, no par value; 50,000,000 authorized shares:
Series A (4,600,000 shares issued at March 31, 2025 and December 31, 2024)
 111,590  111,590 
Series B (4,000,000 shares issued at March 31, 2025 and December 31, 2024)
 98,101  98,101 
Series C (6,000,000 shares issued at March 31, 2025 and December 31, 2024)
 144,654  144,654 
Common stock (no par value, authorized 650,000,000 shares; issued 560,278,101 shares at March 31, 2025 and 558,786,093 shares at December 31, 2024)
 196,520  195,998 
Surplus 5,444,756  5,442,070 
Retained earnings 1,634,690  1,598,048 
Accumulated other comprehensive loss (128,252) (155,334)
Treasury stock, at cost (250,000 common shares at March 31, 2025)
 (2,162) — 
Total Shareholders’ Equity 7,499,897  7,435,127 
Total Liabilities and Shareholders’ Equity $ 61,865,655  $ 62,491,691 

See accompanying notes to consolidated financial statements.
3


VALLEY NATIONAL BANCORP
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(in thousands, except for per share data)
  Three Months Ended
March 31,
  2025 2024
Interest Income
Interest and fees on loans $ 703,609  $ 771,553 
Interest and dividends on investment securities:
Taxable 63,898  35,797 
Tax-exempt 4,702  4,796 
Dividends 5,664  6,828 
Interest on federal funds sold and other short-term investments 6,879  9,682 
Total interest income 784,752  828,656 
Interest Expense
Interest on deposits:
Savings, NOW and money market 200,221  232,506 
Time 125,069  151,065 
Interest on short-term borrowings 2,946  20,612 
Interest on long-term borrowings and junior subordinated debentures 36,411  30,925 
Total interest expense 364,647  435,108 
Net Interest Income 420,105  393,548 
(Credit) provision for credit losses for available for sale and held to maturity securities (14) (74)
Provision for credit losses for loans 62,675  45,274 
Net Interest Income After Provision for Credit Losses 357,444  348,348 
Non-Interest Income
Wealth management and trust fees 15,031  17,930 
Insurance commissions 3,402  2,251 
Capital markets 6,940  5,670 
Service charges on deposit accounts 12,726  11,249 
Gains on securities transactions, net 46  49 
Fees from loan servicing 3,215  3,188 
Gains on sales of loans, net 2,197  1,618 
Gains on sales of assets, net 43  3,694 
Bank owned life insurance 4,777  3,235 
Other 9,917  12,531 
Total non-interest income 58,294  61,415 
Non-Interest Expense
Salary and employee benefits expense 142,618  141,831 
Net occupancy expense 25,888  24,323 
Technology, furniture and equipment expense 29,896  35,462 
FDIC insurance assessment 12,867  18,236 
Amortization of other intangible assets 8,019  9,412 
Professional and legal fees 15,670  16,465 
Amortization of tax credit investments 9,320  5,562 
Other 32,340  29,019 
Total non-interest expense 276,618  280,310 
Income Before Income Taxes 139,120  129,453 
Income tax expense 33,062  33,173 
Net Income 106,058  96,280 
Dividends on preferred stock 6,955  4,119 
Net Income Available to Common Shareholders $ 99,103  $ 92,161 
Earnings Per Common Share:
Basic $ 0.18  $ 0.18 
Diluted 0.18  0.18 

See accompanying notes to consolidated financial statements.
4


VALLEY NATIONAL BANCORP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)
(in thousands)
 
  Three Months Ended
March 31,
  2025 2024
Net income $ 106,058  $ 96,280 
Other comprehensive gain (loss), net of tax:
Unrealized gains and losses on available for sale securities
Net gains (losses) arising during the period 27,212  (10,205)
Total 27,212  (10,205)
Unrealized gains and losses on derivatives (cash flow hedges)
Amounts reclassified to earnings (218) (222)
Total (218) (222)
Defined benefit pension and postretirement benefit plans
Amortization of actuarial net loss 88  35 
Total other comprehensive income (loss) 27,082  (10,392)
Total comprehensive income $ 133,140  $ 85,888 
See accompanying notes to consolidated financial statements.

5


VALLEY NATIONAL BANCORP
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)

For the Three Months Ended March 31, 2025
Common Stock Accumulated
Preferred Stock Shares Amount Surplus Retained
Earnings		 Other
Comprehensive
Loss		 Treasury
Stock		 Total
Shareholders’
Equity
  ($ in thousands)
Balance - December 31, 2024 $ 354,345  558,786  $ 195,998  $ 5,442,070  $ 1,598,048  $ (155,334) $ —  $ 7,435,127 
Net income —  —  —  —  106,058  —  —  106,058 
Other comprehensive income, net of tax —  —  —  —  —  27,082  —  27,082 
Cash dividends declared:
Preferred stock, Series A, $0.39 per share
 —  —  —  —  (1,797) —  —  (1,797)
Preferred stock, Series B, $0.52 per share
 —  —  —  —  (2,065) —  —  (2,065)
Preferred stock, Series C, $0.52 per share
 — —  — —  (3,094) —  —  (3,094)
Common stock, $0.11 per share
 —  —  —  —  (62,460) —  —  (62,460)
Effect of stock incentive plan, net
 —  1,492  522  2,686  —  —  —  3,208 
Purchase of treasury stock —  (250) —  —  —  —  (2,162) (2,162)
Balance - March 31, 2025 $ 354,345  560,028  $ 196,520  $ 5,444,756  $ 1,634,690  $ (128,252) $ (2,162) $ 7,499,897 

For the Three Months Ended March 31, 2024
Common Stock Accumulated
Preferred Stock Shares Amount Surplus Retained
Earnings		 Other
Comprehensive
Loss		 Treasury
Stock		 Total
Shareholders’
Equity
  ($ in thousands)
Balance - December 31, 2023 $ 209,691  507,710  $ 178,187  $ 4,989,989  $ 1,471,371  $ (146,456) $ (1,391) $ 6,701,391 
Net income —  —  —  —  96,280  —  —  96,280 
Other comprehensive income, net of tax —  —  —  —  —  (10,392) —  (10,392)
Cash dividends declared:
Preferred stock, Series A, $0.39 per share
 —  —  —  —  (1,797) —  —  (1,797)
Preferred stock, Series B, $0.58 per share
 —  —  —  —  (2,322) —  —  (2,322)
Common stock, $0.11 per share
 —  —  —  —  (56,794) —  —  (56,794)
Effect of stock incentive plan, net
 —  1,183  348  (966) —  —  1,391  773 
Balance - March 31, 2024
 $ 209,691  508,893  $ 178,535  $ 4,989,023  $ 1,506,738  $ (156,848) $ —  $ 6,727,139 

See accompanying notes to consolidated financial statements.
6


VALLEY NATIONAL BANCORP
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(in thousands)

  Three Months Ended
March 31,
  2025 2024
Cash flows from operating activities:
Net income $ 106,058  $ 96,280 
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization 9,892  10,794 
Stock-based compensation 6,840  8,104 
Provision for credit losses 62,661  45,200 
Net accretion of discounts and amortization of premium on securities and borrowings (1,827) (779)
Amortization of other intangible assets 8,019  9,412 
Losses on available for sale and held to maturity debt securities, net 11  7 
Proceeds from sales of loans held for sale at fair value 47,094  41,650 
Gains on sales of loans, net (2,197) (1,618)
Originations of loans held for sale (37,437) (37,581)
Gains on sales of assets, net (43) (3,694)
Net change in:
Fair value of financial instruments hedged by derivative transactions 4,693  3,540 
Trading debt securities —  (16)
Lease right of use assets (5,710) 7,123 
Cash surrender value of bank owned life insurance (4,777) (3,235)
Accrued interest receivable 1,615  (8,395)
Other assets 85,015  (184,680)
Accrued expenses and other liabilities (297,029) 117,399 
Net cash (used in) provided by operating activities (17,122) 99,511 
Cash flows from investing activities:
 Loans originated and purchased, net of principal collected 88,203  (67,432)
Equity securities:
Purchases (3,045) (957)
Sales 427  408 
Held to maturity debt securities:
Purchases (89,352) (39,639)
Maturities, calls and principal repayments 75,678  67,777 
Available for sale debt securities:
Purchases (341,315) (183,924)
Maturities, calls and principal repayments 91,660  18,338 
Death benefit proceeds from bank owned life insurance 3,226  3,620 
Proceeds from sales of real estate property and equipment 2,255  2,850 
Proceeds from sales of loans not originated for sale —  196,523 
Proceeds from sale of commercial premium finance lending division —  98,060 
Purchases of real estate property and equipment (3,047) (3,639)
Net cash (used in) provided by investing activities (175,310) 91,985 
7


VALLEY NATIONAL BANCORP
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (continued)
(in thousands)
  Three Months Ended
March 31,
  2025 2024
Cash flows from financing activities:
Net change in deposits $ (111,529) $ (164,883)
Net change in short-term borrowings (13,692) (842,610)
Proceeds from issuance of long-term borrowings, net —  1,000,000 
Repayments of long-term borrowings (273,000) (65,000)
Cash dividends paid to preferred shareholders (6,956) (4,119)
Cash dividends paid to common shareholders (62,930) (57,944)
Purchase of common shares related to stock compensation plan activity (7,037) (7,381)
Purchase of common shares to treasury (2,162) — 
Common stock issued, net 3,405  51 
Other, net (95) (2)
Net cash used in financing activities (473,996) (141,888)
Net change in cash and cash equivalents (666,428) 49,608 
Cash and cash equivalents at beginning of year 1,890,125  891,225 
Cash and cash equivalents at end of period $ 1,223,697  $ 940,833 
Supplemental disclosures of cash flow information:
Cash payments for:
Interest on deposits and borrowings $ 403,276  $ 485,127 
Federal and state income taxes 13,044  6,487 
Supplemental schedule of non-cash investing activities:
Transfer of loans to other real estate owned, net $ 694  $ — 
Transfer of loans to loans held for sale, net 10,200  34,143 
Lease right of use assets obtained in exchange for operating lease liabilities 14,886  4,809 

See accompanying notes to consolidated financial statements.
8


VALLEY NATIONAL BANCORP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1. Basis of Presentation
The unaudited consolidated financial statements of Valley include the accounts of the Bank and all other entities in which Valley has a controlling financial interest. All intercompany transactions and balances have been eliminated. The accounting and reporting policies of Valley conform to GAAP and general practices within the financial services industry. In accordance with GAAP, Valley does not consolidate statutory trusts established for the sole purpose of issuing trust preferred securities and related trust common securities. Certain prior period amounts have been reclassified to conform to the current presentation.
In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly Valley’s financial position, results of operations, changes in shareholders' equity and cash flows at March 31, 2025 and for all periods presented have been made. The results of operations for the three months ended March 31, 2025 are not necessarily indicative of the results to be expected for the entire fiscal year or any subsequent interim period.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP and industry practice have been condensed or omitted pursuant to rules and regulations of the SEC. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in Valley’s Annual Report.
Significant Estimates. In preparing the unaudited consolidated financial statements in conformity with GAAP, management has made estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated statements of financial condition and results of operations for the periods indicated. Material estimates that require application of management’s most difficult, subjective or complex judgment and are particularly susceptible to change include: the allowance for credit losses, the evaluation of goodwill and other intangible assets for impairment, and income taxes. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the consolidated financial statements in the period they are deemed necessary. While management uses its best judgment, actual amounts or results could differ significantly from those estimates. The recent economic environment has increased and may continue to increase the degree of uncertainty inherent in these material estimates. Actual results may differ from those estimates. Also, future amounts and values could differ materially from those estimates due to changes in values and circumstances after the balance sheet date.
Note 2. Earnings Per Common Share
The following table shows the calculation of both basic and diluted earnings per common share for the three months ended March 31, 2025 and 2024:
  Three Months Ended
March 31,
  2025 2024
  (in thousands, except for share and per share data)
Net income available to common shareholders $ 99,103  $ 92,161 
Basic weighted average number of common shares outstanding
 559,613,272  508,340,719 
Plus: Common stock equivalents 3,692,253  2,293,226 
Diluted weighted average number of common shares outstanding
 563,305,525  510,633,945 
Earnings per common share:
Basic $ 0.18  $ 0.18 
Diluted 0.18  0.18 
9


Common stock equivalents represent the dilutive effect of additional common shares issuable upon the assumed vesting or exercise, if applicable, of RSUs and common stock options to purchase Valley’s common shares. Common stock options and RSUs with exercise and vesting prices that exceed the average market price of Valley’s common stock during the periods presented may have an anti-dilutive effect on the diluted earnings per common share calculation and therefore are excluded from the diluted earnings per share calculation. Potential anti-dilutive weighted common shares totaled approximately 638 thousand and 1.3 million for the three months ended March 31, 2025 and 2024, respectively.
Note 3. Accumulated Other Comprehensive Loss
The following tables present the after-tax changes in the balances of each component of accumulated other comprehensive loss for the three months ended March 31, 2025 and 2024:
Components of Accumulated Other Comprehensive Loss Total
Accumulated
Other
Comprehensive
Loss
Unrealized Gains
and Losses on
AFS Securities		 Unrealized Gains
and Losses on
Derivatives		 Defined Benefit
Pension and Postretirement Benefit Plans
(in thousands)
December 31, 2024 $ (133,898) $ 1,245  $ (22,681) $ (155,334)
Other comprehensive income before reclassification 27,212  —  —  27,212 
Amounts reclassified to earnings —  (218) 88  (130)
Other comprehensive income (loss), net 27,212  (218) 88  27,082 
March 31, 2025 $ (106,686) $ 1,027  $ (22,593) $ (128,252)
December 31, 2023 $ (115,502) $ 2,114  $ (33,068) $ (146,456)
Other comprehensive loss before reclassification (10,205) —  —  (10,205)
Amounts reclassified to earnings —  (222) 35  (187)
Other comprehensive (loss) income, net (10,205) (222) 35  (10,392)
March 31, 2024 $ (125,707) $ 1,892  $ (33,033) $ (156,848)
The following table presents amounts reclassified from each component of accumulated other comprehensive loss on a gross and net of tax basis for the three months ended March 31, 2025 and 2024:
Amounts Reclassified from
Accumulated Other Comprehensive Loss
Three Months Ended
March 31,
Components of Accumulated Other Comprehensive Loss 2025 2024 Income Statement Line Item
  (in thousands)  
Unrealized gains on derivatives (cash flow hedges) before tax $ 301  $ 298  Included in interest income.
Tax effect (83) (76)
Total net of tax 218  222 
Defined benefit pension and postretirement benefit plans:
Amortization of actuarial net loss (121) (49) Included in the computation of net periodic pension cost recognized within other non-interest expense.
Tax effect 33  14 
Total net of tax (88) (35)
Total reclassifications, net of tax $ 130  $ 187 
10


Note 4. New Authoritative Accounting Guidance
ASU No. 2024-03, "Income Statement—Reporting Comprehensive Income Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses," requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. ASU No. 2024-03 does not change the expense captions an entity presents on the face of the income statement. Subsequently issued ASU No. 2025-01 amended the effective date of ASU No. 2024-03 to require all public business entities to adopt the new guidance for annual reporting periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption and retrospective application are permitted. Valley is currently evaluating the impact of ASU No. 2024-03 on its consolidated financial statements.
Note 5. Fair Value Measurement of Assets and Liabilities
ASC Topic 820, "Fair Value Measurement," establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below:

•Level 1    - Unadjusted exchange quoted prices in active markets for identical assets or liabilities, or identical liabilities traded as assets that the reporting entity has the ability to access at the measurement date.
•Level 2 - Quoted prices in markets that are not active, or inputs that are observable either directly or indirectly (i.e., quoted prices on similar assets) for substantially the full term of the asset or liability.
•Level 3 - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).
Assets and Liabilities Measured at Fair Value on a Recurring and Non-Recurring Basis
The following tables present the assets and liabilities that are measured at fair value on a recurring and non-recurring basis by level within the fair value hierarchy as reported on the consolidated statements of financial condition at March 31, 2025 and December 31, 2024. The assets presented under “non-recurring fair value measurements” in the tables below are not measured at fair value on an ongoing basis but are subject to fair value adjustments under certain circumstances (e.g., when an impairment loss is recognized). 
11


  March 31,
2025		 Fair Value Measurements at Reporting Date Using:
  Quoted Prices
in Active Markets
for Identical
Assets (Level 1)		 Significant
Other
Observable Inputs
(Level 2)		 Significant
Unobservable
Inputs
(Level 3)
  (in thousands)
Recurring fair value measurements:
Assets
Investment securities:
Equity securities $ 23,545  $ 23,545  $ —  $ — 
Equity securities at net asset value (NAV)
 10,870  —  —  — 
Available for sale debt securities:
U.S. Treasury securities 296,253  296,253  —  — 
U.S. government agency securities 22,400  —  22,400  — 
Obligations of states and political subdivisions 187,381  —  187,381  — 
Residential mortgage-backed securities 2,967,535  —  2,967,535  — 
Corporate and other debt securities 185,135  —  185,135  — 
Total available for sale debt securities 3,658,704  296,253  3,362,451  — 
Loans held for sale (1)
 8,427  —  8,427  — 
Other assets (2)
 326,722  —  326,722  — 
Total assets $ 4,028,268  $ 319,798  $ 3,697,600  $ — 
Liabilities
Other liabilities (2)
 $ 332,888  $ —  $ 332,888  $ — 
Total liabilities $ 332,888  $ —  $ 332,888  $ — 
Non-recurring fair value measurements:
Non-performing loans held for sale (3)
$ 18,950  $ —  $ 18,950  $ — 
Collateral dependent loans 81,473  —  —  81,473 
Foreclosed assets (3)
9,768  —  —  9,768 
Total $ 110,191  $ —  $ 18,950  $ 91,241 
12


    Fair Value Measurements at Reporting Date Using:
  December 31,
2024		 Quoted Prices
in Active Markets
for Identical
Assets (Level 1)		 Significant
Other
Observable Inputs
(Level 2)		 Significant
Unobservable
Inputs
(Level 3)
  (in thousands)
Recurring fair value measurements:
Assets
Investment securities:
Equity securities $ 23,642  $ 23,642  $ —  $ — 
Equity securities at net asset value (NAV)
 11,000  —  —  — 
Available for sale debt securities:
U.S. Treasury securities 291,549  291,549  —  — 
U.S. government agency securities 22,543  —  22,543  — 
Obligations of states and political subdivisions 192,509  —  192,509  — 
Residential mortgage-backed securities 2,681,076  —  2,681,076  — 
Corporate and other debt securities 182,047  —  182,047  — 
Total available for sale debt securities 3,369,724  291,549  3,078,175  — 
Loans held for sale (1)
 16,931  —  16,931  — 
Other assets (2)
 444,263  —  444,263  — 
Total assets $ 3,865,560  $ 315,191  $ 3,539,369  $ — 
Liabilities
Other liabilities (2)
 $ 454,200  $ —  $ 454,200  $ — 
Total liabilities $ 454,200  $ —  $ 454,200  $ — 
Non-recurring fair value measurements:
Non-performing loan held for sale (3)
$ 8,750  $ —  $ 8,750  $ — 
Collateral dependent loans 139,424  —  —  139,424 
Foreclosed assets (3)
13,852  —  —  13,852 
Total $ 162,026  $ —  $ 8,750  $ 153,276 
(1)Represents residential mortgage originated for sale that are carried at fair value and had contractual unpaid principal balances totaling $8.3 million and $16.8 million at March 31, 2025 and December 31, 2024, respectively.
(2)Derivative financial instruments are included in this category.
(3)Reported at lower of cost or fair value.

Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following valuation techniques were used for financial instruments measured at fair value on a recurring basis. All the valuation techniques described below apply to the unpaid principal balance, excluding any accrued interest or dividends at the measurement date. Interest income and expense are recorded within the consolidated statements of income depending on the nature of the instrument using the effective interest method based on acquired discount or premium.
Equity securities. The equity securities consisted of two publicly traded mutual funds, CRA investments and a publicly traded financial technology company. These investments are reported at fair value utilizing Level 1 inputs.
Equity securities at NAV. Valley also has privately held CRA funds and investments in limited liability companies and partnerships at fair value measured at NAV using the most recently available financial information from the investee. Certain equity investments without readily determinable fair values, excluded from fair value hierarchy levels in the table above, are measured at NAV per share (or its equivalent) as a practical expedient.
13


Available for sale debt securities. U.S. Treasury securities are reported at fair value utilizing Level 1 inputs. The majority of other investment securities are reported at fair value utilizing Level 2 inputs. The prices for these instruments are obtained through an independent pricing service or dealer market participants with whom Valley has historically transacted both purchases and sales of investment securities. Prices obtained from these sources include prices derived from market quotations and matrix pricing. The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the bond’s terms and conditions, among other things. Management reviews the data and assumptions used in pricing the securities by its third-party provider to ensure the highest level of significant inputs are derived from market observable data. In addition, Valley reviews the volume and level of activity for all AFS debt securities and attempts to identify transactions which may not be orderly or reflective of a significant level of activity and volume.
Loans held for sale. Residential mortgage loans originated for sale are reported at fair value using Level 2 inputs. The fair values were calculated utilizing quoted prices for similar assets in active markets. The market prices represent a delivery price, which reflects the underlying price each institution would pay Valley for an immediate sale of an aggregate pool of mortgages. Non-performance risk did not materially impact the fair value of mortgage loans held for sale at March 31, 2025 and December 31, 2024 based on the short duration these assets were held and their credit quality.
Derivatives. Derivatives are reported at fair value utilizing Level 2 inputs. The fair values of Valley’s derivatives are determined using third-party prices that are based on discounted cash flow analysis using observed market inputs, such as the SOFR curve, at March 31, 2025 and December 31, 2024. The fair value of mortgage banking derivatives, consisting of interest rate lock commitments to fund residential mortgage loans and forward commitments for the future delivery of such loans (including certain loans held for sale at March 31, 2025 and December 31, 2024), is determined based on the current market prices for similar instruments. The fair value of a credit default swap related to a portion of Valley's automobile loan portfolio is based on estimated discounted cash flows that incorporate market data for auto credit loss forecasts and anticipated cash outflows for the instrument's premium payments. The fair value of most of the derivatives incorporate credit valuation adjustments, which consider the impact of any credit enhancements to the contracts, to account for potential nonperformance risk of Valley and its counterparties. The credit valuation adjustments were not significant to the overall valuation of Valley’s derivatives at March 31, 2025 and December 31, 2024. See Note 12 for additional details on Valley's derivatives.
Assets and Liabilities Measured at Fair Value on a Non-recurring Basis
The following valuation techniques were used for certain non-financial assets measured at fair value on a non-recurring basis, including collateral dependent loans reported at the fair value of the underlying collateral and foreclosed assets, which are reported at fair value upon initial recognition or subsequent impairment as described below.
Non-performing commercial real estate loans held for sale. During 2023, Valley transferred a non-performing construction loan totaling $10.0 million, net of $4.2 million charge-offs, to the allowance for loan losses, to loans held for sale. The fair value of the loan was determined using Level 2 inputs, including bids from a third-party broker engaged to solicit interest from potential purchasers. The broker coordinated loan level due diligence with interested parties and established a bidding process in which each participant was required to provide an indicative non-binding bid. Fair value was determined based on a non-binding sale agreement selected by Valley in the bidding process. During 2024, an additional $1.2 million write-down was recorded to earnings to reflect the loan's current estimated fair value of $8.8 million at December 31, 2024 and March 31, 2025.
During the three months ended March 31, 2025, Valley transferred a non-performing construction loan totaling $10.2 million, net of $638 thousand charge-offs to the allowance for loan losses, to loans held for sale. The fair value of the loan was determined using Level 2 inputs, including bids to purchase from multiple third-parties. Fair value was determined based on a non-binding sale agreement selected by Valley in the bidding process.
14


Collateral dependent loans. Collateral dependent loans are loans where foreclosure of the collateral is probable, or where the borrower is experiencing financial difficulty and substantially all the repayment is expected from the sale of collateral. Collateral dependent loans are reported at the fair value of the underlying collateral when the fair value is lower than the recorded investment in the loan. Collateral values are estimated using Level 3 inputs, consisting of individual third-party appraisals that may be adjusted based on certain discounting criteria. Certain real estate appraisals may be discounted based on specific market data by location and property type. At March 31, 2025, collateral dependent loans were individually re-measured and reported at fair value through direct loan charge-offs to the allowance for loan losses based on the fair value of the underlying collateral. Collateral dependent loans with a total amortized cost of $142.9 million, (including taxi medallion loans totaling $49.2 million), were reduced by specific allowance for loan losses allocations totaling $61.4 million to a reported total net carrying amount of $81.5 million at March 31, 2025.
Foreclosed assets. Certain foreclosed assets (consisting of other real estate owned and other repossessed assets included in other assets), upon initial recognition and transfer from loans, are re-measured and reported at fair value using Level 3 inputs, consisting of a third-party appraisal less estimated cost to sell. When an asset is acquired, the excess of the loan balance over fair value, less estimated selling costs, is charged to the allowance for loan losses. If further declines in the estimated fair value of an asset occur, the asset is re-measured and reported at fair value through a write-down recorded in non-interest expense. There were no adjustments to the appraisals of foreclosed assets at March 31, 2025 and December 31, 2024.
Other Fair Value Disclosures
ASC Topic 825, “Financial Instruments,” requires disclosure of the fair value of financial assets and financial liabilities, including those financial assets and financial liabilities that are not measured and reported at fair value on a recurring basis or non-recurring basis.
The fair value estimates presented in the following table were based on pertinent market data and relevant information on the financial instruments available as of the valuation date. These estimates do not reflect any premium or discount that could result from offering for sale at one time the entire portfolio of financial instruments. Because no market exists for a portion of the financial instruments, fair value estimates may be based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates.
Fair value estimates are based on existing balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. For instance, Valley has certain fee-generating business lines (e.g., its mortgage servicing operations or Wealth Management reporting unit) that were not considered in these estimates since these activities are not financial instruments. In addition, the tax implications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in any of the estimates.
15


The carrying amounts and estimated fair values of financial instruments not measured and not reported at fair value on the consolidated statements of financial condition at March 31, 2025 and December 31, 2024 were as follows: 
  Fair Value
Hierarchy		 March 31, 2025 December 31, 2024
  Carrying
Amount		 Fair Value Carrying
Amount		 Fair Value
  (in thousands)
Financial assets
Cash and due from banks Level 1 $ 508,887  $ 508,887  $ 411,412  $ 411,412 
Interest bearing deposits with banks Level 1 714,810  714,810  1,478,713  1,478,713 
Equity securities (1)
 Level 3 40,010  40,010  36,871  36,871 
Held to maturity debt securities:
U.S. Treasury securities Level 1 25,290  25,269  25,480  25,461 
U.S. government agency securities Level 2 300,865  259,872  301,315  252,302 
Obligations of states and political subdivisions Level 2 358,186  329,121  372,489  346,361 
Residential mortgage-backed securities Level 2 2,742,355  2,373,276  2,710,642  2,292,148 
Trust preferred securities Level 2 36,086  29,480  36,081  29,145 
Corporate and other debt securities Level 2 83,179  80,616  86,213  82,867 
Total held to maturity debt securities (2)
 3,545,961  3,097,634  3,532,220  3,028,284 
Net loans 
 Level 3 48,078,928  46,833,553  48,240,861  46,634,654 
Accrued interest receivable Level 1 238,326  238,326  239,941  239,941 
FRB and FHLB stock (3)
 Level 2 329,602  329,602  328,497  328,497 
Financial liabilities
Deposits without stated maturities Level 1 38,041,836  38,041,836  37,733,313  37,733,313 
Deposits with stated maturities Level 2 11,924,008  11,953,730  12,342,544  12,363,365 
Short-term borrowings Level 2 59,026  56,112  72,718  68,032 
Long-term borrowings Level 2 2,904,567  2,863,577  3,174,155  3,109,622 
Junior subordinated debentures issued to capital trusts
 Level 2 57,542  55,163  57,455  54,957 
Accrued interest payable (4)
 Level 1 111,934  111,934  150,564  150,564 
(1)Represents equity securities without a readily determinable fair value, which are measured based on the price at which the investment was acquired plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments. Total changes in the valuation of equity securities for the three months ended March 31, 2025 and for the year ended December 31, 2024, respectively, were immaterial.
(2)The carrying amount is presented gross without the allowance for credit losses.
(3)Included in other assets.
(4)Included in accrued expenses and other liabilities.
Note 6. Investment Securities
Equity Securities
Equity securities totaled $74.4 million and $71.5 million at March 31, 2025 and December 31, 2024, respectively. See Note 5 for further details on equity securities.
16


Available for Sale Debt Securities
The amortized cost, gross unrealized gains and losses and fair value of AFS debt securities at March 31, 2025 and December 31, 2024 were as follows: 
Amortized
Cost		 Gross
Unrealized
Gains		 Gross
Unrealized
Losses		 Fair Value
  (in thousands)
March 31, 2025
U.S. Treasury securities $ 321,009  $ —  $ (24,756) $ 296,253 
U.S. government agency securities 23,850  22  (1,472) 22,400 
Obligations of states and political subdivisions:
Obligations of states and state agencies 45,848  —  (840) 45,008 
Municipal bonds 179,928  —  (37,555) 142,373 
Total obligations of states and political subdivisions 225,776  —  (38,395) 187,381 
Residential mortgage-backed securities 3,034,723  16,242  (83,430) 2,967,535 
Corporate and other debt securities 198,802  310  (13,977) 185,135 
Total $ 3,804,160  $ 16,574  $ (162,030) $ 3,658,704 
December 31, 2024
U.S. Treasury securities $ 319,551  $ —  $ (28,002) $ 291,549 
U.S. government agency securities 24,636  20  (2,113) 22,543 
Obligations of states and political subdivisions:
Obligations of states and state agencies 46,211  —  (682) 45,529 
Municipal bonds 179,284  —  (32,304) 146,980 
Total obligations of states and political subdivisions 225,495  —  (32,986) 192,509 
Residential mortgage-backed securities 2,784,895  3,796  (107,615) 2,681,076 
Corporate and other debt securities 197,696  247  (15,896) 182,047 
Total $ 3,552,273  $ 4,063  $ (186,612) $ 3,369,724 

Accrued interest on investments, which is excluded from the amortized cost of AFS debt securities, totaled $14.7 million and $13.1 million at March 31, 2025 and December 31, 2024, respectively, and is presented within total accrued interest receivable on the consolidated statements of financial condition.
17


The age of unrealized losses and fair value of the related AFS debt securities at March 31, 2025 and December 31, 2024 were as follows: 
  Less than 12 Months More than 12 Months Total
  Fair
Value		 Unrealized
Losses		 Fair
Value		 Unrealized
Losses		 Fair
Value		 Unrealized
Losses
  (in thousands)
March 31, 2025
U.S. Treasury securities $ —  $ —  $ 296,253  $ (24,756) $ 296,253  $ (24,756)
U.S. government agency securities —  —  21,158  (1,472) 21,158  (1,472)
Obligations of states and political subdivisions:
Obligations of states and state agencies
 —  —  5,938  (840) 5,938  (840)
Municipal bonds —  —  134,643  (37,555) 134,643  (37,555)
Total obligations of states and political subdivisions
 —  —  140,581  (38,395) 140,581  (38,395)
Residential mortgage-backed securities 683,881  (8,598) 499,009  (74,832) 1,182,890  (83,430)
Corporate and other debt securities 4,750  (250) 165,075  (13,727) 169,825  (13,977)
Total $ 688,631  $ (8,848) $ 1,122,076  $ (153,182) $ 1,810,707  $ (162,030)
December 31, 2024
U.S. Treasury securities $ —  $ —  $ 291,549  $ (28,002) $ 291,549  $ (28,002)
U.S. government agency securities —  —  21,281  (2,113) 21,281  (2,113)
Obligations of states and political subdivisions:
Obligations of states and state agencies
 —  —  6,208  (682) 6,208  (682)
Municipal bonds —  —  139,216  (32,304) 139,216  (32,304)
Total obligations of states and political subdivisions
 —  —  145,424  (32,986) 145,424  (32,986)
Residential mortgage-backed securities 1,483,442  (22,242) 501,858  (85,373) 1,985,300  (107,615)
Corporate and other debt securities —  —  166,800  (15,896) 166,800  (15,896)
Total $ 1,483,442  $ (22,242) $ 1,126,912  $ (164,370) $ 2,610,354  $ (186,612)
Within the AFS debt securities portfolio, the total number of security positions in an unrealized loss position was 677 and 726 at March 31, 2025 and December 31, 2024, respectively.    
As of March 31, 2025, the fair value of AFS securities that were pledged to secure public deposits, repurchase agreements, lines of credit, and for other purposes required by law, was $902.5 million.

18


Contractual Maturities
The contractual maturities of AFS debt securities at March 31, 2025 are set forth in the following table. Contractual maturities may differ from actual maturities as borrowers may have the right to call or repay obligations with or without call or prepayment penalties. Residential mortgage-backed securities are not included in the maturity categories in the following maturity summary as actual maturities may differ from contractual maturities because the underlying mortgages may be called or prepaid without penalties.
  March 31, 2025
  Amortized
Cost		 Fair
Value
  (in thousands)
Due in one year $ 178,207  $ 176,182 
Due after one year through five years 124,394  120,137 
Due after five years through ten years 171,134  155,918 
Due after ten years 295,702  238,932 
Residential mortgage-backed securities 3,034,723  2,967,535 
Total $ 3,804,160  $ 3,658,704 
The weighted average remaining expected life for residential mortgage-backed securities AFS was 9.42 years at March 31, 2025.
Impairment Analysis of Available For Sale Debt Securities
Valley's AFS debt securities portfolio includes corporate bonds and revenue bonds, among other securities. These types of securities may pose a higher risk of future impairment charges by Valley due to a variety of factors such as the unpredictable nature of the U.S. economy and its potential negative effect on the future performance of the security issuers.
AFS debt securities in unrealized loss positions are evaluated for impairment related to credit losses on a quarterly basis. Valley also evaluated AFS debt securities that were in an unrealized loss position as of March 31, 2025 included in the tables above and has determined that the declines in fair value are mainly attributable to interest rates, credit spreads, market volatility and liquidity conditions, not credit quality or other factors. Based on a comparison of the present value of expected cash flows to the amortized cost, there was no impairment recognized during the three months ended March 31, 2025 and 2024.
Valley does not intend to sell any of its AFS debt securities in an unrealized loss position prior to recovery of their amortized cost basis, and it is more likely than not that Valley will not be required to sell any of its securities prior to recovery of their amortized cost basis. None of the AFS debt securities were past due as of March 31, 2025. As a result, there was no allowance for credit losses for AFS debt securities at March 31, 2025 and December 31, 2024.

19


Held to Maturity Debt Securities
The amortized cost, gross unrealized gains and losses and fair value of HTM debt securities at March 31, 2025 and December 31, 2024 were as follows: 
Amortized
Cost		 Gross
Unrealized
Gains		 Gross
Unrealized
Losses		 Fair Value Allowance for Credit Losses Net Carrying Value
  (in thousands)
March 31, 2025
U.S. Treasury securities $ 25,290  $ —  $ (21) $ 25,269  $ —  $ 25,290 
U.S. government agency securities 300,865  —  (40,993) 259,872  —  300,865 
Obligations of states and political subdivisions:
Obligations of states and state agencies 66,602  53  (4,799) 61,856  1  66,601 
Municipal bonds 291,584  11  (24,330) 267,265  46  291,538 
Total obligations of states and political subdivisions 358,186  64  (29,129) 329,121  47  358,139 
Residential mortgage-backed securities 2,742,355  4,985  (374,064) 2,373,276  —  2,742,355 
Trust preferred securities 36,086  —  (6,606) 29,480  418  35,668 
Corporate and other debt securities 83,179  8  (2,571) 80,616  168  83,011 
Total $ 3,545,961  $ 5,057  $ (453,384) $ 3,097,634  $ 633  $ 3,545,328 
December 31, 2024
U.S. Treasury securities $ 25,480  $ —  $ (19) $ 25,461  $ —  $ 25,480 
U.S. government agency securities 301,315  —  (49,013) 252,302  —  301,315 
Obligations of states and political subdivisions:
Obligations of states and state agencies
 68,025  —  (5,335) 62,690  2  68,023 
Municipal bonds 304,464  9  (20,802) 283,671  48  304,416 
Total obligations of states and political subdivisions 372,489  9  (26,137) 346,361  50  372,439 
Residential mortgage-backed securities 2,710,642  2,088  (420,582) 2,292,148  —  2,710,642 
Trust preferred securities 36,081  —  (6,936) 29,145  414  35,667 
Corporate and other debt securities 86,213  10  (3,356) 82,867  183  86,030 
Total $ 3,532,220  $ 2,107  $ (506,043) $ 3,028,284  $ 647  $ 3,531,573 
Accrued interest on investments, which is excluded from the amortized cost of HTM debt securities, totaled $12.1 million and $13.0 million at March 31, 2025 and December 31, 2024, respectively, and is presented within total accrued interest receivable on the consolidated statements of financial condition. HTM debt securities are carried net of an allowance for credit losses (as shown in the table above).
20


The age of unrealized losses and fair value of related HTM debt securities at March 31, 2025 and December 31, 2024 were as follows: 
  Less than 12 Months More than 12 Months Total
  Fair Value Unrealized
Losses		 Fair Value Unrealized
Losses		 Fair Value Unrealized
Losses
  (in thousands)
March 31, 2025
U.S. Treasury securities $ 25,269  $ (21) $ —  $ —  $ 25,269  $ (21)
U.S. government agency securities 22,109  (58) 237,231  (40,935) 259,340  (40,993)
Obligations of states and political subdivisions:
Obligations of states and state agencies 5,948  (8) 43,721  (4,791) 49,669  (4,799)
Municipal bonds 35,687  (572) 191,086  (23,758) 226,773  (24,330)
Total obligations of states and political subdivisions
 41,635  (580) 234,807  (28,549) 276,442  (29,129)
Residential mortgage-backed securities
 43,444  (821) 1,920,109  (373,243) 1,963,553  (374,064)
Trust preferred securities —  —  29,480  (6,606) 29,480  (6,606)
Corporate and other debt securities 12,991  (9) 57,616  (2,562) 70,607  (2,571)
Total $ 145,448  $ (1,489) $ 2,479,243  $ (451,895) $ 2,624,691  $ (453,384)
December 31, 2024
U.S. Treasury securities $ 25,461  $ (19) $ —  $ —  $ 25,461  $ (19)
U.S. government agency securities 22,621  (75) 229,143  (48,938) 251,764  (49,013)
Obligations of states and political subdivisions:
Obligations of states and state agencies 20,632  (517) 42,058  (4,818) 62,690  (5,335)
Municipal bonds 36,766  (440) 210,723  (20,362) 247,489  (20,802)
Total obligations of states and political subdivisions
 57,398  (957) 252,781  (25,180) 310,179  (26,137)
Residential mortgage-backed securities
 216,651  (2,687) 1,917,644  (417,895) 2,134,295  (420,582)
Trust preferred securities —  —  29,145  (6,936) 29,145  (6,936)
Corporate and other debt securities
 5,977  (23) 63,879  (3,333) 69,856  (3,356)
Total $ 328,108  $ (3,761) $ 2,492,592  $ (502,282) $ 2,820,700  $ (506,043)
Within the HTM securities portfolio, the total number of security positions in an unrealized loss position was 743 and 798 at March 31, 2025 and December 31, 2024, respectively.
As of March 31, 2025, the fair value of debt securities HTM that were pledged to secure public deposits, repurchase agreements, lines of credit, and for other purposes required by law was $1.2 billion.






21


Contractual Maturities
The contractual maturities of investments in HTM debt securities at March 31, 2025 are set forth in the table below. Contractual maturities may differ from actual maturities as borrowers may have the right to call or repay obligations with or without call or prepayment penalties. Residential mortgage-backed securities are not included in the maturity categories in the following maturity summary as actual maturities may differ from contractual maturities because the underlying mortgages may be called or prepaid without penalties.
  March 31, 2025
  Amortized
Cost		 Fair
Value
  (in thousands)
Due in one year $ 64,515  $ 64,387 
Due after one year through five years 56,432  55,699 
Due after five years through ten years 167,145  157,478 
Due after ten years 515,514  446,794 
Residential mortgage-backed securities 2,742,355  2,373,276 
Total $ 3,545,961  $ 3,097,634 
The weighted-average remaining expected life for residential mortgage-backed securities HTM was 10.22 years at March 31, 2025.
22


Credit Quality Indicators
Valley monitors the credit quality of the HTM debt securities utilizing the most current credit ratings from external rating agencies. The following table summarizes the amortized cost of HTM debt securities by external credit rating at March 31, 2025 and December 31, 2024.
AAA/AA/A Rated BBB rated Non-rated Total
  (in thousands)
March 31, 2025
U.S. Treasury securities $ 25,290  $ —  $ —  $ 25,290 
U.S. government agency securities 300,865  —  —  300,865 
Obligations of states and political subdivisions:
Obligations of states and state agencies 51,881  —  14,721  66,602 
Municipal bonds 263,230  —  28,354  291,584 
Total obligations of states and political subdivisions
 315,111  —  43,075  358,186 
Residential mortgage-backed securities 2,742,355  —  —  2,742,355 
Trust preferred securities —  —  36,086  36,086 
Corporate and other debt securities —  6,000  77,179  83,179 
Total $ 3,383,621  $ 6,000  $ 156,340  $ 3,545,961 
December 31, 2024
U.S. Treasury securities $ 25,480  $ —  $ —  $ 25,480 
U.S. government agency securities 301,315  —  —  301,315 
Obligations of states and political subdivisions:
Obligations of states and state agencies 52,770  —  15,255  68,025 
Municipal bonds 277,921  —  26,543  304,464 
Total obligations of states and political subdivisions
 330,691  —  41,798  372,489 
Residential mortgage-backed securities 2,710,642  —  —  2,710,642 
Trust preferred securities —  —  36,081  36,081 
Corporate and other debt securities —  6,000  80,213  86,213 
Total $ 3,368,128  $ 6,000  $ 158,092  $ 3,532,220 
Obligations of states and political subdivisions include municipal bonds and revenue bonds issued by various municipal corporations. At March 31, 2025, most of the obligations of states and political subdivisions were rated investment grade and a large portion of the “non-rated” category included municipal bonds secured by Ginnie Mae securities. Trust preferred securities consist of non-rated single-issuer securities issued by bank holding companies. Corporate bonds consist of debt primarily issued by banks.
Allowance for Credit Losses for Held to Maturity Debt Securities
Valley has zero loss expectation for certain securities within the HTM portfolio, and therefore it is not required to estimate an allowance for credit losses related to these securities under the CECL standard. After an evaluation of qualitative factors, Valley identified the following security types which it believes qualify for this exclusion: U.S. Treasury securities, U.S. government agency securities, residential mortgage-backed securities issued by Ginnie Mae, Fannie Mae and Freddie Mac, and collateralized municipal bonds. To measure the expected credit losses on HTM debt securities that have loss expectations, Valley estimates the expected credit losses using a discounted cash flow model developed by a third-party.

23


The following table details the activity in the allowance for credit losses for HTM securities for the three months ended March 31, 2025 and 2024: 
Three Months Ended
March 31,
2025 2024
(in thousands)
Beginning balance $ 647  $ 1,205 
Credit for credit losses (14) (74)
Ending balance $ 633  $ 1,131 
There were no net charge-offs of HTM debt securities in the respective periods presented in the table above.
Note 7. Loans and Allowance for Credit Losses for Loans
The details of the loan portfolio as of March 31, 2025 and December 31, 2024 were as follows: 
  March 31, 2025 December 31, 2024
  (in thousands)
Loans:
Commercial and industrial $ 10,150,205  $ 9,931,400 
Commercial real estate:
Commercial real estate 26,087,621  26,530,225 
Construction 3,026,935  3,114,733 
Total commercial real estate loans 29,114,556  29,644,958 
Residential mortgage 5,636,407  5,632,516 
Consumer:
Home equity 602,161  604,433 
Automobile 2,041,227  1,901,065 
Other consumer 1,112,572  1,085,339 
Total consumer loans 3,755,960  3,590,837 
Total loans $ 48,657,128  $ 48,799,711 
Total loans include net unearned discounts and deferred loan fees of $30.1 million and $45.3 million at March 31, 2025 and December 31, 2024, respectively.
Accrued interest on loans, which is excluded from the amortized cost of loans held for investment, totaled $205.3 million and $208.9 million at March 31, 2025 and December 31, 2024, respectively, and is presented within total accrued interest receivable on the consolidated statements of financial condition.
Loans Portfolio Sales and Transfers to Loans Held for Sale
Valley sells residential mortgage loans originated for sale (at fair value) primarily to Fannie Mae and Freddie Mac in the normal course of business. Under certain circumstances, Valley may decide to sell loans that were not originated with the intent to sell.
During the three months ended March 31, 2025, Valley transferred a non-performing construction loan totaling
$10.2 million, net of $638 thousand charge-offs, from the held for investment loan portfolio to loans held for sale. See Note 5 for further details.

24


During the three months ended March 31, 2024, Valley completed the sale of its commercial premium finance lending business for $96.8 million. This asset sale included $95.5 million of assets, mainly consisting of $93.6 million of loans, and $2.8 million of related liabilities. The transaction generated a $3.6 million net gain for the first quarter 2024.

There were no other transfers or sales of loans from the held for investment portfolio during the three months ended March 31, 2025 and 2024.

Credit Risk Management
Valley adheres to a credit policy designed to minimize credit risk while generating the maximum income given the level of risk appetite. Management reviews and approves these policies and procedures on a regular basis with subsequent approval by the Board annually. Credit authority relating to a significant dollar percentage of the overall portfolio is centralized and controlled by the Credit Risk Management Division and by the Credit Committee. Loan portfolio diversification is an important factor utilized by Valley to manage its risk across business sectors and through cyclical economic circumstances. Additionally, Valley does not accept crypto assets as loan collateral for any of its loan portfolio classes. See Valley’s Annual Report for further details.
Credit Quality
The following table presents past due, current, and non-accrual loans without an allowance for loan losses by loan portfolio class at March 31, 2025 and December 31, 2024:
Past Due and Non-Accrual Loans
  30-59  Days 
Past Due Loans		 60-89  Days 
Past Due Loans		 90 Days or More
Past Due Loans		 Non-Accrual Loans
Total Past Due Loans
Current Loans
Total Loans		 Non-Accrual Loans Without Allowance for Loan Losses
  (in thousands)
March 31, 2025
Commercial and industrial
 $ 3,609  $ 420  $ —  $ 110,146  $ 114,175  $ 10,036,030  $ 10,150,205  $ 20,402 
Commercial real estate:
Commercial real estate
 170  —  —  172,011  172,181  25,915,440  26,087,621  128,229 
Construction —  —  —  24,275  24,275  3,002,660  3,026,935  4,477 
Total commercial real estate loans 170  —  —  196,286  196,456  28,918,100  29,114,556  132,706 
Residential mortgage 16,747  7,700  6,892  35,393  66,732  5,569,675  5,636,407  24,643 
Consumer loans:
Home equity 1,661  379  30  4,363  6,433  595,728  602,161  1,332 
Automobile 8,508  1,454  448  242  10,652  2,030,575  2,041,227  — 
Other consumer 2,718  575  386  21  3,700  1,108,872  1,112,572  — 
Total consumer loans 12,887  2,408  864  4,626  20,785  3,735,175  3,755,960  1,332 
Total $ 33,413  $ 10,528  $ 7,756  $ 346,451  $ 398,148  $ 48,258,980  $ 48,657,128  $ 179,083 

25


  Past Due and Non-Accrual Loans    
 
30-59
Days
Past Due Loans		 60-89 
Days
Past Due Loans		 90 Days or More
Past Due Loans		 Non-Accrual Loans
Total Past Due Loans
Current Loans		 Total Loans Non-Accrual Loans Without Allowance for Loan Losses
(in thousands)
December 31, 2024
Commercial and industrial $ 2,389  $ 1,007  $ 1,307  $ 136,675  $ 141,378  $ 9,790,022  $ 9,931,400  $ 15,947 
Commercial real estate:
Commercial real estate 20,902  24,903  —  157,231  203,036  26,327,189  26,530,225  91,095 
Construction —  —  —  24,591  24,591  3,090,142  3,114,733  5,002 
Total commercial real estate loans 20,902  24,903  —  181,822  227,627  29,417,331  29,644,958  96,097 
Residential mortgage 21,295  5,773  3,533  36,786  67,387  5,565,129  5,632,516  23,543 
Consumer loans:
Home equity 1,651  181  —  3,961  5,793  598,640  604,433  1,341 
Automobile 8,583  1,346  407  230  10,566  1,890,499  1,901,065  — 
Other consumer 2,318  2,957  642  24  5,941  1,079,398  1,085,339  — 
Total consumer loans 12,552  4,484  1,049  4,215  22,300  3,568,537  3,590,837  1,341 
Total $ 57,138  $ 36,167  $ 5,889  $ 359,498  $ 458,692  $ 48,341,019  $ 48,799,711  $ 136,928 
Credit quality indicators. Valley utilizes an internal loan classification system as a means of reporting problem loans within commercial and industrial, commercial real estate, and construction loan portfolio classes. Under Valley’s internal risk rating system, loan relationships could be classified as “Pass,” “Special Mention,” “Substandard,” “Doubtful,” and “Loss.” Substandard loans include loans that exhibit well-defined weakness and are characterized by the distinct possibility that Valley will sustain some loss if the deficiencies are not corrected. Loans classified as Doubtful have all the weaknesses inherent in those classified as Substandard with the added characteristic that the weaknesses present make collection or liquidation in full, based on currently existing facts, conditions and values, highly questionable and improbable. Loans classified as Loss are those considered uncollectible with insignificant value and are charged-off immediately to the allowance for loan losses and, therefore, not presented in the table below. Loans that do not currently pose a sufficient risk to warrant classification in one of the aforementioned categories but pose weaknesses that deserve management’s close attention are deemed Special Mention. Pass rated loans do not currently pose any identified risk and can range from the highest to average quality, depending on the degree of potential risk. Risk ratings are updated any time the situation warrants.
26


The following table presents the internal loan classification risk by loan portfolio class by origination year based on the most recent analysis performed at March 31, 2025 and December 31, 2024, as well as the gross loan charge-offs by year of origination for the three months ended March 31, 2025 and for the year ended December 31, 2024:
  Term Loans    
Amortized Cost Basis by Origination Year
March 31, 2025 2025 2024 2023 2022 2021
Prior to 2021
 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Total
  (in thousands)
Commercial and industrial
Risk Rating:
Pass $ 402,895  $ 1,683,588  $ 775,801  $ 657,761  $ 405,335  $ 592,244  $ 4,880,356  $ 8,136  $ 9,406,116 
Special Mention 13,814  1,186  5,973  3,413  11,255  14,628  210,855  3,766  264,890 
Substandard —  36,081  13,898  62,525  4,373  52,761  217,195  20,266  407,099 
Doubtful —  —  7,120  2  321  51,744  12,913  —  72,100 
Total commercial and industrial $ 416,709  $ 1,720,855  $ 802,792  $ 723,701  $ 421,284  $ 711,377  $ 5,321,319  $ 32,168  $ 10,150,205 
Commercial real estate
Risk Rating:
Pass $ 600,990  $ 2,070,782  $ 2,622,556  $ 5,052,632  $ 3,667,440  $ 8,058,437  $ 514,996  $ 78,387  $ 22,666,220 
Special Mention —  127,965  308,325  293,431  218,617  359,533  165,641  —  1,473,512 
Substandard 37,705  68,730  159,182  452,111  330,105  834,911  14,640  68  1,897,452 
Doubtful —  —  3,060  —  34,525  12,852  —  —  50,437 
Total commercial real estate $ 638,695  $ 2,267,477  $ 3,093,123  $ 5,798,174  $ 4,250,687  $ 9,265,733  $ 695,277  $ 78,455  $ 26,087,621 
Construction
Risk Rating:
Pass $ 153,394  $ 549,099  $ 614,599  $ 324,001  $ 69,166  $ 72,943  $ 1,062,079  $ 24,850  $ 2,870,131 
Special Mention —  13,263  4,527  646  9,447  —  29,494  —  57,377 
Substandard —  773  75  8,950  4,477  —  52,222  32,930  99,427 
Total construction $ 153,394  $ 563,135  $ 619,201  $ 333,597  $ 83,090  $ 72,943  $ 1,143,795  $ 57,780  $ 3,026,935 
Gross loan charge-offs $ —  $ 70  $ 842  $ 2,488  $ 7,308  $ 6,807  $ 9,776  $ 14,588  $ 41,879 


27


  Term Loans    
Amortized Cost Basis by Origination Year
December 31, 2024 2024 2023 2022 2021 2020
Prior to 2020
 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Total
  (in thousands)
Commercial and industrial
Risk Rating:
Pass $ 1,769,585  $ 828,087  $ 703,962  $ 476,091  $ 246,992  $ 392,834  $ 4,804,095  $ 6,006  $ 9,227,652 
Special Mention 30,755  3,553  59,434  11,646  270  72,514  147,254  10,762  336,188 
Substandard 24,613  13,479  9,415  4,296  2,813  7,382  201,053  39,011  302,062 
Doubtful —  8,911  4  928  —  52,064  3,591  —  65,498 
Total commercial and industrial $ 1,824,953  $ 854,030  $ 772,815  $ 492,961  $ 250,075  $ 524,794  $ 5,155,993  $ 55,779  $ 9,931,400 
Commercial real estate
Risk Rating:
Pass $ 2,097,314  $ 2,941,270  $ 5,310,807  $ 3,883,333  $ 2,302,480  $ 6,086,608  $ 597,266  $ 78,621  $ 23,297,699 
Special Mention 156,394  380,852  289,669  192,614  55,739  327,732  141,164  —  1,544,164 
Substandard 84,410  107,944  387,638  288,906  236,927  520,858  11,167  —  1,637,850 
Doubtful —  3,060  —  35,756  9,813  1,883  —  —  50,512 
Total commercial real estate $ 2,338,118  $ 3,433,126  $ 5,988,114  $ 4,400,609  $ 2,604,959  $ 6,937,081  $ 749,597  $ 78,621  $ 26,530,225 
Construction
Risk Rating:
Pass $ 545,597  $ 680,260  $ 334,899  $ 92,765  $ 17,955  $ 45,161  $ 1,224,698  $ 58,644  $ 2,999,979 
Special Mention 13,278  —  664  5,069  —  2,504  16,691  —  38,206 
Substandard 9,835  —  8,950  4,942  —  —  43,474  —  67,201 
Doubtful —  —  2,074  —  7,273  —  —  —  9,347 
Total construction $ 568,710  $ 680,260  $ 346,587  $ 102,776  $ 25,228  $ 47,665  $ 1,284,863  $ 58,644  $ 3,114,733 
Gross loan charge-offs $ 706  $ 31,809  $ 7,523  $ 44,610  $ 66,632  $ 49,436  $ 3,930  $ 2,148  $ 206,794 
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For residential mortgages, home equity, automobile and other consumer loan portfolio classes, Valley evaluates credit quality based on the aging status of the loan and by payment activity. The following table presents the amortized cost in those loan classes based on payment activity by origination year as of March 31, 2025 and December 31, 2024, as well as the gross loan charge-offs by year of origination for the three months ended March 31, 2025 and for the year ended December 31, 2024:
  Term Loans    
Amortized Cost Basis by Origination Year
March 31, 2025 2025 2024 2023 2022 2021
Prior to 2021
 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Total
  (in thousands)
Residential mortgage
Performing $ 85,961  $ 426,158  $ 408,214  $ 1,274,491  $ 1,402,246  $ 1,939,273  $ 77,898  $ —  $ 5,614,241 
90 days or more past due —  952  769  3,276  1,749  14,739  —  681  22,166 
Total residential mortgage $ 85,961  $ 427,110  $ 408,983  $ 1,277,767  $ 1,403,995  $ 1,954,012  $ 77,898  $ 681  $ 5,636,407 
Consumer loans
Home equity
Performing $ 7,472  $ 22,481  $ 27,294  $ 38,220  $ 9,828  $ 54,408  $ 431,436  $ 9,112  $ 600,251 
90 days or more past due —  —  3  173  105  1,029  —  600  1,910 
Total home equity 7,472  22,481  27,297  38,393  9,933  55,437  431,436  9,712  602,161 
Automobile
Performing $ 345,515  $ 787,382  $ 308,544  $ 321,091  $ 178,895  $ 99,088  $ —  $ —  $ 2,040,515 
90 days or more past due —  116  95  170  94  237  —  —  712 
Total automobile 345,515  787,498  308,639  321,261  178,989  99,325  —  —  2,041,227 
Other consumer
Performing $ 5,866  $ 13,311  $ 30,004  $ 14,866  $ 1,700  $ 58,528  $ 976,315  $ 11,592  $ 1,112,182 
90 days or more past due —  30  —  61  —  38  —  261  390 
Total other consumer 5,866  13,341  30,004  14,927  1,700  58,566  976,315  11,853  1,112,572 
Total consumer $ 358,853  $ 823,320  $ 365,940  $ 374,581  $ 190,622  $ 213,328  $ 1,407,751  $ 21,565  $ 3,755,960 
Gross loan charge-offs $ —  $ 522  $ 297  $ 348  $ 152  $ 762  $ —  $ 59  $ 2,140 

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  Term Loans    
Amortized Cost Basis by Origination Year
December 31, 2024 2024 2023 2022 2021 2020
Prior to 2020
 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Total
  (in thousands)
Residential mortgage
Performing $ 428,138  $ 413,528  $ 1,282,524  $ 1,420,835  $ 494,430  $ 1,490,512  $ 75,479  $ 954  $ 5,606,400 
90 days or more past due 530  771  1,030  1,533  5,286  16,285  —  681  26,116 
Total residential mortgage $ 428,668  $ 414,299  $ 1,283,554  $ 1,422,368  $ 499,716  $ 1,506,797  $ 75,479  $ 1,635  $ 5,632,516 
Consumer loans
Home equity
Performing $ 22,947  $ 29,445  $ 38,774  $ 10,302  $ 3,340  $ 50,613  $ 438,817  $ 9,061  $ 603,299 
90 days or more past due —  48  51  1  —  855  —  179  1,134 
Total home equity 22,947  29,493  38,825  10,303  3,340  51,468  438,817  9,240  604,433 
Automobile
Performing $ 863,281  $ 343,203  $ 363,901  $ 211,294  $ 59,288  $ 59,512  $ —  $ —  $ 1,900,479 
90 days or more past due 71  122  140  70  2  181  —  —  586 
Total automobile 863,352  343,325  364,041  211,364  59,290  59,693  —  —  1,901,065 
Other consumer
Performing $ 15,164  $ 25,884  $ 15,787  $ 1,588  $ 337  $ 53,917  $ 956,339  $ 15,917  $ 1,084,933 
90 days or more past due —  59  61  —  —  38  —  248  406 
Total other consumer 15,164  25,943  15,848  1,588  337  53,955  956,339  16,165  1,085,339 
Total consumer $ 901,463  $ 398,761  $ 418,714  $ 223,255  $ 62,967  $ 165,116  $ 1,395,156  $ 25,405  $ 3,590,837 
Gross loan charge-offs $ 1,014  $ 1,883  $ 1,511  $ 1,015  $ 519  $ 2,245  $ —  $ 131  $ 8,318 
Loan modifications to borrowers experiencing financial difficulty. From time to time, Valley may extend, restructure, or otherwise modify the terms of existing loans, on a case-by-case basis, to remain competitive and retain certain customers, as well as assist other customers who may be experiencing financial difficulties.

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The following tables present the amortized cost basis of loans to borrowers experiencing financial difficulty at March 31, 2025 that were modified during the three months ended March 31, 2025 and 2024, disaggregated by class of financing receivable and type of modification.
Term extension Term extension and interest rate reduction Term extension and principal forgiveness Other than Insignificant Payment Delay Total % of Total Loan Class
  ($ in thousands)
Three Months Ended
March 31, 2025
Commercial and industrial $ 2,145  $ —  $ —  $ 5,660  $ 7,805  0.08  %
Commercial real estate 7,398  —  20,823  396  28,617  0.11 
Total $ 9,543  $ —  $ 20,823  $ 6,056  $ 36,422  0.07  %
Three Months Ended
March 31, 2024
Commercial and industrial $ 34,271  $ 143  $ —  $ —  $ 34,414  0.38  %
Commercial real estate 62  16,222  —  —  16,284  0.06 
Home equity 91  —  —  —  91  0.02 
Total $ 34,424  $ 16,365  $ —  $ —  $ 50,789  0.10  %
The following table describes the types of modifications made to borrowers experiencing financial difficulty during the three months ended March 31, 2025 and 2024:
Weighted Average Interest Rate Reduction Weighted Average Term Extension (in months) Principal Forgiveness (in thousands) Weighted Average Payment Deferral (in months)
Three Months Ended
March 31, 2025
Commercial and industrial —  % 11 $ —  6
Commercial real estate —  31 17,500  * 6
Three Months Ended
March 31, 2024
Commercial and industrial 1.11  % 3 $ —  — 
Commercial real estate 1.06  12 —  — 
Home equity —  120 —  — 
*    Relates to one loan that was partially charged off during the fourth quarter 2024 with the subsequent execution of the corresponding principal forgiveness completed in the first quarter 2025.
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Valley closely monitors the performance of modified loans to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table presents the aging analysis of loans that have been modified within the previous 12 months at March 31, 2025 and 2024.
Current 30-89 Days Past Due 90 Days or More Past Due Total
March 31, 2025 ($ in thousands)
Commercial and industrial $ 113,632  * $ —  $ —  $ 113,632 
Commercial real estate 243,689  —  46  243,735 
Residential mortgage 2,051  —  95  2,146 
Home equity 41  —  —  41 
Total $ 359,413  $ —  $ 141  $ 359,554 
March 31, 2024
Commercial and industrial $ 73,859  * $ 5,916  * $ 4,943  * $ 84,718 
Commercial real estate 96,217  —  2,153  98,370 
Residential mortgage —  360  —  360 
Home equity 122  —  —  122 
Total $ 170,198  $ 6,276  $ 7,096  $ 183,570 
*    Includes non-accrual loans.
The following table provides the amortized cost basis of financing receivables that had a payment default during the three months ended March 31, 2025 and 2024 and were modified in the 12 months before default to borrowers experiencing financial difficulty.
March 31, 2025 Term extension Other than Insignificant Payment Delay
  (in thousands)
Commercial real estate $ 46  $ — 
Residential mortgage —  95 
Total $ 46  $ 95 
March 31, 2024
Commercial and industrial $ 7,096  $ — 
Total $ 7,096  $ — 
Loans in process of foreclosure. OREO balance totaled $7.7 million and $12.2 million at March 31, 2025 and December 31, 2024, respectively. Residential mortgage and consumer loans secured by residential real estate properties for which formal foreclosure proceedings are in process totaled $4.3 million and $4.6 million at March 31, 2025 and December 31, 2024, respectively.
Collateral dependent loans. Loans are collateral dependent when the debtor is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral. When Valley determines that repayment or satisfaction of the loan depends on the sale of the collateral, the collateral dependent loan balances are written down to the estimated current fair value (less estimated selling costs) resulting in an immediate charge-off to the allowance, excluding any consideration for personal guarantees that may be pursued in the Bank’s collection process.
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The following table presents collateral dependent loans by class as of March 31, 2025 and December 31, 2024:
  March 31,
2025		 December 31,
2024
  (in thousands)
Collateral dependent loans:
Commercial and industrial * $ 102,046  $ 131,898 
Commercial real estate 163,248  156,825 
Construction 4,477  15,841 
Total commercial real estate loans 167,725  172,666 
Residential mortgage 24,897  23,797 
Home equity 1,332  1,341 
Total $ 296,000  $ 329,702 
*    Include non-accrual loans collateralized by taxi medallions totaling $49.2 million and $49.5 million at March 31, 2025 and December 31, 2024, respectively.
Allowance for Credit Losses for Loans
The allowance for credit losses for loans consists of the allowance for loan losses and the allowance for unfunded credit commitments.
The following table summarizes the ACL for loans at March 31, 2025 and December 31, 2024: 
March 31,
2025		 December 31,
2024
  (in thousands)
Components of allowance for credit losses for loans:
Allowance for loan losses $ 578,200  $ 558,850 
Allowance for unfunded credit commitments 15,854  14,478 
Total allowance for credit losses for loans $ 594,054  $ 573,328 
The following table summarizes the provision for credit losses for loans for the periods indicated:
  Three Months Ended
March 31,
  2025 2024
  (in thousands)
Components of provision for credit losses for loans:
Provision for loan losses $ 61,299  $ 46,723 
Provision (credit) for unfunded credit commitments 1,376  (1,449)
Total provision for credit losses for loans $ 62,675  $ 45,274 
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The following table details the activity in the allowance for loan losses by portfolio segment for the three months ended March 31, 2025 and 2024: 
Commercial
and Industrial		 Commercial
Real Estate		 Residential
Mortgage		 Consumer Total
  (in thousands)
Three Months Ended
March 31, 2025
Allowance for loan losses:
Beginning balance $ 173,002  $ 304,148  $ 58,895  $ 22,805  $ 558,850 
Loans charged-off (28,456) (13,423) —  (2,140) (44,019)
Charged-off loans recovered 810  249  168  843  2,070 
Net (charge-offs) recoveries (27,646) (13,174) 168  (1,297) (41,949)
Provision (credit) for loan losses 39,344  30,688  (10,157) 1,424  61,299 
Ending balance $ 184,700  $ 321,662  $ 48,906  $ 22,932  $ 578,200 
Three Months Ended
March 31, 2024
Allowance for loan losses:
Beginning balance $ 133,359  $ 249,598  $ 42,957  $ 20,166  $ 446,080 
Loans charged-off (14,293) (8,798) —  (1,809) (24,900)
Charged-off loans recovered 682  241  25  397  1,345 
Net (charge-offs) recoveries (13,611) (8,557) 25  (1,412) (23,555)
Provision for loan losses 18,845  24,806  1,395  1,677  46,723 
Ending balance $ 138,593  $ 265,847  $ 44,377  $ 20,431  $ 469,248 


34


The following table represents the allocation of the allowance for loan losses and the related loans by loan portfolio segment disaggregated based on the allowance measurement methodology at March 31, 2025 and December 31, 2024.
Commercial and Industrial Commercial
Real Estate		 Residential
Mortgage		 Consumer Total
  (in thousands)
March 31, 2025
Allowance for loan losses:
Individually evaluated for credit losses $ 52,745  $ 8,674  $ 26  $ —  $ 61,445 
Collectively evaluated for credit losses 131,955  312,988  48,880  22,932  516,755 
Total $ 184,700  $ 321,662  $ 48,906  $ 22,932  $ 578,200 
Loans:
Individually evaluated for credit losses $ 102,046  $ 167,725  $ 24,897  $ 1,332  $ 296,000 
Collectively evaluated for credit losses 10,048,159  28,946,831  5,611,510  3,754,628  48,361,128 
Total $ 10,150,205  $ 29,114,556  $ 5,636,407  $ 3,755,960  $ 48,657,128 
December 31, 2024
Allowance for loan losses:
Individually evaluated for credit losses $ 59,603  $ 16,225  $ 27  $ —  $ 75,855 
Collectively evaluated for credit losses 113,399  287,923  58,868  22,805  482,995 
Total $ 173,002  $ 304,148  $ 58,895  $ 22,805  $ 558,850 
Loans:
Individually evaluated for credit losses $ 131,898  $ 172,666  $ 23,797  $ 1,341  $ 329,702 
Collectively evaluated for credit losses 9,799,502  29,472,292  5,608,719  3,589,496  48,470,009 
Total $ 9,931,400  $ 29,644,958  $ 5,632,516  $ 3,590,837  $ 48,799,711 
Note 8. Goodwill and Other Intangible Assets
The carrying amounts of goodwill allocated to Valley's reporting units at both March 31, 2025 and December 31, 2024, were as follows:
Reporting Unit *
Wealth
Management		 Consumer
Banking		 Commercial
Banking		 Total
(in thousands)
$ 78,142  $ 349,646  $ 1,441,148  $ 1,868,936 
*    The Wealth Management and Consumer Banking reporting units are both components of the overall Consumer Banking operating segment, which is further described in Note 15.
During the three months ended March 31, 2025, there were no triggering events that would more likely than not reduce the fair value of any reporting unit below its carrying amount. There was no impairment of goodwill recognized during the three months ended March 31, 2025 and 2024.
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The following table summarizes other intangible assets as of March 31, 2025 and December 31, 2024: 
Gross
Intangible
Assets		 Accumulated
Amortization		 Net
Intangible
Assets
  (in thousands)
March 31, 2025
Loan servicing rights $ 126,659  $ (105,739) $ 20,920 
Core deposits 215,620  (143,767) 71,853 
Other 50,393  (21,826) 28,567 
Total other intangible assets $ 392,672  $ (271,332) $ 121,340 
December 31, 2024
Loan servicing rights $ 125,961  $ (104,833) $ 21,128 
Core deposits 215,620  (138,080) 77,540 
Other 50,393  (20,400) 29,993 
Total other intangible assets $ 391,974  $ (263,313) $ 128,661 
Loan servicing rights are accounted for using the amortization method. Under this method, Valley amortizes the loan servicing assets over the period of the economic life of the assets arising from estimated net servicing revenues. On a quarterly basis, Valley stratifies its loan servicing assets into groupings based on risk characteristics and assesses each group for impairment based on fair value. Impairment charges on loan servicing rights are recognized in earnings when the book value of a stratified group of loan servicing rights exceeds its estimated fair value. There was no impairment of loan servicing rights recognized during the three months ended March 31, 2025 and 2024.
Core deposits are amortized using an accelerated method over a period of 10.0 years. The line item labeled “Other” included in the table above primarily consists of customer lists, certain financial asset servicing contracts and covenants not to compete, which are amortized over their expected lives generally using a straight-line method and have a weighted average amortization period of approximately 13.5 years.
Valley evaluates core deposits and other intangibles for impairment when an indication of impairment exists. There was no impairment of core deposits and other intangibles recognized during the three months ended March 31, 2025 and 2024.
The following table presents the estimated future amortization expense of other intangible assets for the remainder of 2025 through 2029: 
Year Loan Servicing
Rights		 Core
Deposits		 Other
  (in thousands)
2025 $ 1,990  $ 15,361  $ 3,954 
2026 2,413  17,223  4,805 
2027 2,124  13,544  4,205 
2028 1,862  10,117  3,633 
2029 1,643  7,500  3,081 
Valley recognized amortization expense on other intangible assets totaling approximately $8.0 million and $9.4 million for the three months ended March 31, 2025 and 2024, respectively.

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Note 9. Deposits
Included in time deposits are certificates of deposit over $250 thousand totaling $2.4 billion at both March 31, 2025 and December 31, 2024.
The scheduled maturities of time deposits as of March 31, 2025 were as follows: 
Year Amount
  (in thousands)
2025 $ 7,611,465 
2026 2,725,068 
2027 1,265,409 
2028 278,296 
2029 28,835 
Thereafter 14,935 
Total time deposits $ 11,924,008 
Note 10. Borrowed Funds
Short-Term Borrowings
Short-term borrowings at March 31, 2025 and December 31, 2024 consisted of the following:
March 31, 2025 December 31, 2024
  (in thousands)
Securities sold under agreements to repurchase $ 59,026  $ 72,718 
Total short-term borrowings $ 59,026  $ 72,718 
Long-Term Borrowings
Long-term borrowings at March 31, 2025 and December 31, 2024 consisted of the following:    
March 31, 2025 December 31, 2024
  (in thousands)
FHLB advances, net $ 2,253,604  $ 2,526,608 
Subordinated debt, net *
 650,963  647,547 
Total long-term borrowings $ 2,904,567  $ 3,174,155 
*
Subordinated debt is reported net of debt issuance costs that were immaterial at both March 31, 2025 and December 31, 2024.
FHLB advances. Long-term FHLB advances had a weighted average interest rate of 4.47 percent and 4.20 percent at March 31, 2025 and December 31, 2024, respectively. FHLB advances are secured by pledges of certain eligible collateral, including but not limited to, U.S. government and agency mortgage-backed securities and a blanket assignment of qualifying first lien mortgage loans, consisting of both residential mortgage and commercial real estate loans.


37


The long-term FHLB advances at March 31, 2025 are scheduled for contractual balance repayments as follows:
Year Amount
  (in thousands)
2025 $ — 
2026 601,804 
2027 926,800 
2028 475,000 
2029 250,000 
Total long-term FHLB advances $ 2,253,604 
The FHLB advances reported in the table above are not callable for early redemption.
Subordinated debt. There were no new issuances of subordinated debt during the three months ended March 31, 2025. See Note 10 in Valley’s Annual Report for additional information on the outstanding subordinated debt at March 31, 2025.
Note 11. Stock–Based Compensation
Valley maintains an incentive compensation plan to provide additional long-term incentives to officers, employees and non- employee directors whose contributions are essential to the continued growth and success of Valley. Under the plan, Valley may issue awards in amounts up to 14.5 million, subject to certain adjustments. As of March 31, 2025, 6.9 million shares of common stock were available for issuance under the plan.
RSUs are awarded as performance-based RSUs and time-based RSUs. Performance-based RSUs vest based on (i) growth in tangible book value per share plus dividends and (ii) total shareholder return as compared to our peer group. The performance based RSUs “cliff” vest after three years based on the cumulative performance of Valley during that time period. Generally, time-based RSUs vest ratably in one-third increments each year over a three-year vesting period. The RSUs earn dividend equivalents (equal to cash dividends paid on Valley's common shares) over the applicable performance or service period. Dividend equivalents, per the terms of the agreements, are accumulated and paid to the grantee at the vesting date or forfeited if the applicable performance or service conditions are not met.
The table below summarizes RSU awards granted and average grant date fair values for the three months ended March 31, 2025 and 2024:
Three Months Ended
March 31,
2025 2024
(in thousands, except per share data)
Award shares granted:
Performance-based RSUs 649  958 
Time-based RSUs 2,506  2,794 
Average grant date fair value per share:
Performance-based RSUs $ 11.06  $ 7.88 
Time-based RSUs $ 9.96  $ 8.51 
Stock award fair values are expensed over the shorter of the vesting or required service period. Valley recorded total stock-based compensation expense of approximately $6.8 million and $8.1 million for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, the unrecognized amortization expense for all stock-based employee compensation totaled approximately $51.7 million. This expense will be recognized over an average remaining vesting period of approximately 2.4 years. See Note 12 in Valley’s Annual Report for additional information on the stock-based compensation awards.
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Note 12. Derivative Instruments and Hedging Activities
Valley enters into derivative financial instruments to manage exposures that arise from business activities that result in the payment of future known and uncertain cash amounts, the value of which are determined by interest and currency rates.
Cash Flow Hedges of Interest Rate Risk.  Valley’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish these objectives, Valley has used interest rate swaps, from time to time, as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the payment of either fixed or variable-rate amounts in exchange for the receipt of variable or fixed-rate amounts from a counterparty, respectively.
Fair Value Hedges of Fixed Rate Assets and Liabilities. Valley is exposed to changes in the fair value of certain fixed-rate assets and liabilities due to changes in interest rates and uses interest rate swaps to manage the exposure to changes in fair value. For derivatives that are designated and qualify as fair value hedges, the gain or loss on the derivative as well as the loss or gain on the hedged item attributable to the hedged risk are recognized in earnings.
During the third quarter 2024, Valley terminated interest rate swaps with a total notional amount of $500 million used to hedge the fair value of certain fixed rate residential loans. The carrying amount of the hedged assets included an immaterial cumulative loss adjustment at the date of termination that will be amortized to earnings through the fourth quarter 2025. See Note 15 to Valley's Annual Report for additional information regarding Valley's fair value hedges.
Non-designated Hedges. Derivatives not designated as hedges may be used to manage Valley’s exposure to interest rate movements or to provide a service to customers but do not meet the requirements for hedge accounting under GAAP. Derivatives not designated as hedges are not entered into for speculative purposes. Valley executes interest rate swaps with commercial lending customers to facilitate their respective risk management strategies. These interest rate swaps with customers are simultaneously offset by interest rate swaps that Valley executes with a third- party, such that Valley minimizes its net risk exposure resulting from such transactions. As these interest rate swaps do not meet the strict hedge accounting requirements, changes in the fair value of both the customer swaps and the offsetting swaps are recognized directly in earnings.
Valley sometimes enters into risk participation agreements with external lenders where the banks are sharing their risk of default on the interest rate swaps on participated loans. Valley either pays or receives a fee depending on the type of participation. Risk participation agreements are credit derivatives not designated as hedges. Credit derivatives are not speculative and are not used to manage interest rate risk in assets or liabilities. Changes in the fair value in credit derivatives are recognized directly in earnings. At March 31, 2025, Valley had 61 credit swaps with an aggregate notional amount of $855.7 million related to risk participation agreements.
At March 31, 2025, Valley had two “steepener” swaps, each with a current notional amount of $10.4 million where the receive rate on the swap mirrors the pay rate on the brokered deposits and the rates paid on these types of hybrid instruments are based on a formula derived from the spread between the long and short ends of the Constant Maturity Swap rate curve. Although these types of instruments do not meet the hedge accounting requirements, the change in fair value of both the bifurcated derivative and the stand-alone swap tend to move in opposite directions with changes in the three-month Term SOFR rate and, therefore, provide an effective economic hedge.
Valley regularly enters into mortgage banking derivatives which are non-designated hedges. These derivatives include interest rate lock commitments provided to customers to fund certain residential mortgage loans to be sold into the secondary market and forward commitments for the future delivery of such loans. Valley enters into forward commitments for the future delivery of residential mortgage loans when interest rate lock commitments are entered into in order to economically hedge the effect of future changes in interest rates on Valley's commitments to fund the loans as well as on its portfolio of mortgage loans held for sale.
Valley enters into foreign currency forward and option contracts, primarily to accommodate our customers, that are not designated as hedging instruments. Upon the origination of certain foreign currency denominated transactions (including foreign currency holdings and non-U.S.
39


dollar denominated loans) with a client, we enter into a respective hedging contract with a third party financial institution to mitigate the economic impact of foreign currency exchange rate fluctuation.
During June 2024, Valley entered into a credit default swap related to approximately $1.5 billion in automobile loans primarily to enhance the risk profile of these assets for regulatory capital purposes. The covered loans have a total remaining balance of approximately $1.0 billion within Valley's $2.0 billion automobile loan portfolio at March 31, 2025. The credit default swap is a free-standing contract measured at fair value with resulting gains or losses recognized in non-interest expense. The premium amortization expense associated with the credit protection totaled $2.0 million for the three months ended March 31, 2025 and was recorded in other expense reported in non-interest expense.
Amounts included in the consolidated statements of financial condition related to the fair value of Valley’s derivative financial instruments were as follows: 
  March 31, 2025 December 31, 2024
  Fair Value Fair Value
Other Assets Other Liabilities Notional Amount Other Assets Other Liabilities Notional Amount
  (in thousands)
Derivatives designated as hedging instruments:
Fair value hedge interest rate swaps $ 7,078  $ 13,641  $ 780,322  $ 2,419  $ 13,993  $ 780,322 
Total derivatives designated as hedging instruments $ 7,078  $ 13,641  $ 780,322  $ 2,419  $ 13,993  $ 780,322 
Derivatives not designated as hedging instruments:
Interest rate swaps and other contracts*
 $ 304,321  $ 304,084  $ 16,545,194  $ 423,683  $ 423,492  $ 16,209,499 
Foreign currency derivatives 15,295  14,968  1,532,812  18,011  16,488  1,688,338 
Mortgage banking derivatives 28  151  32,605  150  192  45,752 
Credit default swap —  44  1,001,143  —  35  1,142,026 
Total derivatives not designated as hedging instruments $ 319,644  $ 319,247  $ 19,111,754  $ 441,844  $ 440,207  $ 19,085,615 
Total derivative financial instruments $ 326,722  $ 332,888  $ 19,892,076  $ 444,263  $ 454,200  $ 19,865,937 
* Other derivative contracts include risk participation agreements.
Gains included in the consolidated statements of income and other comprehensive loss, on a pre-tax basis, related to previously terminated interest rate derivatives designated as hedges of cash flows were as follows: 
  Three Months Ended
March 31,
  2025 2024
  (in thousands)
Amount of gain reclassified from accumulated other comprehensive loss to interest income $ 301  $ 298 
The accumulated after-tax gains related to the previously terminated cash flow hedges included in accumulated other comprehensive loss were $1.0 million and $1.2 million at March 31, 2025 and December 31, 2024, respectively. Valley estimates that $1.0 million (before tax) will be reclassified as an increase to interest income over the next 12 months.
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Gains (losses) included in the consolidated statements of income related to interest rate derivatives designated as hedges of fair value were as follows: 
Three Months Ended
March 31,
2025 2024
  (in thousands)
Derivative - interest rate swap:
Interest income $ —  $ 4,879 
Interest expense 4,569  (1,291)
Hedged items - loans, time deposits and subordinated debt:
Interest income $ (161) $ (4,924)
Interest expense (4,532) 1,383 
The changes in the fair value of the hedged item designated as a qualifying hedge are captured as an adjustment to the carrying amount of the hedged item (basis adjustment). The following table presents the hedged item related to interest rate derivatives designated as fair value hedges and the cumulative basis fair value adjustment included in the net carrying amount of the hedged item at March 31, 2025 and December 31, 2024, respectively.
Line Item in the Statement of Financial Condition in Which the Hedged Item is Included Net Carrying Amount of the Hedged Asset/ Liability Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Asset/Liability
(in thousands)
March 31, 2025
Time deposits $ 484,240  $ 3,936 
Long-term borrowings * 288,183  (10,843)
December 31, 2024
Time deposits $ 482,723  $ 2,419 
Long-term borrowings * 284,966  (13,859)
*    Net carrying amount includes unamortized debt issuance costs of $1.0 million and $1.2 million at March 31, 2025 and December 31, 2024, respectively.
The net losses included in the consolidated statements of income related to derivative instruments not designated as hedging instruments were as follows: 
  Three Months Ended
March 31,
  2025 2024
  (in thousands)
Non-designated hedge interest rate swaps and credit derivatives
Other non-interest expense $ (3,059) $ (1,055)
Capital markets income reported in non-interest income included fee income related to non-designated hedge derivative interest rate swaps executed with commercial loan customers and foreign exchange contracts (not designated as hedging instruments) with a combined total of $5.8 million and $4.5 million for the three months ended March 31, 2025 and 2024, respectively.
Collateral Requirements and Credit Risk Related Contingent Features. By using derivatives, Valley is exposed to credit risk if counterparties to the derivative contracts do not perform as expected. Management attempts to minimize counterparty credit risk through credit approvals, limits, monitoring procedures and obtaining collateral where appropriate. Credit risk exposure associated with derivative contracts is managed at Valley in conjunction with Valley’s consolidated counterparty risk management process.
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Valley’s counterparties and the risk limits monitored by management are periodically reviewed and approved by the Board.
Valley has agreements with its derivative counterparties providing that if Valley defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then Valley could also be declared in default on its derivative counterparty agreements. Additionally, Valley has an agreement with several of its derivative counterparties that contains provisions that require Valley’s debt to maintain an investment grade credit rating from each of the major credit rating agencies from which it receives a credit rating. If Valley’s credit rating is reduced below investment grade, or such rating is withdrawn or suspended, then the counterparties could terminate the derivative positions and Valley would be required to settle its obligations under the agreements. As of March 31, 2025, Valley was in compliance with all of the provisions of its derivative counterparty agreements. The aggregate fair value of all derivative financial instruments with credit risk-related contingent features was in a net asset position at March 31, 2025. Valley has derivative counterparty agreements that require minimum collateral posting thresholds for certain counterparties.
Note 13. Balance Sheet Offsetting
Certain financial instruments, including certain OTC derivatives (mostly interest rate swaps) and repurchase agreements (accounted for as secured long-term borrowings), may be eligible for offset in the consolidated statements of financial condition and/or subject to master netting arrangements or similar agreements. OTC derivatives include interest rate swaps executed and settled bilaterally with counterparties without the use of an organized exchange or central clearing house (presented in the table below). The credit risk associated with bilateral OTC derivatives is managed through obtaining collateral and enforceable master netting agreements.
Valley is party to master netting arrangements with its financial institution counterparties; however, Valley does not offset assets and liabilities under these arrangements for financial statement presentation purposes. The master netting arrangements provide for a single net settlement of all swap agreements, as well as collateral, in the event of default on, or termination of, any one contract. Collateral, usually in the form of cash or marketable investment securities, is posted by or received from the counterparty with net liability or asset positions, respectively, in accordance with contract thresholds. Master repurchase agreements which include “right of set-off” provisions generally have a legally enforceable right to offset recognized amounts. In such cases, the collateral would be used to settle the fair value of the swap or repurchase agreement should Valley be in default.
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Total amount of collateral held or pledged cannot exceed the net derivative fair values with the counterparty.
The table below presents information about Valley’s financial instruments eligible for offset in the consolidated statements of financial condition as of March 31, 2025 and December 31, 2024.
        Gross Amounts Not Offset  
  Gross Amounts
Recognized		 Gross Amounts
Offset		 Net Amounts
Presented		 Financial
Instruments		 Cash
Collateral *		 Net
Amount
  (in thousands)
March 31, 2025
Assets
Interest rate swaps and other contracts $ 311,399  $ —  $ 311,399  $ 48,470  $ (248,322) $ 111,547 
Liabilities
Interest rate swaps and other contracts $ 317,725  $ —  $ 317,725  $ (48,470) $ —  $ 269,255 
December 31, 2024
Assets
Interest rate swaps and other contracts $ 426,102  $ —  $ 426,102  $ 32,571  $ (358,520) $ 100,153 
Liabilities
Interest rate swaps and other contracts $ 437,485  $ —  $ 437,485  $ (32,571) $ —  $ 404,914 
*    Cash collateral received from or pledged to our counterparties in relation to market value exposures of OTC derivative contracts in an asset/liability position.
Note 14. Tax Credit Investments
Valley’s tax credit investments are primarily related to investments promoting qualified affordable housing projects, and other investments related to community development and renewable energy sources. Some of these tax-advantaged investments support Valley’s regulatory compliance with the CRA. Valley’s investments in these entities generate a return primarily through the realization of federal income tax credits and other tax benefits, such as tax deductions from operating losses of the investments, over specified time periods. These tax credits and deductions are recognized as a reduction of income tax expense.
Valley’s tax credit investments are carried in other assets on the consolidated statements of financial condition. Valley’s unfunded capital and other commitments related to the tax credit investments are carried in accrued expenses and other liabilities on the consolidated statements of financial condition. Valley recognizes amortization of tax credit investments, including impairment losses, within non-interest expense in the consolidated statements of income using the equity method of accounting. After initial measurement, the carrying amounts of tax credit investments with non-readily determinable fair values are increased to reflect Valley's share of income of the investee and are reduced to reflect its share of losses of the investee, dividends received and impairments, if applicable.

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The following table presents the balances of Valley’s affordable housing tax credit investments, other tax credit investments, and related unfunded commitments at March 31, 2025 and December 31, 2024:
March 31,
2025		 December 31,
2024
(in thousands)
Other assets:
Affordable housing tax credit investments, net $ 21,848  $ 22,742 
Other tax credit investments, net 329,829  278,468 
Total tax credit investments, net $ 351,677  $ 301,210 
The following table presents other information relating to Valley’s affordable housing tax credit investments and other tax credit investments for the three months ended March 31, 2025 and 2024: 
Three Months Ended
March 31,
2025 2024
(in thousands)
Components of income tax expense:
Affordable housing tax credits and other tax benefits $ 1,225  $ 1,396 
Other tax credit investment credits and tax benefits 10,889  6,345 
Total reduction in income tax expense $ 12,114  $ 7,741 
Amortization of tax credit investments:
Affordable housing tax credit investment losses $ 700  $ 875 
Affordable housing tax credit investment impairment losses 365  481 
Other tax credit investment losses 772  600 
Other tax credit investment impairment losses 7,483  3,606 
Total amortization of tax credit investments recorded in non-interest expense $ 9,320  $ 5,562 
Note 15. Operating Segments
Valley manages its business operations under operating segments consisting of Consumer Banking and Commercial Banking. Activities not assigned to the operating segments are included in Treasury and Corporate Other.
The CEO of Valley is the CODM who assesses performance of each operating segment to better understand their cost, opportunity value and impact to Valley's consolidated earnings. Each operating segment is reviewed routinely for its asset growth, contribution to our income before income taxes, return on average interest earning assets and impairment (if events or circumstances indicate a possible inability to realize the carrying amount). Valley regularly assesses its strategic plans, operations, and reporting structures to identify its reportable segments. No changes to the operating segments were determined necessary during the three months ended March 31, 2025.
The Consumer Banking segment is mainly comprised of residential mortgages and automobile loans, and to a lesser extent, secured personal lines of credit, home equity loans and other consumer loans. The duration of the residential mortgage loan portfolio is subject to movements in the market level of interest rates and forecasted prepayment speeds. The average weighted life of the automobile loans within the portfolio is relatively unaffected by movements in the market level of interest rates. However, the average life may be impacted by new loans as a result of the availability of credit within the automobile marketplace and consumer demand for purchasing new or used automobiles. Consumer Banking also includes the Wealth Management and Insurance Services Division, comprised of asset management advisory, brokerage, trust, personal and title insurance, tax credit advisory services, and international and domestic private banking businesses.
The Commercial Banking segment is comprised of floating rate and adjustable rate commercial and industrial loans and construction loans, as well as adjustable and fixed rate owner occupied and commercial real estate loans. Due to the portfolio’s interest rate characteristics, Commercial Banking is Valley’s operating segment that is most sensitive to movements in market interest rates.
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Treasury and Corporate Other largely consists of the Treasury managed HTM debt securities and AFS debt securities portfolios mainly utilized in the liquidity management needs of our lending segments and income and expense items resulting from support functions not directly attributable to a specific segment. Interest income is generated through investments in various types of securities (mainly comprised of fixed rate securities) and interest-bearing deposits with other banks (primarily the Federal Reserve Bank of New York). Expenses related to the branch network, all other components of retail banking, along with the back office departments of the Bank are allocated from Treasury and Corporate Other to operating segments. Other non-interest income items and general expenses are allocated from Treasury and Corporate Other to each operating segment utilizing a methodology that involves an allocation of operating and funding costs based on each segment's respective mix of average interest earning assets outstanding for the period, number of deposits, or direct allocation to the segments based on the nature of income and expense. Unallocated items included in Treasury and Corporate Other consist of net gains and losses on AFS and HTM securities transactions, amortization of tax credit investments, as well as other non-core items, including merger, restructuring and FDIC special assessment charges and income from litigation settlements.
The accounting for each operating segment and Treasury and Corporate Other includes internal accounting policies designed to measure consistent and reasonable financial reporting and may result in income and expense measurements that differ from amounts under GAAP. The financial reporting for each segment contains allocations and reporting in line with Valley’s operations, which may not necessarily be comparable to any other financial institution. Furthermore, changes in management structure or allocation methodologies and procedures may result in changes in reported segment financial data. Certain prior period amounts have been reclassified to conform to the current presentation for each operating segment and Treasury and Corporate Other.
The following tables represent the financial data for Valley’s operating segments and Treasury and Corporate Other for the three months ended March 31, 2025 and 2024:
  Three Months Ended March 31, 2025
  Consumer
Banking		 Commercial
Banking		 Treasury and Corporate Other Total
  ($ in thousands)
Average interest earning assets
$ 10,210,226  $ 38,444,695  $ 8,236,770 $ 56,891,691 
Interest income $ 122,463  $ 579,896  $ 82,393 $ 784,752 
Interest expense 65,442  246,411  52,794 364,647 
Net interest income 57,021  333,485  29,599 420,105 
Provision (credit) for credit losses (8,733) 71,408  (14) 62,661 
Net interest income after provision for credit losses 65,754  262,077  29,613 357,444 
Non-interest income 34,354  19,002  4,938 58,294 
Non-interest expense
Salary and employee benefits expense 31,974  102,990  7,654 142,618 
Net occupancy expense 4,705  17,457  3,726 25,888 
Technology, furniture, and equipment expense 6,237  19,853  3,806 29,896 
FDIC insurance assessment 2,700  10,167  — 12,867 
Professional and legal fees 2,899  10,943  1,828 15,670 
Other segment items * 14,286  15,443  19,950 49,679 
Total non-interest expense $ 62,801  $ 176,853  $ 36,964  $ 276,618 
Income (loss) before income taxes $ 37,307  $ 104,226  $ (2,413) $ 139,120 
Return on average interest earning assets (pre-tax)
1.46  % 1.08  % (0.12) % 0.98  %
Net interest margin 2.24  % 3.47  % 1.44  % 2.95  %
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  Three Months Ended March 31, 2024
  Consumer
Banking		 Commercial
Banking		 Treasury and Corporate Other Total
  ($ in thousands)
Average interest earning assets
$ 9,796,681  $ 40,449,910  $ 6,372,206 $ 56,618,797 
Interest income $ 113,762  $ 657,791  $ 57,103 $ 828,656 
Interest expense 75,286  310,852  48,970 435,108 
Net interest income 38,476  346,939  8,133 393,548 
Provision (credit) for credit losses 3,072  42,202  (74) 45,200 
Net interest income after provision for credit losses 35,404  304,737  8,207 348,348 
Non-interest income 33,165  23,130  5,120 61,415 
Non-interest expense
Salary and employee benefits expense 28,658  101,858  11,315 141,831 
Net occupancy expense 4,268  17,363  2,692 24,323 
Technology, furniture, and equipment expense 6,537  25,264  3,661 35,462 
FDIC insurance assessment 2,114  8,728  7,394 18,236 
Professional and legal fees 2,827  12,082  1,556 16,465 
Other segment items * 12,591  13,203  18,199 43,993 
Total non-interest expense $ 56,995  $ 178,498  $ 44,817  $ 280,310 
Income (loss) before income taxes $ 11,574  $ 149,369  $ (31,490) $ 129,453 
Return on average interest earning assets (pre-tax)
0.47  % 1.48  % (1.98) % 0.91  %
Net interest margin 1.57  % 3.43  % 0.51  % 2.78  %
* Other segment items include amortization of intangible assets, amortization of tax credit investments and other general operating expenses.
 
Item 2. Management’s Discussion and Analysis (MD&A) of Financial Condition and Results of Operations
The following MD&A should be read in conjunction with the consolidated financial statements and notes thereto appearing in Part I, Item 1 of this report. The MD&A contains supplemental financial information, described in the sections that follow, which has been determined by methods other than GAAP that management uses in its analysis of our performance. Management believes these non-GAAP financial measures provide information useful to investors in understanding our underlying operational performance, our business and performance trends and facilitate comparisons with the performance of others in the financial services industry. These non-GAAP financial measures should not be considered in isolation, as a substitute for or superior to financial measures calculated in accordance with GAAP. These non-GAAP financial measures may also be calculated differently from similar measures disclosed by other companies.
Cautionary Statement Concerning 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 our business, new and existing programs and products, acquisitions, relationships, opportunities, taxation, technology, market conditions and economic expectations. These statements may be identified by such forward-looking terminology as “intend,” “should,” “expect,” “believe,” “view,” “opportunity,” “allow,” “continues,” “reflects,” “would,” “could,” “typically,” “usually,” “anticipate,” “may,” “estimate,” “outlook,” “project” or similar statements or variations of such terms. Such forward-looking statements involve certain risks and uncertainties. Actual results may differ materially from such forward-looking statements.
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Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, but are not limited to:
•the impact of market interest rates and monetary and fiscal policies of the U.S. federal government and its agencies in connection with prolonged inflationary pressures, which could have a material adverse effect on our clients, our business, our employees, and our ability to provide services to our customers;
•the impact of unfavorable macroeconomic conditions or downturns, including instability or volatility in financial markets resulting from the impact of tariffs, any retaliatory actions, related market uncertainty, or other factors; debt default or rating downgrade; unanticipated loan delinquencies; loss of collateral; decreased service revenues; increased business disruptions or failures; reductions in employment; and other potential negative effects on our business, employees or clients caused by factors outside of our control, such as legislation and policy changes under the new U.S. presidential administration, geopolitical instabilities or events, natural and other disasters, including severe weather events, health emergencies, acts of terrorism, or other external events;
•the impact of any potential instability within the U.S. financial sector or future bank failures, including the possibility of a run on deposits by a coordinated deposit base, and the impact of the actual or perceived soundness, or concerns about the creditworthiness, of other financial institutions, including any resulting disruption within the financial markets, increased expenses, including FDIC insurance assessments, or adverse impact on our stock price, deposits or our ability to borrow or raise capital;
•the impact of negative public opinion regarding Valley or banks in general that damages our reputation and adversely impacts business and revenues;
•changes in the statutes, regulations, policies, or enforcement priorities of the federal bank regulatory agencies;
•the loss of or decrease in lower-cost funding sources within our deposit base;
•damage verdicts or settlements or restrictions related to existing or potential class action litigation or individual litigation arising from claims of violations of laws or regulations, contractual claims, breach of fiduciary responsibility, negligence, fraud, environmental laws, patent, trademark or other intellectual property infringement, misappropriation or other violation, employment related claims, and other matters;
•a prolonged downturn and contraction in the economy, as well as an unexpected decline in commercial real estate values collateralizing a significant portion of our loan portfolio;
•higher or lower than expected income tax expense or tax rates, including increases or decreases resulting from changes in uncertain tax position liabilities, tax laws, regulations, and case law;
•the inability to grow customer deposits to keep pace with the level of loan growth;
•a material change in our allowance for credit losses under CECL due to forecasted economic conditions and/or unexpected credit deterioration in our loan and investment portfolios;
•the need to supplement debt or equity capital to maintain or exceed internal capital thresholds;
•changes in our business, strategy, market conditions or other factors that may negatively impact the estimated fair value of our goodwill and other intangible assets and result in future impairment charges;
•greater than expected technology-related costs due to, among other factors, prolonged or failed implementations, additional project staffing and obsolescence caused by continuous and rapid market innovations;
•increased competitive challenges, including our ability to stay current with rapid technological changes in the financial services industry;
•cyberattacks, ransomware attacks, computer viruses, malware or other cybersecurity incidents that may breach the security of our websites or other systems or networks to obtain unauthorized access to personal, confidential, proprietary or sensitive information, destroy data, disable or degrade service, or sabotage our systems or networks, and the increasing sophistication of such attacks;
•results of examinations by the OCC, the FRB, the CFPB and other regulatory authorities, including the possibility that any such regulatory authority may, among other things, require us to increase our allowance for credit losses, write-down assets, reimburse customers, change the way we do business, or limit or eliminate certain other banking activities;
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•application of the OCC heightened regulatory standards for certain large insured national banks, and the expenses we will incur to develop policies, programs, and systems that comply with the enhanced standards applicable to us;
•our inability or determination not to pay dividends at current levels, or at all, because of inadequate earnings, regulatory restrictions or limitations, changes in our capital requirements, or a decision to increase capital by retaining more earnings;
•unanticipated loan delinquencies, loss of collateral, decreased service revenues, and other potential negative effects on our business caused by severe weather, pandemics or other public health crises, acts of terrorism or other external events;
•our ability to successfully execute our business plan and strategic initiatives; and
•unexpected significant declines in the loan portfolio due to the lack of economic expansion, increased competition, large prepayments, risk mitigation strategies, changes in regulatory lending guidance or other factors.
A detailed discussion of factors that could affect our results is included in our SEC filings, including Item 1A. "Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2024.
We undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in our expectations, except as required by law. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

Critical Accounting Estimates
Valley’s accounting policies are fundamental to understanding management’s discussion and analysis of its financial condition and results of operations. In preparing the consolidated financial statements, management has made estimates, judgments and assumptions in accordance with these policies that affect the reported amounts of assets and liabilities as of the date of the consolidated statements of financial condition and results of operations for the periods indicated. At March 31, 2025, we identified our policies on the allowance for credit losses, goodwill and other intangible assets, and income taxes to be critical accounting policies because management has to make subjective and/or complex judgments about matters that are inherently uncertain and because it is likely that materially different amounts would be reported under different conditions or using different assumptions. Management has reviewed the application of these policies and estimates with the Audit Committee of Valley’s Board. Our critical accounting policies and estimates are described in detail in Part II, Item 7 in Valley’s Annual Report, and there have been no material changes in such policies and estimates since the date of Valley’s Annual Report.
New Authoritative Accounting Guidance
See Note 4 to the consolidated financial statements for a description of new authoritative accounting guidance, including the dates of adoption and effects on results of operations and financial condition.
Executive Summary
Company Overview. At March 31, 2025, Valley had consolidated total assets of approximately $61.9 billion, total net loans of $48.1 billion, total deposits of $50.0 billion and total shareholders’ equity of $7.5 billion. Valley operates many convenient branch office locations and commercial banking offices in northern and central New Jersey, the New York City boroughs of Manhattan, Brooklyn and Queens, Long Island, Westchester County, New York, Florida, California, Alabama, and Illinois. Of our current 229 branch network, 55 percent, 18 percent, and 18 percent of the branches are located in New Jersey, New York, and Florida, respectively, with the remaining 9 percent of the branches in Alabama, California, and Illinois combined.
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Financial Condition. During the first quarter 2025, we continued to strengthen our balance sheet to best perform in the current uncertain economic environment, while also prudently managing and reducing the overall risk of our loan portfolio. The following items, including key balance sheet initiatives, are highlights at March 31, 2025.
•Commercial Real Estate Loan Concentration: Total commercial real estate loans (including construction loans) totaled $29.1 billion, or 59.8 percent of total loans at March 31, 2025 as compared to $29.6 billion, or 60.7 percent of total loans at December 31, 2024. The decrease was mostly due to normal repayment activity and selective originations as we continue to proactively diversify our loan portfolio by reducing new originations of certain types of transactional commercial real estate lending, such as non-owner occupied and multifamily loans to single-product borrowers. As a result, our CRE loan concentration ratio declined to approximately 353 percent at March 31, 2025 from 362 percent at December 31, 2024. Our current balance sheet goal is to reduce CRE concentration ratio to below 350 percent by December 31, 2025. See further details of our loan activities under the “Loan Portfolio” section below.
•Regulatory Capital and Shareholders' Equity: Total shareholders' equity increased $64.8 million to $7.5 billion at March 31, 2025 as compared to December 31, 2024. Valley's total risk-based capital, common equity Tier 1 capital, Tier 1 capital and Tier 1 leverage capital ratios were 13.91 percent, 10.80 percent, 11.53 percent, and 9.41 percent, respectively, at March 31, 2025 as compared to 13.87 percent, 10.82 percent, 11.55 percent and 9.16 percent, respectively, at December 31, 2024. Currently, we expect that Valley's common equity Tier 1 capital will gradually increase to approximately 11 percent by December 31, 2025 largely through projected growth in our retained earnings and continuous management of the overall regulatory risk weighted asset profile of our balance sheet, including the goal to reduce our commercial real estate loan concentration. See the "Capital Adequacy" section below for more information.
•Allowance for Credit Losses for Loans: The ACL for loans totaled $594.1 million and $573.3 million at March 31, 2025 and December 31, 2024, respectively, representing 1.22 percent and 1.17 percent of total loans at each respective date. The increase reflects, among other factors, an increase in quantitative reserves and continued growth in the commercial and industrial loan portfolio. Given our current projections for continued growth in our commercial and industrial loan portfolio and credit trends within our loan portfolio, we anticipate the ACL could continue to migrate towards approximately 1.25 percent of total loans by December 31, 2025. See the “Allowance for Credit Losses" section for additional information.
•Credit Quality: Total accruing past due loans (i.e., loans past due 30 days or more and still accruing interest) decreased $47.5 million to $51.7 million, or 0.11 percent of total loans, at March 31, 2025 as compared to $99.2 million, or 0.20 of total loans, at December 31, 2024. Non-accrual loans totaled $346.5 million, or 0.71 percent of total loans, at March 31, 2025 as compared to $359.5 million, or 0.74 percent of total loans, at December 31, 2024. See the “Non-Performing Assets” section for additional information.
•Liquid Assets: Our liquid assets totaled $5.1 billion at March 31, 2025, representing 9.1 percent of interest earning assets as compared with $5.5 billion, or 9.6 percent of interest earning assets at December 31, 2024. We continue to maintain significant access to readily available, diverse funding sources to fulfill both short-term and long-term funding needs. See the “Bank Liquidity” section for additional information.
•Deposits: Non-interest bearing deposits increased $199.9 million to $11.6 billion at March 31, 2025 from December 31, 2024 largely due to higher inflows of commercial customer deposits during the first quarter 2025. Savings, NOW, and money market deposits increased $108.6 million to $26.4 billion at March 31, 2025 from December 31, 2024 mostly due to new deposits from our online savings deposit product offerings. Total actual deposit balances decreased $110.0 million to $50.0 billion at March 31, 2025 as compared to $50.1 billion at December 31, 2024 as the increases in our direct customer deposits were offset by a $726.5 million decrease in indirect customer deposits (consisting largely of brokered CDs) during the first quarter 2025. See the "Deposits" section below for more details.
•Investment Securities: Total investment securities increased $305.6 million to $7.3 billion, or 11.8 percent of total assets, at March 31, 2025 as compared to December 31, 2024 mainly due to targeted purchases of residential mortgage backed securities primarily issued by Ginnie Mae (with a risk-weighting of zero for
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regulatory capital purposes) that were classified as AFS. See the “Investment Securities Portfolio” section for more details.
Quarterly Results. Net income for the first quarter 2025 was $106.1 million, or $0.18 per diluted common share, as compared to $96.3 million, or $0.18 per diluted common share, for the first quarter 2024. The $9.8 million increase in quarterly net income as compared to the same quarter one year ago was mainly due to the following changes:
•a $26.6 million increase in net interest income mainly driven by lower interest rates on most interest bearing deposit products in the first quarter 2025 and additional interest income from investment security purchases, partially offset by lower yields on adjustable-rate loans; and
•a $3.7 million decrease in non-interest expense primarily due to decreases in technology, furniture and equipment expense and FDIC assessment fees, largely offset by higher amortization of tax credit investments and other expense;
Which were partially offset by:
•a $17.5 million increase in our provision for credit losses largely due to higher quantitative reserves allocated to commercial real estate loans, significant growth within the commercial and industrial loan category and the impact of loan charge-offs; and
•a $3.1 million decrease in non-interest income that was mainly driven by lower gains on sales of assets and decreases in tax advisory fees (within wealth management and trust fees) and other income, partially offset by moderate increases in several other categories.
See the “Net Interest Income,” “Non-Interest Income,” “Non-Interest Expense” and “Income Taxes” sections below for more details on the impact of the items above and other infrequent non-core items impacting our first quarter 2025 results.
U.S. Economic Conditions. During the first quarter 2025, real gross GDP decreased at an estimated annual rate of 0.3 percent as compared to an increase of 2.5 percent during the fourth quarter 2024. The contraction in GDP was primarily driven by a significant increase in imports likely caused by businesses and consumers stockpiling goods before potential tariffs take effect, as well as a reduction in government spending. These movements were partially offset by increases in investment, consumer spending and net exports. In addition, most measures of inflation continued to reflect a moderation in price pressures during the first quarter 2025. The rate of inflation declined to 2.4 percent in the first quarter 2025 as compared to 2.9 percent for the fourth quarter 2024.
Over the last four months of 2024 at its Federal Open Market Committee meetings, the Federal Reserve lowered the target range for the federal funds rate from 5.25 – 5.50 percent to 4.25 – 4.50 percent. The latest projections from the Committee’s last meeting in March indicate two rate cuts in 2025. With inflation remaining somewhat elevated in recent months, unpredictability regarding U.S. government tariff plans, and overall uncertainty around the economic outlook, the Committee held rates steady in March 2025. Additionally, the Committee indicated it will slow the pace of its securities runoff to $5 billion per month starting in April, down from its prior reductions of $25 billion per month.
The 10-year U.S. Treasury note yield ended the first quarter 2025 at 4.23 percent, or 35 basis points lower as compared to the fourth quarter 2024, and the 2-year U.S. Treasury note yield ended the first quarter 2025 at 3.89 percent, or 36 basis points lower as compared to the fourth quarter 2024.
For all commercial banks in the U.S., total loans and leases grew 1.0 percent from December 31, 2024 to March 31, 2025. Commercial and industrial lending decreased 0.3 percent and commercial real estate lending increased 0.4 percent during the same period. For the first quarter of 2025, banks reported continued easing of underwriting standards for most commercial and industrial loan products, as well as commercial real estate loans. Banks reported a continued increase in demand for commercial and industrial loans and a modest increase in demand for commercial real estate loans, as investor activity picked up in the first quarter 2025 due to the decline in market interest rates.
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Entering the first quarter of 2025, there was a general sense of an economic recovery and improving operating environment, and the Federal Reserve started to see modest progress in their efforts to combat inflation. However, more recent economic and political developments, such as new tariff policies, strict immigration enforcement, government spending cuts, a potentially weakening job market, continued elevated market interest rates, and ongoing geopolitical conflicts has weakened the current economic outlook. As a result of these factors, many market analysts have increased the likelihood of a recession in the coming year in their forecasts, and foresee an overall challenging bank operating environment. Should these conditions persist or further deteriorate, they may adversely impact our banking clients and our financial results, as highlighted elsewhere in this MD&A.
Deposits and Other Borrowings
We define cumulative deposit beta as the change in our cost of total deposits relative to the change in the average Fed Funds (upper bound) rate. We differentiate between the cumulative deposit beta during the rate increase cycle, which began in the first quarter of 2022 and ended in the second quarter of 2024, and the cumulative deposit beta during the rate decrease cycle which started in the third quarter of 2024. Our cumulative deposit beta in the interest rate increase cycle (between December 31, 2021 and June 30, 2024) was approximately 58 percent. The Federal Reserve started an interest rate decrease cycle during the third quarter 2024. Our cumulative deposit beta in this current interest rate decrease cycle (between June 30, 2024 and March 31, 2025) was 53 percent as compared to 34 percent (between June 30, 2024 and December 31, 2024) one quarter ago. The continued increase of our cumulative deposit beta in the first quarter 2025 was mainly driven by a full quarter’s impact of the Federal Reserve's rate cuts in November and December 2024, and our ability to broadly reduce costs of interest bearing deposit products coupled with a reduction of higher cost indirect customer CDs. See the "Net Interest Income" section for additional details on the changes in our cost of deposits during the first quarter 2025.
Total average deposits decreased by $1.6 billion to $49.1 billion for the first quarter 2025 as compared to the fourth quarter 2024. Average time deposits balances decreased $2.0 billion from the fourth quarter 2024 largely due to the maturity and repayment of higher cost indirect customer (i.e., brokered) CDs, partially offset by new direct retail customer CDs during the first quarter 2025. Average savings, NOW and money market deposits increased $417.8 million to $26.3 billion for the first quarter 2025 as compared to the fourth quarter 2024. Average non-interest-bearing deposits; savings, NOW and money market deposits; and time deposits represented approximately 23 percent, 54 percent, and 24 percent of total deposits for the first quarter 2025, respectively, as compared to 22 percent, 51 percent, and 27 percent of total deposits for the fourth quarter 2024, respectively.
Actual ending balances for deposits decreased $110.0 million to $50.0 billion at March 31, 2025 from December 31, 2024 mainly due to a $418.5 million decrease in time deposits, partially offset by increases of $199.9 million and $108.6 million in non-interest bearing deposits and savings, NOW and money market deposits, respectively. The decrease in time deposit balances was mainly driven by a decline of approximately $661 million in indirect customer CDs, partially offset by deposit inflows from new retail CD offerings during the first quarter 2025. The increase in non-interest bearing was mostly due to higher commercial customer deposit inflows late in the first quarter 2025. Savings, NOW and money market deposit balances increased at March 31, 2025 from December 31, 2024 largely due to new deposits from our online savings deposit product offerings, partially offset by lower governmental deposits account balances. Total indirect customer deposits (including both brokered money market and time deposits) totaled $6.3 billion and $7.0 billion in March 31, 2025 and December 31, 2024, respectively. Non-interest bearing deposits; savings, NOW and money market deposits; and time deposits represented approximately 23 percent, 53 percent, and 24 percent of total deposits as of March 31, 2025, respectively, as compared to 23 percent, 52 percent, and 25 percent of total deposits as of December 31, 2024, respectively.



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The following table summarizes CDs included in time deposits in excess of the FDIC insurance limit by maturity at March 31, 2025:
March 31, 2025
  (in thousands)
Less than three months $ 914,809 
Three to six months 572,701 
Six to twelve months 757,780 
More than twelve months 133,083 
Total $ 2,378,373 
Total estimated uninsured deposits, excluding collateralized government deposits and intercompany deposits (i.e., deposits eliminated in consolidation), totaled approximately $13.0 billion, or 26 percent of total deposits, at March 31, 2025 as compared to $12.6 billion, or 25 percent of total deposits, at December 31, 2024.
While we maintained a diversified commercial and consumer deposit base at March 31, 2025, deposit gathering initiatives and our current direct customer deposit base could be challenged due to market competition, attractive non-deposit investment alternatives in the financial markets and other factors. As a result, we cannot guarantee that we will be able to maintain deposit levels at or near those reported at March 31, 2025. Management continuously monitors liquidity and all available funding sources including non-deposit borrowings discussed below. See the “Liquidity and Cash Requirements” section of this MD&A for additional information.
The following table presents average short-term and long-term borrowings for the periods indicated:
Three Months Ended
March 31, 2025 December 31, 2024 March 31, 2024
(in thousands)
Average short-term borrowings:
FHLB advances $ 241,944  $ 6,087  $ 1,470,879 
Securities sold under repurchase agreements 60,693  65,221  67,000 
Federal funds purchased 5,000  1,196  — 
Total $ 307,637  $ 72,504  $ 1,537,879 
Average long-term borrowings:
FHLB advances $ 2,300,093  $ 2,529,895  $ 1,930,702 
Subordinated debt 648,738  646,957  638,008 
Junior subordinated debentures issued to capital trusts 57,500  57,412  57,152 
Total $ 3,006,331  $ 3,234,264  $ 2,625,862 
Average short-term borrowings increased by $235.1 million and decreased $1.2 billion during the first quarter 2025 as compared to the fourth quarter 2024 and first quarter 2024, respectively. The decrease from the first quarter 2024 was mostly driven by a shift from the use of short-term FHLB advances to primarily indirect customer deposits in our average mix of funding sources since the second quarter 2024.
Average long-term borrowings (including junior subordinated debentures issued to capital trusts which are presented separately on the consolidated statements of financial condition) decreased $227.9 million as compared to the fourth quarter 2024 and increased $380.5 million as compared to the first quarter 2024. The increase as compared to the first quarter 2024 was partly due to new FHLB advances totaling $1.0 billion issued in early March 2024, partially offset by the maturity and repayment of $273 million of FHLB advances in January 2025.
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Actual ending balances for short-term borrowings, consisting of securities sold under agreements to repurchase, decreased $13.7 million to $59.0 million at March 31, 2025 from December 31, 2024. Long-term borrowings totaled $2.9 billion at March 31, 2025 and decreased $269.6 million as compared to December 31, 2024 due to the aforementioned repayment of FHLB advances in January 2025.
Non-GAAP Financial Measures
The table below presents selected performance indicators, their comparative non-GAAP measures and the (non-GAAP) efficiency ratio for the periods indicated. Valley believes that the non-GAAP financial measures provide useful supplemental information to both management and investors in understanding Valley's underlying operational performance, business, and performance trends, and may facilitate comparisons of our current and prior performance with the performance of others in the financial services industry. Management utilizes these measures for internal planning, forecasting, and analysis purposes. Management believes that Valley’s presentation and discussion of this supplemental information, together with the accompanying reconciliations to the GAAP financial measures, also allows investors to view performance in a manner similar to management. These non-GAAP financial measures should not be considered in isolation, as a substitute for or superior to financial measures calculated in accordance with GAAP. These non-GAAP financial measures may also be calculated differently from similar measures disclosed by other companies.
The following table presents our annualized performance ratios:
  Three Months Ended
March 31,
  2025 2024
Selected Performance Indicators ($ in thousands)
GAAP measures:
Net income, as reported $ 106,058  $ 96,280 
Return on average assets 0.69  % 0.63  %
Return on average shareholders’ equity 5.69  5.73 
Non-GAAP measures:
Net income, as adjusted $ 106,066  $ 99,448 
Return on average assets, as adjusted 0.69  % 0.65  %
Return on average shareholders' equity, as adjusted 5.69  5.91 
Return on average tangible shareholders' equity (ROATE) 7.76  8.19 
ROATE, as adjusted 7.76  8.46 
Efficiency ratio, as adjusted 55.87  59.10 
March 31,
2025		 December 31,
2024
Common Equity Per Share Data:
Book value per common share (GAAP) $ 12.76  $ 12.67 
Tangible book value per common share (non-GAAP) 9.21  9.10 


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Non-GAAP Reconciliations to GAAP Financial Measures
Adjusted net income is computed as follows:
Three Months Ended
March 31,
2025 2024
(in thousands)
Net income, as reported (GAAP) $ 106,058  $ 96,280 
Non-GAAP adjustments:
Add: FDIC special assessment (1)
 —  7,394 
Add: Losses on available for sale and held to maturity debt securities, net (2)
 11  7 
Less: Restructuring charge (3)
 —  620 
Less: Gain on sale of commercial premium finance lending division (4)
 —  (3,629)
Total non-GAAP adjustments to net income $ 11  $ 4,392 
Income tax adjustments related to non-GAAP adjustments (5)
 (3) (1,224)
Net income, as adjusted (non-GAAP) $ 106,066  $ 99,448 
(1)
 Included in the FDIC insurance assessment.
(2)
 Included in gains on securities transactions, net.
(3)
 Represents severance expense related to workforce reductions within salary and employee benefits expense.
(4)
 Included in gains on sales of assets, net.
(5)
 Calculated using the appropriate blended statutory tax rate for the applicable period.
In addition to the items used to calculate net income, as adjusted, in the table above, our net income is, from time to time, impacted by fluctuations in the overall level of net gains on sales of loans, wealth management and trust fees, and capital markets fees. These amounts can vary widely from period to period due to, among other factors, the amount and timing of residential mortgage loans originated for sale, brokerage and tax credit investment advisory activities and commercial loan customer demand for certain interest rate swap products. See the “Non-Interest Income” section below for more details.
Adjusted annualized return on average assets is computed by dividing adjusted net income by average assets, as follows:
Three Months Ended
March 31,
2025 2024
($ in thousands)
Net income, as adjusted (non-GAAP) $ 106,066 $ 99,448
Average assets (GAAP) $ 61,502,768 $ 61,256,868
Annualized return on average assets, as adjusted (non-GAAP) 0.69  % 0.65  %

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Adjusted annualized return on average shareholders' equity is computed by dividing adjusted net income by average shareholders' equity, as follows:
Three Months Ended
March 31,
2025 2024
($ in thousands)
Net income, as adjusted (non-GAAP) $ 106,066 $ 99,448
Average shareholders' equity (GAAP) $ 7,458,177 $ 6,725,695
Annualized return on average shareholders' equity, as adjusted (non-GAAP) 5.69  % 5.91  %
ROATE and adjusted ROATE are computed by dividing net income and adjusted net income, respectively, by average shareholders’ equity less average goodwill and average other intangible assets, as follows:
  Three Months Ended
March 31,
  2025 2024
  ($ in thousands)
Net income, as reported (GAAP) $ 106,058 $ 96,280
Net income, as adjusted (non-GAAP) $ 106,066 $ 99,448
Average shareholders’ equity (GAAP) $ 7,458,177 $ 6,725,695
Less: Average goodwill and other intangible assets (GAAP) 1,994,061 2,024,999
Average tangible shareholders’ equity (non-GAAP) $ 5,464,116 $ 4,700,696
Annualized ROATE (non-GAAP) 7.76  % 8.19  %
Annualized ROATE, as adjusted (non-GAAP) 7.76  % 8.46  %
The efficiency ratio is computed as follows:
  Three Months Ended
March 31,
  2025 2024
  ($ in thousands)
Total non-interest expense, as reported (GAAP) $ 276,618  $ 280,310 
Less: FDIC special assessment (1)
 —  7,394 
Less: Restructuring charge (2)
 —  620 
Less: Amortization of tax credit investments 9,320  5,562 
Total non-interest expense, as adjusted (non-GAAP) $ 267,298  $ 266,734 
Net interest income, as reported (GAAP) 420,105  393,548 
Total non-interest income, as reported (GAAP) 58,294  61,415 
Add: Losses on available for sale and held to maturity debt securities, net (3)
 11  7 
Less: Gain on sale of commercial premium finance lending division (4)
 —  (3,629)
Gross operating income, as adjusted (non-GAAP) $ 478,410  $ 451,341 
Efficiency ratio (non-GAAP) 55.87  % 59.10  %
(1)
 Included in the FDIC insurance expense.
(2)
Represents severance expense related to workforce reductions within salary and employee benefits expense.
(3)
Included in gains on securities transactions, net.
(4)
 Included in gains on sales of assets, net.
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Tangible book value per common share is computed by dividing shareholders’ equity less preferred stock, goodwill and other intangible assets by common shares outstanding, as follows: 
March 31,
2025		 December 31,
2024
  ($ in thousands, except for share data)
Common shares outstanding 560,028,101  558,786,093 
Shareholders’ equity (GAAP) $ 7,499,897  $ 7,435,127 
Less: Preferred stock 354,345  354,345 
Less: Goodwill and other intangible assets 1,990,276  1,997,597 
Tangible common shareholders’ equity (non-GAAP) $ 5,155,276  $ 5,083,185 
Book value per common share (GAAP) $ 12.76  $ 12.67 
Tangible book value per common share (non-GAAP) $ 9.21  $ 9.10 
Net Interest Income
Net interest income on a tax equivalent basis of $421.4 million for the first quarter 2025 decreased $2.9 million compared to the fourth quarter 2024 and increased $26.5 million as compared to the first quarter 2024. Interest income on a tax equivalent basis decreased $50.1 million to $786.0 million for the first quarter 2025 as compared to the fourth quarter 2024. The decrease was mostly driven by the impact of (i) two less days in the first quarter 2025, (ii) the bulk sale of certain performing CRE loans during the fourth quarter 2024, and (iii) downward repricing on adjustable rate loans. Total interest expense decreased $47.2 million to $364.6 million for the first quarter 2025 as compared to the fourth quarter 2024 mainly due to (i) the aforementioned reduction in day count, (ii) a $2.0 billion decrease in average time deposit balances (primarily related to the maturity and repayment of higher cost indirect customer CDs) and (iii) lower interest rates on many interest bearing deposit products in the first quarter 2025.
Average interest earning assets increased $272.9 million to $56.9 billion for the first quarter 2025 as compared to the first quarter 2024 mainly due to a $2.0 billion increase in average taxable investments largely resulting from purchases of residential mortgage-backed securities classified as available for sale over the past 12 months, largely offset by lower average loan balances. Compared to the fourth quarter 2024, average interest earning assets decreased by $1.3 billion during the first quarter 2025. The decrease was mainly driven by decreases of $1.1 billion and $831.1 million in average loans and overnight interest bearing cash balances, respectively, partially offset by an increase of $596.9 million in average taxable investments. The decrease in average loan balances to $48.7 billion for the first quarter 2025 was mostly due to the bulk sale of certain performing CRE loans during the fourth quarter 2024 and continued CRE loan repayment activity. The decline in average overnight interest bearing cash balances was largely the result of excess funds from both loan sales and issuance of common stock in the fourth quarter 2024 used, in part, to repay maturing indirect customer time deposits and purchase taxable investment securities in the first quarter 2025.
Average interest bearing liabilities decreased $325.9 million to $41.2 billion for the first quarter 2025 as compared to the first quarter 2024 primarily due to a decrease of $1.2 billion in average short-term borrowings, partially offset by increases of $523.9 million and $380.5 million in average interest bearing deposits and long-term borrowings, respectively. The $1.2 billion decrease in average short-term borrowings was mostly the result of a shift from the use of short-term FHLB advances to indirect customer time deposits in our mix of liquidity funding sources starting in the second quarter 2024. As compared to the fourth quarter 2024, average interest bearing liabilities decreased by $1.5 billion for the first quarter 2025 largely due to a decrease in average time deposit balances caused by the aforementioned repayment of maturing indirect customer time deposits. See additional information under “Deposits and Other Borrowings” in the Executive Summary section above.
Net interest margin on a tax equivalent basis of 2.96 percent for the first quarter 2025 increased by 4 basis points from 2.92 percent for the fourth quarter 2024 and increased 17 basis points from 2.79 percent for the first quarter 2024. The increase as compared to the fourth quarter 2024 was mostly due to the 29 basis point decline in our cost of total average deposits, largely offset by the lower yield on average interest earning assets.
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The yield on average interest earning assets decreased by 22 basis points to 5.53 percent on a linked quarter basis largely due to downward repricing of our adjustable rate loans and two less days in the first quarter 2025, partially offset by higher yielding investment purchases. The overall cost of average interest bearing liabilities decreased 31 basis points to 3.54 percent for the first quarter 2025 as compared to the fourth quarter 2024 largely due to a decrease in higher cost time deposits and lower interest rates on most deposit products. Our cost of total average deposits was 2.65 percent for the first quarter 2025 as compared to 2.94 percent and 3.16 percent for the fourth quarter 2024 and the first quarter 2024, respectively.
In Valley's Annual Report, we provided guidance that we anticipated net interest income growth of approximately 9 to 12 percent for the full year of 2025 as compared to $1.6 billion reported for 2024. Based upon our current projections, we now expect the growth of our net interest income for 2025 to fall within the low-end of the 9 to 12 percent range largely due to lower anticipated loan growth and continued lending spread compression. Our forecasts include additional assumptions and, therefore, we cannot provide any assurances that our future net interest income or margin will meet our current estimates or remain near the levels reported for the first quarter 2025. For a detailed discussion on the risks related to interest rates please refer to Part I, Item 1A. “Risk Factors” in Valley's Annual Report.
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The following table reflects the components of net interest income for the three months ended March 31, 2025, December 31, 2024 and March 31, 2024:

Quarterly Analysis of Average Assets, Liabilities and Shareholders’ Equity and
Net Interest Income on a Tax Equivalent Basis
  Three Months Ended
  March 31, 2025 December 31, 2024 March 31, 2024
  Average
Balance		 Interest Average
Rate		 Average
Balance		 Interest Average
Rate		 Average
Balance		 Interest Average
Rate
  ($ in thousands)
Assets
Interest earning assets:
Loans (1)(2)
 $ 48,654,921  $ 703,632  5.78  % $ 49,730,130  $ 750,690  6.04  % $ 50,246,591  $ 771,577  6.14  %
Taxable investments (3)
 7,100,958  69,562  3.92  6,504,106  61,843  3.80  5,094,978  42,625  3.35 
Tax-exempt investments (1)(3)
 552,291  5,952  4.31  565,877  6,080  4.30  579,842  6,071  4.19 
Interest bearing deposits with banks 583,521  6,879  4.72  1,414,670  17,513  4.95  697,386  9,682  5.55 
Total interest earning assets 56,891,691  786,025  5.53  58,214,783  836,126  5.75  56,618,797  829,955  5.86 
Allowance for credit losses (577,551) (551,304) (450,331)
Cash and due from banks 418,806  427,777  439,176 
Other assets 4,950,547  4,886,157  4,805,001 
Unrealized gains (losses) on securities available for sale, net (180,725) (112,075) (155,775)
Total assets $ 61,502,768  $ 62,865,338  $ 61,256,868 
Liabilities and Shareholders’ Equity
Interest bearing liabilities:
Savings, NOW and money market deposits $ 26,345,983  $ 200,221  3.04  % $ 25,928,201  $ 214,489  3.31  % $ 24,793,452  $ 232,506  3.75  %
Time deposits 11,570,758  125,069  4.32  13,530,980  158,716  4.69  12,599,395  151,065  4.80 
Total interest bearing deposits 37,916,741  325,290  3.43  39,459,181  373,205  3.78  37,392,847  383,571  4.10 
Short-term borrowings 307,637  2,946  3.83  72,504  293  1.62  1,537,879  20,612  5.36 
Long-term borrowings (4)
 3,006,331  36,411  4.84  3,234,264  38,351  4.74  2,625,862  30,925  4.71 
Total interest bearing liabilities 41,230,709  364,647  3.54  42,765,949  411,849  3.85  41,556,588  435,108  4.19 
Non-interest bearing deposits 11,222,562  11,266,899  11,183,127 
Other liabilities 1,591,320  1,577,331  1,791,458 
Shareholders’ equity 7,458,177  7,255,159  6,725,695 
Total liabilities and shareholders’ equity $ 61,502,768  $ 62,865,338  $ 61,256,868 
Net interest income/interest rate spread (5)
 $ 421,378  1.99  % $ 424,277  1.90  % $ 394,847  1.67  %
Tax equivalent adjustment (1,273) (1,300) (1,299)
Net interest income, as reported $ 420,105  $ 422,977  $ 393,548 
Net interest margin (6)
 2.95  % 2.91  % 2.78  %
Tax equivalent effect 0.01  0.01  0.01 
Net interest margin on a fully tax equivalent basis (6)
 2.96  % 2.92  % 2.79  %
_____________

(1)Interest income is presented on a tax equivalent basis using a 21 percent federal tax rate.
(2)Loans are stated net of unearned income and include non-accrual loans.
(3)The yield for securities that are classified as AFS is based on the average historical amortized cost.
(4)Includes junior subordinated debentures issued to capital trusts which are presented separately on the consolidated
statements of financial condition.
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(5)Interest rate spread represents the difference between the average yield on interest earning assets and the average cost of interest bearing liabilities and is presented on a fully tax equivalent basis.
(6)Net interest income as a percentage of total average interest earning assets.
The following table demonstrates the relative impact on net interest income of changes in the volume of interest earning assets and interest bearing liabilities and changes in rates earned and paid by Valley on such assets and liabilities. Variances resulting from a combination of changes in volume and rates are allocated to the categories in proportion to the absolute dollar amounts of the change in each category.
Change in Net Interest Income on a Tax Equivalent Basis
  Three Months Ended March 31, 2025
Compared to March 31, 2024
  Change
Due to
Volume		 Change
Due to
Rate		 Total
Change
  (in thousands)
Interest Income:
Loans* $ (23,940) $ (44,005) $ (67,945)
Taxable investments 18,782  8,155  26,937 
Tax-exempt investments* (294) 175  (119)
Federal funds sold and other interest bearing deposits (1,457) (1,346) (2,803)
Total decrease in interest income
 (6,909) (37,021) (43,930)
Interest Expense:
Savings, NOW and money market deposits 13,874  (46,159) (32,285)
Time deposits (11,783) (14,213) (25,996)
Short-term borrowings (13,019) (4,647) (17,666)
Long-term borrowings and junior subordinated debentures 4,587  899  5,486 
Total decrease in interest expense
 (6,341) (64,120) (70,461)
Total (decrease) increase in net interest income $ (568) $ 27,099  $ 26,531 
*Interest income is presented on a tax equivalent basis using 21 percent as the federal tax rate.
Non-Interest Income
Non-interest income represented 12.2 percent and 13.5 percent of total net interest income plus non-interest income for the three months ended March 31, 2025 and 2024, respectively. For the three months ended March 31, 2025, non-interest income decreased $3.1 million as compared to the same quarter in 2024 mainly driven by lower gains on sales of assets and decreases in wealth management and trust fees and other income, partially offset by moderate increases in several other categories. See further details below.
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The following table presents the components of non-interest income for the three months ended March 31, 2025 and 2024:
  Three Months Ended
March 31,
  2025 2024
  (in thousands)
Wealth management and trust fees $ 15,031  $ 17,930 
Insurance commissions 3,402  2,251 
Capital markets 6,940  5,670 
Service charges on deposit accounts 12,726  11,249 
Gains on securities transactions, net 46  49 
Fees from loan servicing 3,215  3,188 
Gains on sales of loans, net 2,197  1,618 
Gains on sales of assets, net 43  3,694 
Bank owned life insurance 4,777  3,235 
Other 9,917  12,531 
Total non-interest income $ 58,294  $ 61,415 
Wealth management and trust fee income decreased $2.9 million for the three months ended March 31, 2025 as compared to the same quarter in 2024 mainly due to a decrease of $3.0 million in tax credit advisory service fees due to a lower volume of transactions.
Capital markets income increased $1.3 million for the three months ended March 31, 2025 as compared to the same quarter in 2024 mostly due to an increase in the volume of interest rate swap transactions related to commercial lending activities.
Service charges on deposit accounts increased $1.5 million for the three months ended March 31, 2025 as compared to the same quarter in 2024 mainly due to additional treasury service related fees for commercial deposit accounts.
Net gains on sales of assets decreased $3.7 million for the three months ended March 31, 2025 as compared to the same quarter in 2024 primarily as a result of a $3.6 million net gain realized on the sale of our commercial premium finance lending business during the first quarter 2024.
Bank owned life insurance income increased $1.5 million for the three months ended March 31, 2025 as compared to the same quarter in 2024 due to higher returns on the underlying investment securities.
Other non-interest income decreased $2.6 million for the three months ended March 31, 2025 as compared to the same period in 2024 partly due to a decrease in gains realized on the change in the fair value of equity securities.
Non-Interest Expense
Non-interest expense decreased $3.7 million for the three months ended March 31, 2025 as compared to the same quarter in 2024 mainly due to decreases in technology, furniture and equipment expense and FDIC insurance assessment fees, largely offset by higher amortization of tax credit investments and increased other expense. See further details below.



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The following table presents the components of non-interest expense for the three months ended March 31, 2025 and 2024:
  Three Months Ended
March 31,
  2025 2024
  (in thousands)
Salary and employee benefits expense $ 142,618  $ 141,831 
Net occupancy expense 25,888  24,323 
Technology, furniture and equipment expense 29,896  35,462 
FDIC insurance assessment 12,867  18,236 
Amortization of other intangible assets 8,019  9,412 
Professional and legal fees 15,670  16,465 
Amortization of tax credit investments 9,320  5,562 
Other 32,340  29,019 
Total non-interest expense $ 276,618  $ 280,310 
Net occupancy expense increased $1.6 million for the three months ended March 31, 2025 compared to the same quarter in 2024 mainly due to incremental increases in rent expense, cleaning and maintenance and property tax expenses.
Technology, furniture and equipment expense decreased $5.6 million for the three months ended March 31, 2025 as compared to the same quarter of 2024, mostly due to a decrease in software licensing costs, as well as lower depreciation expense and telecommunication related expense.
FDIC insurance assessment expense decreased $5.4 million for the three months ended March 31, 2025 as compared to the same quarter of 2024 primarily due to FDIC special assessment expenses of $7.4 million recorded in the first quarter of 2024.
Amortization of other intangibles decreased $1.4 million for the three months ended March 31, 2025 as compared to the same quarter of 2024 mainly due to a decline in amortization expense related to core deposits and loan servicing rights.
Amortization of tax credit investments increased $3.8 million for the three months ended March 31, 2025 as compared to the same quarter of 2024 mainly due to large purchases of tax-advantaged investments over the last twelve months. See Note 14 for more details regarding our tax credit investments.
Other non-interest expense increased $3.3 million for the three months ended March 31, 2025 as compared to the same quarter in 2024 largely due to a $2.9 million loss from the sale of one commercial real estate OREO property, as well as additional costs related to a loan credit risk transfer transaction, consisting of a credit default swap, executed in June 2024. The premium expense and other transaction costs associated with this credit protection totaled $2.0 million for the three months ended March 31, 2025. These increases were partially offset by a $1.9 million decrease in advertising expense.
Income Taxes
Income tax expense totaled $33.1 million for the first quarter 2025 as compared to an income tax benefit of $26.7 million for the fourth quarter 2024 and income tax expense of $33.2 million for the first quarter 2024. Our effective tax rate was 23.8 percent, negative 29.9 percent and 25.6 percent for the first quarter 2025, fourth quarter 2024 and first quarter 2024, respectively. The tax benefit and negative effective tax rate fourth quarter 2024 reflected a $46.4 million total reduction in uncertain tax liability positions and related accrued interest due to statute of limitation expirations. The decrease in the effective tax rate from the first quarter 2024 was primarily due to a higher level of investment in tax credits.
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GAAP requires that any change in judgment or change in measurement of a tax position taken in a prior annual period be recognized as a discrete event in the quarter in which it occurs, rather than being recognized as a change in effective tax rate for the current year. Our adherence to these tax guidelines may result in volatile effective income tax rates in future quarterly and annual periods. Factors that could impact management’s judgment include changes in income, tax laws and regulations, and tax planning strategies. Based on the current information available, we anticipate that our effective tax rate will be approximately within the 23 to 25 percent range for the remainder of 2025.
Operating Segments
Valley manages its business operations under operating segments consisting of Consumer Banking and Commercial Banking. Activities not assigned to the operating segments are included in Treasury and Corporate Other. The accounting for each operating segment and Treasury and Corporate Other includes internal accounting policies designed to measure consistent and reasonable financial reporting and may result in income and expense measurements that differ from amounts under GAAP. The financial reporting for each segment contains allocations and reporting in line with Valley’s operations, which may not necessarily be comparable to those of any other financial institution. Furthermore, changes in management structure or allocation methodologies and procedures may result in changes in reported segment financial data. Certain prior period amounts have been reclassified to conform to the current presentation for each operating segment and Treasury and Corporate Other. See Note 15 to the consolidated financial statements for additional details.
The following tables present the financial data for Valley's operating segments, and Treasury and Corporate Other for the three months ended March 31, 2025 and 2024:
  Three Months Ended March 31, 2025
  Consumer
Banking		 Commercial
Banking		 Treasury and Corporate Other Total
  ($ in thousands)
Average interest earning assets
$ 10,210,226  $ 38,444,695  $ 8,236,770 $ 56,891,691 
Interest income $ 122,463  $ 579,896  $ 82,393 $ 784,752 
Interest expense 65,442  246,411  52,794 364,647 
Net interest income 57,021  333,485  29,599 420,105 
(Credit) provision for credit losses (8,733) 71,408  (14) 62,661 
Net interest income after provision for credit losses 65,754  262,077  29,613 357,444 
Non-interest income 34,354  19,002  4,938 58,294 
Non-interest expense
Salary and employee benefits expense 31,974  102,990  7,654 142,618 
Net occupancy expense 4,705  17,457  3,726 25,888 
Technology, furniture, and equipment expense 6,237  19,853  3,806 29,896 
FDIC insurance assessment 2,700  10,167  — 12,867 
Professional and legal fees 2,899  10,943  1,828 15,670 
Other segment items * 14,286  15,443  19,950 49,679 
Total non-interest expense $ 62,801  $ 176,853  $ 36,964  $ 276,618 
Income (loss) before income taxes $ 37,307  $ 104,226  $ (2,413) $ 139,120 
Return on average interest earning assets (pre-tax)
1.46  % 1.08  % (0.12) % 0.98  %
Net interest margin 2.24  % 3.47  % 1.44  % 2.95  %
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  Three Months Ended March 31, 2024
  Consumer
Banking		 Commercial
Banking		 Treasury and Corporate Other Total
  ($ in thousands)
Average interest earning assets
$ 9,796,681  $ 40,449,910  $ 6,372,206 $ 56,618,797 
Interest income $ 113,762  $ 657,791  $ 57,103 $ 828,656 
Interest expense 75,286  310,852  48,970 435,108 
Net interest income 38,476  346,939  8,133 393,548 
Provision (credit) for credit losses 3,072  42,202  (74) 45,200 
Net interest income after provision for credit losses 35,404  304,737  8,207 348,348 
Non-interest income 33,165  23,130  5,120 61,415 
Non-interest expense
Salary and employee benefits expense 28,658  101,858  11,315 141,831 
Net occupancy expense 4,268  17,363  2,692 24,323 
Technology, furniture, and equipment expense 6,537  25,264  3,661 35,462 
FDIC insurance assessment 2,114  8,728  7,394 18,236 
Professional and legal fees 2,827  12,082  1,556 16,465 
Other segment items * 12,591  13,203  18,199 43,993 
Total non-interest expense $ 56,995  $ 178,498  $ 44,817  $ 280,310 
Income (loss) before income taxes $ 11,574  $ 149,369  $ (31,490) $ 129,453 
Return on average interest earning assets (pre-tax)
0.47  % 1.48  % (1.98) % 0.91  %
Net interest margin 1.57  % 3.43  % 0.51  % 2.78  %
* Other segment items include amortization of intangible assets, amortization of tax credit investments and other general operating expenses.
 

Consumer Banking Segment
The Consumer Banking segment represented 19.3 percent of our loan portfolio at March 31, 2025, and was mainly comprised of residential mortgage loans and automobile loans, and to a lesser extent, home equity loans, secured personal lines of credit and other consumer loans (including credit card loans). The duration of the residential mortgage loan portfolio (which represented 11.6 percent of our loan portfolio at March 31, 2025) is subject to movements in the market level of interest rates and forecasted prepayment speeds. The weighted average life of the automobile loans portfolio (which represented 4.2 percent of total loans at March 31, 2025) is relatively unaffected by movements in the market level of interest rates. However, the average life may be impacted by new loans as a result of the availability of credit within the automobile marketplace and consumer demand for purchasing new or used automobiles. Consumer Banking also includes the Wealth Management and Insurance Services Division, comprised of asset management advisory, brokerage, trust, personal and title insurance, tax credit advisory services, and our international and domestic private banking businesses.
Consumer Banking’s average interest earning assets increased $413.5 million to $10.2 billion for the first quarter 2025 as compared to the same period of 2024. The increase was mostly due to strong growth in our automobile loan portfolio over the last 12-month period and, to a much lesser extent, higher average home equity and residential mortgage loan balances. These increases were partially offset by a decline in average other consumer loans mainly driven by lower secured personal lines of credit balances.
Income before income taxes generated by the Consumer Banking segment increased $25.7 million to $37.3 million for the first quarter 2025 as compared to the first quarter 2024. The increase was mainly driven by a combination of an increase in net interest income and a lower provision for loan losses, partially offset by an increase in non-interest expense.
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Net interest income for this segment increased $18.5 million mainly due to the aforementioned growth in average loans coupled with lower funding costs. The provision for loan losses decreased $11.8 million for the first quarter 2025 as compared to the first quarter 2024 mainly due to lower quantitative reserves within the residential mortgage loan portfolio based on continued high levels of credit performance. Non-interest expense increased $5.8 million for the first quarter 2025 mainly due to higher salary and employee benefits expense.
Net interest margin on the Consumer Banking portfolio increased 67 basis points to 2.24 percent for the first quarter 2025 as compared to the first quarter 2024 mainly due to a 16 basis point increase in the yield on average loans, combined with a 51 basis point decrease in the costs associated with our funding sources. The 16 basis point increase in loan yield was largely due to higher yielding new loan volumes over most of the last 12-month period. The decrease in our funding costs was mainly driven by a decrease in higher cost time deposits and lower interest rates on most deposit products during the first quarter 2025. Our cost of total average deposits was 2.65 percent for the first quarter 2025 as compared to 3.16 percent for the first quarter 2024. See the “Net Interest Income” section above for more details on our net interest margin and funding sources.
Commercial Banking Segment
The Commercial Banking segment is comprised of floating rate and adjustable rate commercial and industrial loans and construction loans, as well as fixed rate owner occupied and commercial real estate loans. Due to the portfolio’s interest rate characteristics, Commercial Banking is Valley’s operating segment that is most sensitive to movements in market interest rates. Commercial and industrial loans totaled approximately $10.2 billion and represented 20.9 percent of the total loan portfolio at March 31, 2025. Commercial real estate and construction loans totaled $29.1 billion and represented 59.8 percent of the total loan portfolio at March 31, 2025.
Average interest earning assets in Commercial Banking segment decreased $2.0 billion to $38.4 billion for the first quarter 2025 as compared to the first quarter 2024. The decrease was mostly due to the bulk sales of certain performing CRE loans during both late March 2024 and the fourth quarter 2024, as well as continued CRE loan repayment activity.
Income before income taxes for Commercial Banking decreased $45.1 million to $104.2 million for the first quarter 2025 as compared to the same period of 2024 mainly due to a decrease in net interest income combined with a higher provision for credit losses. Net interest income for this segment decreased $13.5 million to $333.5 million for the first quarter 2025 as compared to the same period in 2024 largely due to a $77.9 million decrease in interest income mainly driven by lower average loan balances in this segment, partially offset by a decrease in interest expense. The provision for credit losses increased $29.2 million to $71.4 million as compared to the same period in 2024 mainly due to higher quantitative reserves allocated to commercial real estate loans and the reserve build required for our continued solid commercial and industrial loan growth. See details in the “Allowance for Credit Losses for Loans” section of this MD&A. In addition, a $4.1 million decrease in non-interest income, mainly driven by a decrease in net gains on sales of assets and lower swap fees related to commercial lending, also negatively impacted income before taxes for this operating segment for the first quarter 2025. See further details in the “Non-Interest Income” section of this MD&A.
The net interest margin for this segment increased 4 basis points to 3.47 percent for the first quarter 2025 as compared to the first quarter 2024 due to a 51 basis point decrease in the cost of our funding sources, largely offset by a 47 basis point decrease in the yield on average loans.
Treasury and Corporate Other
Treasury and Corporate Other largely consists of the Treasury managed HTM debt securities and AFS debt securities portfolios mainly utilized for the liquidity management needs of our lending segments and income and expense items resulting from support functions not directly attributable to a specific segment. Interest income is generated through investments in various types of securities (mainly comprised of fixed rate securities) and interest-bearing deposits with other banks (primarily the Federal Reserve Bank of New York). Expenses related to the branch network, all other components of retail banking, along with the back office departments of the Bank are allocated from Treasury and Corporate Other to operating segments.
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Other non-interest income items and general expenses are allocated from Treasury and Corporate Other to each operating segment utilizing a methodology that involves an allocation of operating and funding costs based on each segment's respective mix of average interest earning assets outstanding for the period, number of deposits, or direct allocations to the segments based on the nature of income and expense. Unallocated items included in Treasury and Corporate Other mainly consist of net gains and losses on AFS and HTM securities transactions, amortization of tax credit investments, as well as other non-core items, including FDIC special assessment and corporate restructuring charges.
Treasury and Corporate Other's average interest earning assets increased $1.9 billion to $8.2 billion for the first quarter 2025 primarily due to increase in average taxable investments largely resulting from additional purchases of residential mortgage-backed securities classified as AFS over the last 12-month period.
For the first quarter 2025, loss before income taxes totaled $2.4 million compared to $31.5 million of income before taxes for the same period in 2024. The $29.1 million decrease in the pre-tax loss from the first quarter 2024 was mainly driven by a $21.5 million increase in net interest income largely due to the additional interest income generated by higher average taxable investments. In addition, non-interest expense decreased $7.9 million to $37.0 million for the first quarter 2025 as compared to the same period in 2024 largely due to a $7.4 million decrease in the FDIC insurance special assessment allocated to our Treasury activities. See further details in the “Non-Interest Expense” section of this MD&A.
Treasury and Corporate Other's net interest margin increased 93 basis points to 1.44 percent for the first quarter 2025 as compared to the first quarter 2024 due to a 42 basis point increase in the yield on average investments due to the higher yielding new investment securities purchased over the last 12 months coupled with a 51 basis point decrease in the cost of our funding sources.
ASSET/LIABILITY MANAGEMENT
Interest Rate Risk
Our success is largely dependent upon our ability to manage interest rate risk. Interest rate risk can be defined as the exposure of our interest rate sensitive assets and liabilities to the movement in interest rates. Our Asset/Liability Management Committee is responsible for managing such risks and establishing policies that monitor and coordinate our sources and uses of funds. Asset/Liability management is a continuous process due to the constant change in interest rate risk factors. In assessing the appropriate interest rate risk levels for us, management weighs the potential benefit of each risk management activity within the desired parameters of liquidity, capital levels and management’s tolerance for exposure to income fluctuations. Many of the actions undertaken by management utilize fair value analysis and attempt to achieve consistent accounting and economic benefits for financial assets and their related funding sources. We have predominantly focused on managing our interest rate risk by attempting to match the inherent risk and cash flows of financial assets and liabilities. Specifically, management employs multiple risk management activities, such as optimizing the level of new residential mortgage originations retained in our mortgage portfolio through increasing or decreasing loan sales in the secondary market, product pricing levels, the desired maturity levels for new originations, the composition levels of both our interest earning assets and interest bearing liabilities, as well as several other risk management activities.
We use a simulation model to analyze net interest income sensitivity to movements in interest rates. The simulation model projects net interest income based on various interest rate scenarios over a 12-month period. The model is based on the actual maturity and re-pricing characteristics of rate sensitive assets and liabilities. The model incorporates certain assumptions which management believes to be reasonable regarding the impact of changing interest rates, non-maturity deposit betas, and the prepayment assumptions of certain assets and liabilities as of March 31, 2025. The model assumes immediate changes in interest rates without any proactive change in the composition or size of the balance sheet, or other future actions that management might undertake to mitigate this risk. In the model, the forecasted shape of the yield curve remains static as of March 31, 2025. The impact of interest rate derivatives, such as interest rate swaps, is also included in the model.
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Our simulation model is based on market interest rates and prepayment speeds prevalent in the market as of March 31, 2025. Although the size of Valley’s balance sheet is forecast to remain static as of March 31, 2025, in our model, the composition is adjusted to reflect new interest earning assets and funding originations coupled with rate spreads utilizing our actual originations during the first quarter 2025. The model utilizes an immediate parallel shift in market interest rates at March 31, 2025.
The assumptions used in the net interest income simulation are inherently uncertain. Actual results may differ significantly from those presented in the table below, due to the frequency and timing of changes in interest rates and changes in spreads between maturity and re-pricing categories. Overall, our net interest income is affected by changes in interest rates and cash flows from our loan and investment portfolios. We actively manage these cash flows in conjunction with our liability mix, duration, and interest rates to optimize the net interest income, while structuring the balance sheet in response to actual or potential changes in interest rates. Additionally, our net interest income is impacted by the level of competition within our marketplace. Competition can negatively impact the level of interest rates attainable on loans and increase the cost of deposits, which may result in downward pressure on our net interest margin in future periods. Other factors, including, but not limited to, the slope of the yield curve and projected cash flows will impact our net interest income results and may increase or decrease the level of asset sensitivity of our balance sheet.
Convexity is a measure of how the duration of a financial instrument changes as market interest rates change. Potential movements in the convexity of bonds held in our investment portfolio, as well as the duration of the loan portfolio may have a positive or negative impact on our net interest income in varying interest rate environments. As a result, the increase or decrease in forecast net interest income may not have a linear relationship to the results reflected in the table below. Management cannot provide any assurance about the actual effect of changes in interest rates on our net interest income.
The following table reflects management’s expectations of the change in our net interest income over the next 12- month period considering the aforementioned assumptions. While an instantaneous and severe shift in interest rates was used in this simulation model, we believe that any actual shift in interest rates would likely be more gradual and would therefore have a more modest impact than shown in the table below.
  Estimated Change in
Future Net Interest Income
Changes in Interest Rates Dollar
Change		 Percentage
Change
(in basis points) ($ in thousands)
+300 $ 129,311  7.23  %
+200 87,591  4.90 
+100 43,924  2.46 
–100 (45,444) (2.54)
–200 (93,092) (5.21)
–300 (135,960) (7.60)
As noted in the table above, a 100 basis point immediate decrease in interest rates combined with a static balance sheet where the size, mix, and proportions of assets and liabilities remain unchanged, is projected to decrease net interest income over the next 12-month period by 2.54 percent. Management believes the interest rate sensitivity of our balance sheet remains within an expected tolerance range at March 31, 2025. However, the level of net interest income sensitivity may increase or decrease in the future as a result of several factors, including potential changes in our balance sheet strategies, the slope of the yield curve and projected cash flows.



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Liquidity and Cash Requirements
Bank Liquidity
Liquidity measures Valley's ability to satisfy its current and future cash flow needs. Our objective is to have liquidity available to fulfill loan demands, repay deposits and other liabilities, and execute balance sheet strategies in all market conditions while adhering to internal controls and income targets. Valley's liquidity program is managed by the Treasury Department and routinely monitored by the Asset and Liability Management Committee and Board Risk Committee. Among other actions, the Treasury Department actively monitors Valley's current liquidity profile, sources and stability of funding, availability of assets for pledging or sale, opportunities to gather additional funds, and anticipated future funding needs, including the level of unfunded commitments.
The Bank adheres to certain internal liquidity measures including ratios of loans to deposits below 110 percent and wholesale funding to total funding below 25 percent, as summarized in the table below. Management maintains flexibility to temporarily exceed these internal limits in certain operating environments but also strives to outperform these limits when possible. The Bank was in compliance with the foregoing policies at March 31, 2025.
The following table presents Valley's loans to deposits and wholesale funding to total funding ratios at March 31, 2025 and December 31, 2024:
March 31,
2025		 December 31,
2024
Loans to deposits 97.4  % 97.5  %
Wholesale funding to total funding 17.7  18.7 
Valley's short and long-term cash requirements include contractual obligations under borrowings, deposits, payments related to leases, capital expenditures and other purchase commitments. In the ordinary course of operations, the Bank also enters into various financial obligations, including contractual obligations that may require future cash payments. Management believes the Bank has the ability to generate and obtain adequate amounts of cash to meet its short-term and long-term obligations as they come due by utilizing various cash resources described below.
On the asset side of the balance sheet, the Bank has numerous sources of liquid funds in the form of cash and due from banks, interest bearing deposits with banks (including the FRB of New York) and other sources. The following table summarizes Valley's sources of liquid assets:
March 31,
2025		 December 31,
2024
(in thousands)
Cash and due from banks $ 508,887  $ 411,412 
Interest bearing deposits with banks 714,810  1,478,713 
Held to maturity debt securities (1)
226,775  220,056 
Available for sale debt securities (2)
 3,658,704  3,369,724 
Loans held for sale 27,377  25,681 
Total liquid assets $ 5,136,553  $ 5,505,586 
(1)     Represents securities that are maturing within 90 days or would otherwise qualify as maturities if sold (i.e., 85 percent of original cost basis has been repaid) within the held to maturity debt security portfolio.
(2)     Includes approximately $902.5 million and $1.8 billion of various investment securities that were pledged to counterparties to support our earning asset funding strategies at March 31, 2025 and December 31, 2024, respectively.
Total liquid assets represented 9.1 percent and 9.6 percent of interest earning assets at March 31, 2025 and December 31, 2024, respectively. The level of cash liquidity on the balance sheet decreased to a more normalized level at March 31, 2025 from December 31, 2024 as part of our liquidity management, including the repayment of maturing higher cost indirect customer CDs during the first quarter 2025 as noted elsewhere in this MD&A.
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Other sources of funds on the asset side are derived from scheduled loan payments of principal and interest, as well as prepayments received. At March 31, 2025, estimated cash inflows from total loans are projected to be approximately $16.2 billion over the next 12-month period. As a contingency plan for any liquidity constraints, liquidity could also be derived from the sale of conforming residential mortgages from our loan portfolio or alleviated from the temporary curtailment of lending activities. We anticipate the receipt of approximately $954.0 million in principal payments from securities in the total investment portfolio at March 31, 2025 over the next 12-month period due to normally scheduled principal repayments and expected prepayments of certain securities, primarily residential mortgage-backed securities.
On the liability side of the balance sheet, we utilize multiple sources of funds to meet liquidity needs, including commercial and consumer deposits, fully FDIC-insured indirect customer deposits, collateralized municipal deposits, and short-term and long-term borrowings. Our core deposit base, which generally excludes all fully insured indirect customer deposits, as well as retail certificates of deposit over $250 thousand, represents the largest of these sources. Average core deposits totaled approximately $41.5 billion and $39.1 billion for the three months ended March 31, 2025 and for the year ended December 31, 2024, respectively, representing 72.9 percent and 68.3 percent of average interest earning assets for the respective periods. The level of interest bearing deposits is affected by interest rates offered, which is often influenced by our need for funds, rates prevailing in the capital markets, competition, and the need to manage interest rate risk sensitivity.
In addition to customer deposits, the Bank has access to readily available borrowing sources to supplement its current and projected funding needs. The following table presents short-term borrowings outstanding at March 31, 2025 and December 31, 2024:
March 31, 2025 December 31, 2024
  (in thousands)
Securities sold under agreements to repurchase $ 59,026  $ 72,718 
Total short-term borrowings $ 59,026  $ 72,718 
The following table summarizes the Bank's estimated unused available non-deposit borrowing capacities at March 31, 2025 and December 31, 2024:
March 31, 2025 December 31, 2024
(in thousands)
FHLB borrowing capacity* $ 5,861,000  $ 5,853,596 
Unused FRB discount window* 10,224,000  11,509,000 
Unused federal funds lines available from commercial banks 1,610,000  2,140,000 
Unencumbered investment securities 4,727,166  3,415,834 
Total $ 22,422,166  $ 22,918,430 
*     Used and unused FHLB and FRB borrowings are collateralized by certain pledged securities, including but not limited to U.S. government and agency mortgage-backed securities and blanket qualifying first lien on certain real estate and residential mortgage secured loans.
Corporation Liquidity
Valley’s recurring cash requirements primarily consist of dividends to preferred and common shareholders and interest expense on subordinated notes and junior subordinated debentures issued to capital trusts. As part of our ongoing asset/liability management strategies, Valley could also use cash to repurchase shares of its outstanding common stock under its share repurchase program or redeem its callable junior subordinated debentures and subordinated notes.
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Valley's cash needs are routinely satisfied by dividends collected from the Bank. Projected cash flows from the Bank are expected to be adequate to pay preferred and common dividends, if declared, and interest expense payable to subordinated note holders and capital trusts, given the current capital levels and current profitable operations of the Bank. In addition to dividends received from the Bank, Valley can satisfy its cash requirements by utilizing its own cash and potential new funds borrowed from outside sources or capital issuances, such as the undistributed net proceeds of our most recent common stock offering in November 2024. Valley also has the right to defer interest payments on the junior subordinated debentures, and therefore distributions on its trust preferred securities for consecutive quarterly periods of up to five years, but not beyond the stated maturity dates, and subject to other conditions.
Investment Securities Portfolio
As of March 31, 2025, we had $74.4 million, $3.7 billion, and $3.5 billion in equity, AFS debt and HTM debt securities, respectively. The AFS and HTM debt securities portfolios, which comprise the majority of the securities we own, include: U.S. Treasury securities, U.S. government agency securities, tax-exempt and taxable issuances of states and political subdivisions, residential mortgage-backed securities, single-issuer trust preferred securities principally issued by bank holding companies and high quality corporate bonds. Among other securities, our AFS debt securities include securities such as bank issued and other corporate bonds, as well as municipal special revenue bonds, which may pose a higher risk of future impairment charges to us as a result of the uncertain economic environment and its potential negative effect on the future performance of the security issuers. The equity securities consist of two publicly traded mutual funds, CRA investments and several other equity investments that we have made in companies that develop new financial technologies and in partnerships that invest in such companies. Our CRA and other equity investments are a mix of both publicly traded entities and privately held entities.
The primary purpose of our AFS and HTM investment portfolios is to provide a source of earnings and liquidity, as well as serve as a tool for managing interest rate risk. The decision to purchase or sell securities is based upon the current assessment of long and short-term economic and financial conditions, including the interest rate environment and other components of statement of financial condition. See additional information under “Interest Rate Sensitivity,” “Liquidity and Cash Requirements” and “Capital Adequacy” sections elsewhere in this MD&A.
We continually evaluate our investment securities portfolio in response to established asset/liability management objectives, changing market conditions that could affect profitability, and the level of interest rate risk to which we are exposed. These evaluations may cause us to change the level of funds we deploy into investment securities, change the composition of our investment securities portfolio, and change the proportion of investments primarily made into the AFS and HTM debt securities portfolios.
Allowance for Credit Losses and Impairment Analysis
Available for sale debt securities. AFS debt securities in unrealized loss positions are evaluated for impairment related to credit losses at least quarterly. In assessing whether a credit loss exists, we compare the present value of cash flows expected to be collected from the security with the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis for the security, a credit loss exists and an allowance for credit losses is recorded, limited to the amount that the fair value is less than the amortized cost basis. Declines in fair value that have not been recorded through an allowance for credit losses, such as declines due to changes in market interest rates, are recorded through other comprehensive income, net of applicable taxes.
We have evaluated all AFS debt securities that are in an unrealized loss position as of March 31, 2025 and December 31, 2024 and determined that the declines in fair value were mainly attributable to interest rates, credit spreads, market volatility and liquidity conditions, not credit quality or other factors. There was no impairment recognized within the AFS debt securities portfolio during the three months ended March 31, 2025 and March 31, 2024.
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Valley does not intend to sell any of its AFS debt securities in an unrealized loss position prior to recovery of our amortized cost basis, and it is more likely than not that Valley will not be required to sell any of its securities prior to recovery of our amortized cost basis. None of the AFS debt securities were past due as of March 31, 2025 and there was no allowance for credit losses for AFS debt securities at March 31, 2025 and December 31, 2024.
Held to maturity debt securities. Valley estimates the expected credit losses on HTM debt securities that have loss expectations using a discounted cash flow model developed by a third party. Valley has a zero-loss expectation for certain securities within the HTM portfolio, including U.S. Treasury securities, U.S. agency securities, residential mortgage-backed securities issued by Ginnie Mae, Fannie Mae and Freddie Mac, and collateralized municipal bonds. To measure the expected credit losses on HTM debt securities that have loss expectations, we utilize a third- party discounted cash flow model. The assumptions used in the model for pools of securities with common risk characteristics include the historical lifetime probability of default and severity of loss in the event of default, with the model incorporating several economic cycles of loss history data to calculate expected credit losses given default at the individual security level. HTM debt securities were carried net of an allowance for credit losses totaling approximately $633 thousand and $647 thousand at March 31, 2025 and December 31, 2024, respectively. There were no net charge-offs of HTM debt securities during the three months ended March 31, 2025 and March 31, 2024.
Investment grades. The investment grades in the table below reflect the most current independent analysis performed by third parties of each security as of the date presented and not necessarily the investment grades at the date of our purchase of the securities. For many securities, the rating agencies may not have performed an independent analysis of the tranches owned by us, but rather an analysis of the entire investment pool. For this and other reasons, we believe the assigned investment grades may not accurately reflect the actual credit quality of each security and should not be viewed in isolation as a measure of the quality of our investment portfolio.
The following table presents the available for sale and held to maturity debt investment securities portfolios by investment grades at March 31, 2025:
  March 31, 2025
  Amortized
Cost		 Gross
Unrealized
Gains		 Gross
Unrealized
Losses		 Fair Value
(in thousands)
Available for sale investment grades: *
AAA/AA/A Rated $ 3,582,382  $ 16,263  $ (150,565) $ 3,448,080 
BBB Rated 96,233  63  (2,320) 93,976 
Not rated 125,545  248  (9,145) 116,648 
Total $ 3,804,160  $ 16,574  $ (162,030) $ 3,658,704 
Held to maturity investment grades: *
AAA/AA/A Rated $ 3,383,621  $ 5,049  $ (442,107) $ 2,946,563 
BBB Rated 6,000  —  (124) 5,876 
Not rated 156,340  8  (11,153) 145,195 
Total $ 3,545,961  $ 5,057  $ (453,384) $ 3,097,634 
Allowance for credit losses 633  —  —  633 
Total, net of allowance for credit losses $ 3,545,328  $ 5,057  $ (453,384) $ 3,097,001 
*    Rated using external rating agencies. Ratings categories include entire range. For example, “A Rated” includes A+, A, and A-. Split rated securities with two ratings are categorized at the higher of the rating levels.
The unrealized losses in the AAA/AA/A rated categories of both the AFS and HTM debt securities portfolios (in the above table) were largely related to residential mortgage-backed securities issued by Ginnie Mae, Fannie Mae and Freddie Mac and continue to be driven by the higher market interest rate environment. The investment securities AFS and HTM portfolios included investments with carrying values of $116.6 million and $156.3 million, respectively, at March 31, 2025 not rated by the rating agencies with aggregate unrealized losses of $9.1 million and $11.2 million, respectively.
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The unrealized losses within non-rated AFS debt securities mostly related to several large corporate bonds negatively impacted by rising interest rates and not changes in underlying credit. The unrealized losses within non-rated HTM debt securities mainly related to four single-issuer bank trust preferred issuances with a combined amortized cost of $36.1 million with $6.6 million gross unrealized losses and several corporate debt securities that were negatively impacted by rising interest rates, and not changes in their underlying credit.
See Note 6 to the consolidated financial statements for additional information regarding our investment securities portfolio.
Loan Portfolio
The following table reflects the composition of the loan portfolio as of the dates presented:
March 31,
2025		 December 31,
2024
  ($ in thousands)
Loans
Commercial and industrial $ 10,150,205 $ 9,931,400
Commercial real estate:
Non-owner occupied 11,945,222 12,344,355
Multifamily (1)
 8,420,385 8,299,250
Owner occupied 5,722,014 5,886,620
Total 26,087,621 26,530,225
Construction 3,026,935 3,114,733
Total commercial real estate 29,114,556 29,644,958
Residential mortgage 5,636,407 5,632,516
Consumer:
Home equity 602,161 604,433
Automobile 2,041,227 1,901,065
Other consumer 1,112,572 1,085,339
Total consumer loans 3,755,960 3,590,837
Total loans (2)
 $ 48,657,128 $ 48,799,711
As a percentage of total loans:
Commercial and industrial 20.9  % 20.4  %
Commercial real estate:
Non-owner occupied 24.5  25.2 
Multifamily 17.3  17.0 
Owner occupied 11.8  12.1 
Construction 6.2  6.4 
Total commercial real estate 59.8  60.7 
Residential mortgage 11.6  11.5 
Consumer loans 7.7  7.4 
Total 100.0  % 100.0  %
(1)
Includes loans collateralized by properties that are greater than 50 percent rent regulated totaling approximately $577 million and $553 million at March 31, 2025 and December 31, 2024, respectively.
(2)
Includes net unearned discount and deferred loan fees of $30.1 million and $45.3 million at March 31, 2025 and December 31, 2024, respectively.
Total loans decreased $142.6 million, or 1.2 percent on an annualized basis, to $48.7 billion at March 31, 2025 from December 31, 2024 mostly due to normal repayment activity and selective originations within the commercial real estate loan portfolio. Loans held for sale are presented separately from total loans on the consolidated statements of financial condition and totaled $27.4 million and $25.7 million at March 31, 2025 and December 31, 2024, respectively.
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Commercial and industrial loans grew by $218.8 million, or 8.8 percent on an annualized basis, to $10.2 billion at March 31, 2025 from December 31, 2024 largely due to our continued strategic focus on growth within this category. New loan volumes continue to be a diverse range of relationship-driven middle market businesses largely located in our primary markets, as well as some nationwide businesses.
Commercial real estate loans (excluding construction loans) decreased $442.6 million to $26.1 billion at March 31, 2025 from December 31, 2024. The decrease was largely driven by repayment activity and continued selective origination activity within this portfolio. As a result, our CRE loan concentration ratio declined to approximately 353 percent at March 31, 2025 from 362 percent at December 31, 2024. The decreases in non-owner occupied and owner occupied categories were partially offset by a $121.1 million increase in multifamily portfolio mainly due to the migration of several completed construction loan projects to permanent financing. Overall, commercial real estate loans are well-diversified across our footprint areas in Florida, Alabama, New Jersey, New York and Manhattan with a combined weighted average loan to value ratio of 58 percent and debt service coverage ratio of 1.67 at March 31, 2025. Both of these ratios remained relatively unchanged from December 31, 2024. Commercial real estate collateralized by office buildings totaled approximately $3.0 billion at March 31, 2025 as compared to $3.1 billion at December 31, 2024. Our loans collateralized by office buildings had a combined weighted average loan to value rate of 62 percent and debt service coverage ratio of 1.77 at March 31, 2025. Both of these ratios also remained relatively unchanged from December 31, 2024.
Construction loans decreased $87.8 million to $3.0 billion at March 31, 2025 from December 31, 2024 mainly due to the migration of completed projects to permanent financing within the multifamily loan category during the first quarter 2025, partially offset by new advances. Additionally, a non-performing loan totaling $10.2 million, net of $638 thousand of charge-offs, was transferred to loans held for sale at March 31, 2025.
Residential mortgage loans totaled $5.6 billion at March 31, 2025 and increased only $3.9 million from December 31, 2024 as new volumes of loans held for investment were mostly offset by normal repayment activity. New and refinanced residential mortgage loan originations totaled $132.8 million for the first quarter 2025 as compared to $182.0 million and $115.0 million for the fourth quarter 2024 and first quarter 2024, respectively. We retained approximately 71.8 percent and 71.3 percent of the total residential mortgage originations in our held for investment loan portfolio during the first quarter 2025 and the fourth quarter 2024, respectively.
Consumer loans increased $165.1 million, or 18.4 percent on an annualized basis, to $3.8 billion at March 31, 2025 as compared to December 31, 2024 mainly due to increases in the automobile and other consumer loan portfolios. Automobile loans increased by $140.2 million, or 29.5 percent on an annualized basis, to $2.0 billion at March 31, 2025 as compared to December 31, 2024 mainly due to (i) efforts to expand our indirect auto dealer network within our market areas, (ii) continued strong high-quality consumer demand that was likely elevated further by the potential negative impact of tariffs on future auto prices, and (iii) low levels of prepayment activity within the portfolio during the first quarter 2025. Auto loan originations totaled $375.5 million for the first quarter 2025 as compared to $291.3 million for the fourth quarter 2024. Other consumer loans increased $27.2 million to $1.1 billion at March 31, 2025 as compared to December 31, 2024 primarily due to higher demand and usage of collateralized personal lines of credit.
A significant part of our lending is in northern and central New Jersey, New York City, Long Island and Florida. To mitigate our geographic risks, we make efforts to maintain a diversified portfolio as to type of borrower and loan to guard against a potential downward turn in any one economic sector.
We continue to proactively diversify our loan portfolio by reducing new originations of certain types of commercial real estate lending, such as non-owner occupied and multifamily loans through highly selective new loan origination. We also remain significantly focused on the growth of our commercial and industrial loan portfolio. In Valley's Annual Report, we provided guidance that we anticipated loan growth for 2025, net of continued runoff from scheduled maturities of commercial real estate non-owner occupied and multifamily loans, in the range of 3 to 5 percent as compared to total loans of $48.8 billion at December 31, 2024.
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Based upon our current projections, we now expect total loan growth for 2025 to fall within the low-end of the 3 to 5 percent range due to the current level of competition for high quality commercial loans, an expected decline in business investment due to the impact of tariffs and any retaliatory actions, as well as other factors. However, there can be no assurance that we will achieve such growth levels given the potential for unforeseen changes in the market and other conditions detailed in our risk factors set forth under Item 1A. Risk Factors of Valley's Annual Report.
Non-performing Assets
NPAs include non-accrual loans, OREO, and other repossessed assets (which consist of automobiles and taxi medallions) at March 31, 2025. Loans are generally placed on non-accrual status when they become past due in excess of 90 days as to payment of principal or interest and/or the full and timely collection of principal and interest becomes uncertain. Exceptions to the non-accrual policy may be permitted if the loan is sufficiently collateralized and in the process of collection. OREO is acquired through foreclosure on loans secured by land or real estate. OREO and other repossessed assets are reported at lower of cost or fair value, less estimated cost to sell.
Our NPAs decreased $17.1 million to $356.2 million at March 31, 2025 as compared to December 31, 2024 mainly due to lower non-accrual commercial and industrial loans coupled with a decrease in OREO, partially offset by an increase in non-accrual commercial real estate loans. NPAs as a percentage of total loans and NPAs totaled 0.73 percent and 0.76 percent at March 31, 2025 and December 31, 2024, respectively (as shown in the table below). We believe our total NPAs have remained relatively low as a percentage of the total loan portfolio and NPAs, which is reflective of our consistent approach to the loan underwriting criteria for both Valley originated loans and loans purchased from third parties. For additional details, see the “Credit quality indicators” section in Note 7 to the consolidated financial statements.
Our lending strategy is based on underwriting standards designed to maintain high credit quality, and we remain optimistic regarding the overall future performance of our loan portfolio. During the three months ended March 31, 2025, the majority of our borrowers continued to demonstrate resilience despite the impact of higher borrowing costs, inflation, labor costs and other factors. We continue to proactively monitor our commercial loans for potential negative trends/borrower weakness due to the current operating environment, including the potential negative impact of the recent tariff actions, and internally risk rate them accordingly. Based on our most recent portfolio review, we believe that we have relatively modest direct exposure to customer businesses most influenced by changing tariff policies. However, management cannot provide assurance that the NPAs will not increase from the levels reported at March 31, 2025 due to the aforementioned or other factors potentially impacting our lending customers.
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The following table sets forth by loan category accruing past due and NPAs at the dates indicated in conjunction with our asset quality ratios: 
March 31,
2025		 December 31,
2024
  ($ in thousands)
Accruing past due loans:
30 to 59 days past due:
Commercial and industrial $ 3,609  $ 2,389 
Commercial real estate 170  20,902 
Residential mortgage 16,747  21,295 
Total consumer 12,887  12,552 
Total 30 to 59 days past due 33,413  57,138 
60 to 89 days past due:
Commercial and industrial 420  1,007 
Commercial real estate —  24,903 
Residential mortgage 7,700  5,773 
Total consumer 2,408  4,484 
Total 60 to 89 days past due 10,528  36,167 
90 or more days past due:
Commercial and industrial —  1,307 
Residential mortgage 6,892  3,533 
Total consumer 864  1,049 
Total 90 or more days past due 7,756  5,889 
Total accruing past due loans $ 51,697  $ 99,194 
Non-accrual loans:
Commercial and industrial $ 110,146  $ 136,675 
Commercial real estate 172,011  157,231 
Construction 24,275  24,591 
Residential mortgage 35,393  36,786 
Total consumer 4,626  4,215 
Total non-accrual loans 346,451  359,498 
Other real estate owned (OREO) 7,714  12,150 
Other repossessed assets 2,054  1,681 
Total non-performing assets (NPAs) $ 356,219  $ 373,329 
Total non-accrual loans as a % of loans 0.71  % 0.74  %
Total NPAs as a % of loans and NPAs 0.73  0.76 
Total accruing past due and non-accrual loans as a % of loans
 0.82  0.94 
Allowance for loan losses as a % of non-accrual loans
 166.89  155.45 
Loans 30 to 59 days past due decreased $23.7 million to $33.4 million at March 31, 2025 as compared to December 31, 2024 largely due to a previously reported delinquent commercial real estate loan totaling $15.1 million that was current to its contractual payments at March 31, 2025, a $2.4 million commercial real estate loan that was reclassified to the non-accrual category during the first quarter 2025, as well as a general improvement in residential mortgage loan delinquencies in this category.
Loans 60 to 89 days past due decreased $25.6 million to $10.5 million at March 31, 2025 as compared to December 31, 2024 mostly due to the renewal of an $18.6 million matured performing commercial real estate loan reported in this delinquency category at December 31, 2024 and a $4.5 million commercial real estate loan that was reclassified to the non-accrual category during the first quarter 2025.
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Loans 90 days or more past due and still accruing interest increased $1.9 million to $7.8 million at March 31, 2025 as compared to December 31, 2024 mainly due to an increase in residential mortgage loans delinquencies. All loans 90 days or more past due and still accruing interest are well-secured and in the process of collection.
Non-accrual loans decreased $13.0 million to $346.5 million at March 31, 2025 as compared to $359.5 million at December 31, 2024, largely driven by partial charge-offs of two non-performing commercial and industrial loan relationships during the first quarter 2025, partially offset by a moderate increase in non-performing commercial real estate loans at March 31, 2025. Non-accrual commercial and industrial loans decreased $26.5 million at March 31, 2025 as compared to December 31, 2024 largely driven by a $24.1 million of partial and full charge-offs during the first quarter 2025 related to two non-performing loan relationships with combined allocated reserves of $16.0 million at December 31, 2024. Non-accrual commercial real estate loans increased $14.8 million at March 31, 2025 as compared to December 31, 2024 mostly driven by additional non-performing loan relationships, including two loan relationships totaling $6.9 million that were reclassified from the aforementioned past due categories during the first quarter 2025.
Non-performing taxi medallion loans included in non-accrual commercial and industrial loans totaled $49.2 million at March 31, 2025 and had related reserves of $25.6 million, or 52.1 percent of such loans, within the allowance for loan losses as compared to $49.5 million of loans with related reserves of $25.8 million at December 31, 2024. Further potential declines in the market valuation of taxi medallions and the current operating environment mainly within New York City may negatively impact the performance of this portfolio.
OREO decreased $4.4 million to $7.7 million at March 31, 2025 from December 31, 2024, mostly due to the sale of one commercial real estate property, which resulted in a $2.9 million loss for the first quarter 2025. See Note 7 to the consolidated financial statements for additional information.
Although the timing of collection is uncertain, management believes that the majority of the non-accrual loans at March 31, 2025 are well secured and largely collectable, based in part on our quarterly review of collateral dependent loans and the valuation of the underlying collateral, if applicable. Any estimated shortfall in the net realizable value for collateral dependent loans is charged-off when a loan is 90 or 120 days past due or sooner if it is probable that a loan may not be fully collectable. For performing non-accrual loans, the collateral valuation shortfall results in an allocation of specific reserves within our allowance for credit losses for loans.
Allowance for Credit Losses for Loans
The ACL for loans includes the allowance for loan losses and the reserve for unfunded credit commitments. Under CECL, our methodology to establish the allowance for loan losses has two basic components: (i) a collective reserve component for estimated expected credit losses for pools of loans that share common risk characteristics and (ii) an individually evaluated reserve component for loans that do not share risk characteristics, consisting of collateral dependent loans. Valley also maintains a separate allowance for unfunded credit commitments mainly consisting of undisbursed non-cancellable lines of credit, new loan commitments and commercial standby letters of credit.
Valley estimates the collective ACL using a current expected credit losses methodology which is based on relevant information about historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the loan balances. In estimating the component of the allowance on a collective basis, we use a transition matrix model which calculates an expected life of loan loss percentage for each loan pool by using probability of default and loss given default metrics. The probability of default and loss given default metrics are adjusted using a scaling factor to incorporate a full economic cycle.
The expected life of loan loss percentages are determined by analyzing the migration of loans within the commercial and industrial loan categories from performing to loss by credit quality rating or delinquency categories using historical life-of-loan data for each loan portfolio pool, and by assessing the severity of loss based on the aggregate net lifetime losses incurred. The expected credit losses based on loss history are adjusted for qualitative factors. Among other things, these adjustments include and account for differences in: (i) the impact of the reasonable and supportable economic forecast, relative probability weightings and economic variables under each scenario and reversion period, (ii) other asset specific risks to the extent that they do not exist in the historical loss information, and (iii) net expected recoveries of charged-off loan balances.
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These adjustments are based on qualitative factors not reflected in the transition matrix but are likely to impact the measurement of estimated credit losses. The expected lifetime loss rate is the life of loan loss percentage from the transition matrix model plus the impact of the adjustments for qualitative factors. The expected credit losses are the product of multiplying the model’s expected lifetime loss rate by the exposure at default at period end on an undiscounted basis.
Valley utilizes a two-year reasonable and supportable forecast period followed by a one-year period over which estimated losses revert to historical loss experience on a straight-line basis for the remaining life of the loan. The forecast consists of multi-scenario economic forecasts to estimate future credit losses and are governed by a cross-functional committee. The committee meets each quarter to determine which economic scenarios developed by Moody's will be incorporated into the model, as well as the relative probability weightings of the selected scenarios, based upon all readily available information. The model projects economic variables under each scenario based on detailed statistical analyses. We have identified and selected key variables that most closely correlated to our historical credit performance, which include GDP, unemployment and the Case-Shiller Home Price Index.
Valley maintained the majority of its probability weighting used in the economic forecast to the Moody’s Baseline scenario with less emphasis on the S-3 downside and S-1 upside scenarios. The probability weightings were unchanged from December 31, 2024. At March 31, 2025, the standalone Moody's Baseline scenario, reflected a moderately weaker outlook as compared to December 31, 2024 in terms of most metrics highlighted below.
At March 31, 2025, Moody's Baseline forecast included the following specific assumptions:
•GDP expansion by about 1.7 percent in the second quarter 2025;
•Unemployment of 4.0 percent in the second quarter 2025 and 4.1 to 4.4 percent over the remainder of the forecast period ending in the first quarter 2027;
•The target federal funds rate range of 4.25 - 4.50 percent was unchanged from December 31, 2024 with two possible 25 basis point cuts in 2025;
•Inflation was at 2.4 percent in the March 31, 2025 driven by elevated shelter inflation. The inflation rate is expected to continue to grow at a slow rate during the year and to reach 2.7 percent by the end of 2025 and is projected to be around 2.3 percent in 2027; and
•A decline in business investment due to deceleration in GDP and the potential negative impact of tariffs and other uncertainty related to ongoing trade wars.
See more details regarding our allowance for credit losses for loans in Note 7 to the consolidated financial statements.
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The table below summarizes the relationship among loans, loans charged-off, loan recoveries, the provision for credit losses and the allowance for credit losses for loans for the periods indicated:
  Three Months Ended
March 31,
2025		 December 31,
2024		 March 31,
2024
  ($ in thousands)
Allowance for credit losses for loans
Beginning balance $ 573,328 $ 564,671 $ 465,550
Loans charged-off:
Commercial and industrial (28,456) (31,784) (14,293)
Commercial real estate (12,260) (69,218) (1,204)
Construction (1,163) — (7,594)
Residential mortgage — (29) —
Total consumer (2,140) (2,621) (1,809)
Total loans charged-off (44,019) (103,652) (24,900)
Charged-off loans recovered:
Commercial and industrial 810 1,452 682
Commercial real estate 249 3,138 241
Residential mortgage 168 81 25
Total consumer 843 673 397
Total loans recovered 2,070 5,344 1,345
Total net loan charge-offs (41,949) (98,308) (23,555)
Provision charged for credit losses 62,675 106,965 45,274
Ending balance $ 594,054 $ 573,328 $ 487,269
Components of allowance for credit losses for loans:
Allowance for loan losses $ 578,200 $ 558,850 $ 469,248
Allowance for unfunded credit commitments 15,854 14,478 18,021
Allowance for credit losses for loans $ 594,054 $ 573,328 $ 487,269
Components of provision for credit losses for loans:
Provision for credit losses for loans
$ 61,299 $ 108,831 $ 46,723
Provision (credit) for unfunded credit commitments
1,376 (1,866) (1,449)
Total provision for credit losses for loans $ 62,675 $ 106,965 $ 45,274
Allowance for credit losses for loans as a % of total loans
 1.22  % 1.17  % 0.98  %



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The following table presents the relationship among net loans charged-off and recoveries, and average loan balances outstanding for the periods indicated:
  Three Months Ended
  March 31, 2025 December 31, 2024 March 31, 2024
  ($ in thousands)
Net loan (charge-offs) recoveries
Commercial and industrial $ (27,646) $ (30,332) $ (13,611)
Commercial real estate (12,011) (66,080) (963)
Construction (1,163) — (7,594)
Residential mortgage 168 52 25
Total consumer (1,297) (1,948) (1,412)
Total $ (41,949) $ (98,308) $ (23,555)
Average loans outstanding
Commercial and industrial $ 9,996,024 $ 9,907,638 $ 9,235,707
Commercial real estate 26,328,971 26,845,025 28,259,701
Construction 3,054,230 3,779,916 3,693,343
Residential mortgage 5,639,313 5,685,802 5,600,135
Total consumer 3,636,383 3,511,749 3,457,705
Total $ 48,654,921 $ 49,730,130 $ 50,246,591
Annualized net loan charge-offs (recoveries) to average loans outstanding
Commercial and industrial 1.11% 1.22% 0.59%
Commercial real estate 0.18 0.98 0.01
Construction 0.15 0.00 0.82
Residential mortgage (0.01) 0.00 0.00
Total consumer 0.14 0.22 0.16
Total annualized net loan charge-offs to total average loans outstanding 0.34 0.79 0.19
Net loan charge-offs totaled $41.9 million for the first quarter 2025 as compared to $98.3 million and $23.6 million for the fourth quarter 2024 and first quarter 2024, respectively. Gross loan charge-offs for the first quarter 2025 included $24.1 million of partial and full charge-offs related to two non-performing commercial and industrial loan relationships with combined allocated reserves of $16.0 million at December 31, 2024.
Net loan charge-offs (as presented in the above table) declined from the fourth quarter 2024 and continued to trend within management's expectations for the credit quality of the loan portfolio at March 31, 2025.
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The following table summarizes the allocation of the allowance for credit losses for loans to loan portfolio categories and the allocations as a percentage of each loan category:
  March 31, 2025 December 31, 2024 March 31, 2024
  Allowance
Allocation		 Allocation
as a % of
Loan
Category		 Allowance
Allocation		 Allocation
as a % of
Loan
Category		 Allowance
Allocation		 Allocation
as a % of
Loan
Category
  ($ in thousands)
Loan Category:
Commercial and industrial loans $ 184,700  1.82  % $ 173,002  1.74  % $ 138,593  1.52  %
Commercial real estate loans:
Commercial real estate 266,938  1.02  251,351  0.95  209,355  0.74 
Construction 54,724  1.81  52,797  1.70  56,492  1.59 
Total commercial real estate loans 321,662  1.10  304,148  1.03  265,847  0.84 
Residential mortgage loans 48,906  0.87  58,895  1.05  44,377  0.79 
Consumer loans:
Home equity 3,401  0.56  3,379  0.56  2,809  0.50 
Auto and other consumer 19,531  0.62  19,426  0.65  17,622  0.60 
Total consumer loans 22,932  0.61  22,805  0.64  20,431  0.58 
Allowance for loan losses 578,200  1.19  558,850  1.15  469,248  0.94 
Allowance for unfunded credit commitments
 15,854  14,478  18,021 
Total allowance for credit losses for loans
 $ 594,054  $ 573,328  $ 487,269 
Allowance for credit losses for loans as a % of total loans 1.22  % 1.17  % 0.98  %
The allowance for credit losses for loans, comprised of our allowance for loan losses and unfunded credit commitments, as a percentage of total loans was 1.22 percent at March 31, 2025, 1.17 percent at December 31, 2024, and 0.98 percent at March 31, 2024. For the first quarter 2025, the provision for credit losses for loans totaled $62.7 million as compared to $107.0 million and $45.3 million for the fourth quarter 2024 and first quarter 2024, respectively. The first quarter 2025 provision reflects, among other factors, the impact of loan charge-offs, increased quantitative reserves and continued growth in the commercial and industrial loan portfolio, partially offset by a decrease in specific reserves associated with collateral dependent loans at March 31, 2025.
Capital Adequacy
A significant measure of the strength of a financial institution is its shareholders’ equity. At March 31, 2025 and December 31, 2024, shareholders' equity totaled approximately $7.5 billion and $7.4 billion, respectively, which represented 12.1 percent and 11.9 percent of total assets, respectively.
During the three months ended March 31, 2025, total shareholders’ equity increased by approximately $64.8 million primarily due to the following:
•net income of $106.1 million,
•other comprehensive income of $27.1 million,
•a $3.2 million increase attributable to the effect of our stock incentive plan, partially offset by
•cash dividends declared on common and preferred stock totaling a combined $69.4 million and
•repurchases of $2.2 million of our common stock held in treasury stock.
Valley and the Bank are subject to the regulatory capital requirements administered by the FRB and the OCC. Quantitative measures established by regulation to ensure capital adequacy require Valley and the Bank to maintain minimum amounts and ratios of common equity Tier 1 capital, total and Tier 1 capital to risk-weighted assets, and Tier 1 capital to average assets, as defined in the regulations.
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Valley is required to maintain a common equity Tier 1 capital to risk-weighted assets ratio of 4.5 percent, Tier 1 capital to risk-weighted assets ratio of 6.0 percent, ratio of total capital to risk-weighted assets of 8.0 percent, and a minimum leverage ratio of 4.0 percent, plus a 2.5 percent capital conservation buffer added to the minimum requirements for capital adequacy purposes. As of March 31, 2025 and December 31, 2024, Valley and Valley National Bank exceeded all capital adequacy requirements (see table below).
The following table presents Valley’s and Valley National Bank’s actual capital positions and ratios under Basel III risk-based capital guidelines at March 31, 2025 and December 31, 2024:
  Actual Minimum Capital
Requirements		 To Be Well Capitalized
Under Prompt Corrective
Action Provision
  Amount Ratio Amount Ratio Amount Ratio
 
 ($ in thousands)
As of March 31, 2025
Total Risk-based Capital
Valley $ 6,775,675  13.91  % $ 5,114,800  10.50  % N/A N/A
Valley National Bank 6,685,727  13.74  5,110,514  10.50  $ 4,867,156  10.00  %
Common Equity Tier 1 Capital
Valley 5,261,305  10.80  3,409,867  7.00  N/A N/A
Valley National Bank 6,149,462  12.63  3,407,009  7.00  3,163,651  6.50 
Tier 1 Risk-based Capital
Valley 5,615,372  11.53  4,140,553  8.50  N/A N/A
Valley National Bank 6,149,462  12.63  4,137,083  8.50  3,163,651  8.00 
Tier 1 Leverage Capital
Valley 5,615,372  9.41  2,387,732  4.00  N/A N/A
Valley National Bank 6,149,462  10.31  2,385,981  4.00  2,982,476  5.00 
As of December 31, 2024
Total Risk-based Capital
Valley $ 6,703,186  13.87  % $ 5,076,004  10.50  % N/A N/A
Valley National Bank 6,535,892  13.53  5,071,696  10.50  $ 4,830,187  10.00  %
Common Equity Tier 1 Capital
Valley 5,230,632  10.82  3,384,002  7.00  N/A N/A
Valley National Bank 6,041,434  12.51  3,381,131  7.00  3,139,621  6.50 
Tier 1 Risk-based Capital
Valley 5,584,699  11.55  4,109,146  8.50  N/A N/A
Valley National Bank 6,041,434  12.51  4,105,659  8.50  3,864,149  8.00 
Tier 1 Leverage Capital
Valley 5,584,699  9.16  2,438,649  4.00  N/A N/A
Valley National Bank 6,041,434  9.91  2,438,511  4.00  3,048,139  5.00 
For regulatory capital purposes, in accordance with the Federal Reserve Board’s final rule as of August 26, 2020, we deferred 100 percent of the CECL Day 1 impact to shareholders' equity plus 25 percent of the reserve build (i.e., provision for credit losses less net charge-offs) for a two-year period ending January 1, 2022. On January 1, 2022, the deferral amount totaling $47.3 million after-tax started to be phased-in by 25 percent and increased 25 percent per year until fully phased-in on January 1, 2025. As of March 31, 2025, the full deferral amount was recognized as a reduction to regulatory capital.
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As a result, the full impact decreased our risk-based capital ratios by approximately 11 basis points at March 31, 2025 compared to 9 basis points at December 31, 2024.
Typically, our primary source of capital growth is through retention of earnings. Our rate of earnings retention is derived by dividing undistributed earnings per common share by earnings (or net income available to common shareholders) per common share. Our retention ratio was approximately 38.9 percent for the three months ended March 31, 2025 as compared to 36.2 percent for the full year ended December 31, 2024.
Cash dividends declared amounted to $0.11 per common share for each of the three months ended March 31, 2025 and 2024. The Board is committed to examining and weighing relevant facts and considerations, including its commitment to shareholder value, each time it makes a cash dividend decision. The Federal Reserve has cautioned all bank holding companies about distributing dividends which may reduce the level of capital or not allow capital to grow considering the increased capital levels required under the Basel III rules. Prior to the date of this filing, Valley has received no objection or adverse guidance from the Federal Reserve or the OCC regarding the current level of its quarterly common stock dividend. However, the Federal Reserve has reiterated its long-standing guidance in recent years that banking organizations should consult them before declaring dividends in excess of earnings for the corresponding quarter. See Item 1A. Risk Factors of Valley's Annual Report for additional information.
Off-Balance Sheet Arrangements, Contractual Obligations and Other Matters
For a discussion of Valley’s off-balance sheet arrangements and contractual obligations see information included in Valley’s Annual Report in the MD&A section “Liquidity and Cash Requirements” and Notes 12 and 13 to the consolidated financial statements included in this report.

Item 3. Quantitative and Qualitative Disclosures About Market Risk
Market risk refers to potential losses arising from changes in interest rates, foreign exchange rates, equity prices, and commodity prices. Valley’s market risk is composed primarily of interest rate risk. See page 65 for a discussion of interest rate risk.

Item 4. Controls and Procedures
(a) Disclosure control and procedures. Valley maintains disclosure controls and procedures which, consistent with Rule 13a-15(e) under the Exchange Act, are defined to mean controls and other procedures that are designed to ensure that information required to be disclosed in the reports that Valley files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and to ensure that such information is accumulated and communicated to Valley’s management, including Valley’s Chief Executive Officer (CEO) and Chief Financial Officer (CFO), as appropriate, to allow timely decisions regarding required disclosure.
Valley’s CEO and CFO, with the assistance of other members of Valley’s management, have evaluated the effectiveness of Valley’s disclosure controls and procedures (as defined in Rule 13a-15(e) or Rule 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, Valley’s CEO and CFO have concluded that Valley’s disclosure controls and procedures were effective as of the end of the period covered by this report.
(b) Changes in internal control over financial reporting. Valley’s CEO and CFO have also concluded that there have not been any changes in Valley’s internal control over financial reporting in the quarter ended March 31, 2025 that have materially affected, or are reasonably likely to materially affect, Valley’s internal control over financial reporting.
81

Valley’s management, including the CEO and CFO, does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A system of internal control, no matter how well conceived and operated, provides reasonable, not absolute, assurance that the objectives of the system of internal control are met. The design of a system of internal control reflects resource constraints and the benefits of controls must be considered relative to their costs. Because there are inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within Valley have been or will be detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns occur because of a simple error or mistake. Controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of internal control is based in part upon certain assumptions about the likelihood of future events. There can be no assurance that any design will succeed in achieving its stated goals under all future conditions; over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with the policies or procedures. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

PART II - OTHER INFORMATION 
Item 1. Legal Proceedings
We are a party to various claims and legal actions in the ordinary course of our business. In the opinion of management, the ultimate resolution of such claims and legal actions, either individually or in the aggregate, will not have a material adverse effect on Valley’s financial condition, results of operations, or liquidity.

Item 1A. Risk Factors
There have been no material changes in the risk factors previously disclosed in the section titled “Risk Factors” in Part I, Item 1A of Valley’s Annual Report.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
During the quarter, we did not sell any equity securities not registered under the Securities Act of 1933, as amended. Purchases of equity securities by the issuer and affiliated purchasers during the three months ended March 31, 2025 were as follows:

ISSUER PURCHASES OF EQUITY SECURITIES 
Period Total  Number of
Shares  Purchased (1)		 Average
Price Paid
Per Share		 Total Number of Shares
Purchased as Part of
Publicly Announced
Plans (2)		 Maximum Number of
Shares that May Yet Be
Purchased Under the Plans (2)
January 1, 2025 to January 31, 2025 1,527  $ 8.93  —  25,000,000 
February 1, 2025 to February 28, 2025 686,318  10.21  —  25,000,000 
March 1, 2025 to March 31, 2025 251,421  8.65  250,000  24,750,000 
Total 939,266  $ 9.79  250,000    
(1)Includes repurchases made in connection with the vesting of employee restricted stock awards.
(2)On February 21, 2024, Valley publicly announced a new stock repurchase program for up to 25 million shares of Valley common stock. The authorization to repurchase under the new repurchase program became effective on April 26, 2024 and will expire on April 26, 2026.




82

Item 5. Other Information
a.None.
b.None.
c.During the three months ended March 31, 2025, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Item 6. Exhibits
(3) Articles of Incorporation and By-laws:
(3.1)
(3.2)
(3.3)
(31.1)
(31.2)
(32)
(101) Interactive Data File (XBRL Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) **
(104) Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
* Filed herewith.
** Furnished herewith.
83

SIGNATURES
Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
    VALLEY NATIONAL BANCORP
    (Registrant)
Date:     /s/ Ira Robbins
May 8, 2025     Ira Robbins
    Chairman of the Board and
    Chief Executive Officer
(Principal Executive Officer)
Date:     /s/ Travis Lan
May 8, 2025     Travis Lan
    Senior Executive Vice President and
    Chief Financial Officer
(Principal Financial Officer)
84
EX-31.1 2 vly-03312025ex311.htm EX-31.1 Document

EXHIBIT 31.1


CERTIFICATION
I, Ira Robbins, certify that:
1.    I have reviewed this Quarterly Report on Form 10-Q of Valley National Bancorp;
 
2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
 
4.    The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
 
a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)    Designed such internal control over financial reporting or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d)    Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.    The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

 Date: May 8, 2025
 
/s/ Ira Robbins
Ira Robbins
Chairman of the Board and
Chief Executive Officer
EX-31.2 3 vly-03312025ex312.htm EX-31.2 Document

EXHIBIT 31.2


I, Travis Lan, certify that:

1.    I have reviewed this Quarterly Report on Form 10-Q of Valley National Bancorp;
2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.    The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)    Designed such internal control over financial reporting or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)    Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d)    Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


 Date: May 8, 2025
/s/ Travis Lan
Travis Lan
Senior Executive Vice President and
Chief Financial Officer
EX-32 4 vly-03312025ex32.htm EX-32 Document

EXHIBIT 32


CERTIFICATION OF CEO AND CFO PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Valley National Bancorp (the “Company”) for the period ended March 31, 2025 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Ira Robbins, as Chief Executive Officer of the Company, and Travis Lan, as Chief Financial Officer of the Company, each hereby certify, pursuant to 18 U.S.C. (section) 1350, as adopted pursuant to (section) 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 
/s/ Ira Robbins
Ira Robbins
Chairman of the Board and
Chief Executive Officer
May 8, 2025
/s/ Travis Lan
Travis Lan
Senior Executive Vice President and
Chief Financial Officer
May 8, 2025