Valley National Bancorp beats Q3 estimates as profitability improves

NEW YORK - On Thursday, Valley National Bancorp (NASDAQ:VLY) reported third quarter earnings that beat analyst expectations, with adjusted earnings per share of $0.28 compared to the consensus estimate of $0.26. Revenue came in at $511.1 million, slightly above the $510.9 million analysts had forecast.

The company’s shares fell 1.28% in pre-market trading following the announcement.

Net income for the quarter reached $163.4 million, representing a significant improvement from $97.9 million in the same quarter last year. The bank’s net interest margin increased by 4 basis points to 3.05% compared to the previous quarter, while net interest income rose to $447.5 million, up $13.8 million from the second quarter and $35.7 million from the year-ago period.

"This quarter’s results reflect Valley’s strong momentum as our profitability improvement is catching up to the balance sheet strengthening that has occurred since the beginning of 2024," said CEO Ira Robbins. "New additions to our leadership team have already begun to positively impact our business generation, talent base, and strategic operating model."

Total deposits increased by $450.5 million to $51.2 billion, while loans decreased slightly by $118.6 million to $49.3 billion. The bank’s efficiency ratio improved to 53.37% from 55.20% in the previous quarter, reflecting better operational performance.

Credit quality showed mixed signals, with non-accrual loans increasing to $421.5 million, or 0.86% of total loans, compared to $354.4 million, or 0.72% of total loans, in the previous quarter. However, the provision for credit losses decreased to $19.2 million from $37.8 million in the second quarter.

Valley National’s capital position strengthened with its total risk-based capital ratio improving to 13.83% from 13.67% in the previous quarter. During the third quarter, the bank repurchased 1.3 million shares of common stock at an average price of $9.38.

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