GlobeNewswire Inc | Oct 22, 2020 08:00AM EDT

October 22, 2020

NEW YORK, Oct. 22, 2020 (GLOBE NEWSWIRE) -- Valley National Bancorp (NASDAQ:VLY), the holding company for Valley National Bank, today reported net income for the third quarter 2020 of $102.4 million, or $0.25 per diluted common share, as compared to the third quarter 2019 earnings of $81.9 million, or $0.24 per diluted common share, and net income of $95.6 million, or $0.23 per diluted common share, for the second quarter 2020.

Key financial highlights for the third quarter:

-- Net Interest Income and Margin: Net interest income on a tax equivalent basis of $284.1 million for the third quarter 2020 increased $579 thousand as compared to the second quarter 2020. The increase was largely due to a 13 basis point decline in our funding costs caused by the continued downward repricing of our interest bearing deposits, partially offset by lower yields on new loan volumes and increased premium amortization expense related to mortgage-backed investment securities. Our net interest margin on a tax equivalent basis of 3.01 percent for the third quarter 2020 increased by 1 basis point from 3.00 percent for the second quarter 2020. See the "Net Interest Income and Margin" section below for additional information. -- Loan Portfolio: Loans increased $101.0 million, to $32.4 billion at September30, 2020 from June30, 2020. The increase was largely due to controlled growth in our commercial real estate loan portfolio and a $63 million increase in SBA Paycheck Protection Program (PPP) loans classified as commercial and industrial loans during the third quarter. Third quarter new and refinanced loan originations included approximately $386 million of residential mortgage loans originated for sale rather than investment as compared to $296 million of such loans in the second quarter 2020. Net gains on sales of residential loans were $13.4 million and $8.3 million in the third quarter 2020 and second quarter 2020, respectively. See the "Loans" section below for more details. -- Allowance and Provision for Credit Losses for Loans: The allowance for credit losses for loans totaled $335.3 million and $319.7 million at September30, 2020 and June30, 2020, respectively. During the third quarter 2020, the provision for credit losses for loans was $31.0 million as compared to $41.1 million and $8.7 million for the second quarter 2020 and third quarter 2019, respectively. The reserve build in the third quarter 2020 reflects several factors, including deterioration in Valley's macroeconomic outlook since the end of the second quarter, additional qualitative management adjustments to reflect the potential for higher levels of credit stress related to COVID-19 impacted borrowers, and the impact of lower valuations of collateral securing our non-performing taxi medallion loan portfolio. -- Credit Quality: Net loan charge-offs totaled $15.4 million for the third quarter 2020 as compared to $14.8 million for the second quarter 2020. Net charge-offs remained slightly elevated in the third quarter due to the full charge-off of a $6.0 million non-performing commercial and industrial loan relationship, as well as the partial charge-off of several taxi medallion loans negatively impacted by lower collateral valuations at September30, 2020. Non-accrual loans decreased $19.5 million during the third quarter 2020 as compared to the second quarter 2020 mostly due to the loan charge-offs, and represented 0.59 percent and 0.65 percent of total loans at September30, 2020 and June30, 2020, respectively. See the "Credit Quality" Section below for more details. -- Non-interest Income: Non-interest income increased $4.4 million to $49.3 million for the third quarter 2020 as compared to the second quarter 2020. The increase was mainly due to increases of $5.0 million, $4.5 million and $1.2 million in net gains on sales of residential mortgage loans, swap fee income related to new commercial loan transactions and net gains on sales of assets, respectively. BOLI income decreased $7.1 million as compared to the second quarter 2020 largely due to periodic death benefits received in the second quarter 2020 and a related credit adjustment to the mortality contingency reserves component of our BOLI assets recognized during the third quarter 2020. -- Loss on Extinguishment of Debt: In late September 2020, we prepaid $50 million of long-term institutional repo borrowings with an interest rate of 3.70 percent and an original contractual maturity date in January 2022. The debt prepayment was funded by excess cash liquidity. The transaction was accounted for as an early debt extinguishment resulting in a loss, reported within non-interest expense, of $2.4 million for the third quarter 2020. -- Non-interest Expense: Non-interest expense increased $3.0 million to $160.2 million for the third quarter 2020 as compared to the second quarter 2020 mainly due to a $5.1 million increase in salaries and employee benefits expense and the $2.4 million loss on extinguishment of debt recognized during the third quarter 2020. Salary and employee benefits increased due to several factors, including higher cash incentive accruals, increased medical and employer 401k expenses and a decline in compensation-based deferred loan origination costs caused by lower new loan volumes as compared to the second quarter 2020. The negative impact of these items were partially offset by decreases in net occupancy and equipment, the FDIC insurance assessment and COVID-19 related expenses. COVID-19 related expenses totaled $1.2 million and $2.2 million for third quarter 2020 and second quarter 2020, respectively. -- Efficiency Ratio: Our efficiency ratio was 48.20 percent for the third quarter 2020 as compared to 48.01 percent and 55.73 percent for the second quarter 2020 and third quarter 2019, respectively. Our adjusted efficiency ratio was 46.62 percent for the third quarter 2020 as compared to 46.84 percent and 53.48 percent for the second quarter 2020 and third quarter 2019, respectively. See the "Consolidated Financial Highlights" tables below for additional information regarding our non-GAAP measures. -- Performance Ratios: Annualized return on average assets (ROA), average shareholders equity (ROE) and average tangible shareholders' equity (ROTE) were 0.99 percent, 9.04 percent, and 13.30 percent for the third quarter 2020, respectively. Annualized ROA, ROE and ROTE, adjusted for non-core charges, were 1.01 percent, 9.20 percent, and 13.53 percent for the third quarter 2020, respectively. See the "Consolidated Financial Highlights" tables below for additional information regarding our non-GAAP measures.

Ira Robbins, CEO and President commented, "I'm pleased to note that our third quarter earnings reflect the strength of our balance sheet and Valley's ability to perform in a stressed economic environment. As a result of the strong performance of our margin, loan related gain and fee income and controlled operating expenses, the adjusted efficiency ratio was below 47 percent for the second consecutive quarter." Robbins continued, "During the quarter, we witnessed signs of improved financial health for many customers initially impacted by the COVID-19 pandemic and other positive trends from the reopening of certain markets, particularly in Florida. However, we continued to work closely with other customers requiring hardship relief, including loan forbearance, waived fees and other accommodations, when appropriate. While we face a difficult and uncertain road ahead, I remain confident that Valley's strong fundamentals and commitment to its customers, employees and communities will continue to standout in the future."

Net Interest Income and Margin

Net interest income on a tax equivalent basis totaling $284.1 million for the third quarter 2020 increased $62.4 million as compared to the third quarter 2019 and increased $579 thousand as compared to the second quarter 2020. Our third quarter 2020 net interest income results benefited from the prudent management of the level of interest rates offered on our deposits products, as well as a shift in customer preference towards deposits without stated maturities. Interest expense of $54.3 million for the third quarter 2020 decreased $11.7 million as compared to the second quarter 2020 largely due to the maturity and run-off of higher cost time deposits, reduced interest rates on all deposit products and a reduction in average short-term borrowings within our funding mix during the third quarter. Interest income in the third quarter 2020 decreased by $11.1 million as compared to the second quarter 2020 driven by (i) a $6.0 million decrease in interest income from our loan portfolio largely caused by new and refinanced loan originations at lower current interest rates and a moderate decline in discount accretion related to purchased credit deteriorated loans, and (ii) a $5.1 million decrease in interest and dividends from investment securities due to normal repayments of higher yielding securities and the acceleration of premium amortization expense related to the increased prepayment of mortgage-backed securities.

Our net interest margin on a tax equivalent basis of 3.01 percent for the third quarter 2020 increased by 1 basis point and 10 basis points from 3.00 percent and 2.91 percent for the second quarter 2020 and third quarter 2019, respectively. The yield on average interest earning assets decreased by 12 basis points on a linked quarter basis, mostly due to the impact of the lower interest rate environment. The yield on average loans decreased by 13 basis points to 3.89 percent for the third quarter 2020 as compared to the second quarter 2020 largely due to the continued repayment of higher yielding loans and the lower yield on new loans. The overall cost of average interest bearing liabilities decreased 16 basis points to 0.80 percent for the third quarter 2020 as compared to the linked second quarter 2020 due to the lower rates offered on deposit products, maturing time deposits and a decrease in average short-term borrowings. Our cost of total average deposits was 0.41 percent for the third quarter 2020 as compared to 0.60 percent for the second quarter 2020.

Loans, Deposits and Other Borrowings

Loans. Loans increased $101.0 million to approximately $32.4 billion at September30, 2020 from June30, 2020 largely due to commercial real estate loan growth and a $63 million increase in SBA PPP loans within the commercial and industrial loan category during the third quarter 2020. Commercial real estate loans increased $244 million, or 5.9 percent on an annualized basis, to $16.8 billion at September30, 2020 as compared to June30, 2020 mainly due to our solid loan commitment pipeline at June30, 2020 and slower repayment activity in the third quarter. The residential mortgage and most consumer loan categories experienced moderate declines in the third quarter due to the impact of COVID-19, including a higher level of residential mortgage loans originated for sale due to current interest rate risk management strategies. During the third quarter 2020, we originated $386 million of residential mortgage loans for sale rather than held for investment. Residential mortgage loans held for sale at fair value totaled $209.3 million and $120.6 million at September30, 2020 and June30, 2020, respectively.

Deposits. Total deposits decreased $132.2 million to approximately $31.3 billion at September30, 2020 from June30, 2020 largely due to decreases of $735.2 million and $232.9 million in time deposits and non-interest bearing deposits, respectively, which were mostly offset by an increase of $835.9 million in the money market, NOW and savings account category. The decrease in time deposits was driven by maturing high cost retail CDs and partial migration to more liquid deposit product categories, while the decline in non-interest bearing balances was partially caused by normal period end fluctuations and lower deposit balances with PPP loan customers. Total brokered deposits (consisting of both time and money market deposit accounts) totaled $3.3 billion at September30, 2020 as compared to $3.6 billion at June30, 2020. Non-interest bearing deposits; savings, NOW and money market deposits; and time deposits represented approximately 28 percent, 48 percent and 24 percent of total deposits as of September30, 2020, respectively.

Other Borrowings. Short-term borrowings decreased by $652.2 million to $1.4 billion at September30, 2020 as compared to June30, 2020 due to a decline in overnight borrowings, comprised mainly of federal funds purchased, and corresponding reduction in our excess liquidity levels which were prudently elevated by management in the first half of 2020. Long-term borrowings decreased by $55.0 million to $2.9 billion at September30, 2020 as compared to June30, 2020 mainly due to the prepayment of a $50 million institutional repo borrowing with a stated interest rate of 3.7 percent. The prepayment resulted in a $2.4 million prepayment penalty charge recognized in non-interest expense during the third quarter 2020.

Credit Quality

Non-Performing Assets (NPAs). Total NPAs, consisting of non-accrual loans, other real estate owned (OREO), other repossessed assets and non-accrual debt securities decreased $20.5 million to $203.6 million at September30, 2020 as compared to June30, 2020. The decrease in NPAs was mainly due to a $19.5 million decrease in non-accrual loans caused by loan charge-offs within the commercial and industrial loan category. Non-accrual loans represented 0.59 percent of total loans at September30, 2020 compared to 0.65 percent at June30, 2020.

Non-performing Taxi Medallion Loan Portfolio. We continue to closely monitor our non-performing New York City and Chicago taxi medallion loans totaling $93.1 million and $7.0 million, respectively, within the commercial and industrial loan portfolio at September30, 2020. At September30, 2020, the non-accrual taxi medallion loans totaling $100.1 million had related reserves of $60.4 million within the allowance for loan losses.

Accruing Past Due Loans. Total accruing past due loans (i.e., loans past due 30 days or more and still accruing interest) decreased $9.2 million to $83.9 million, or 0.26 percent of total loans, at September30, 2020 as compared to $93.1 million, or 0.29 percent of total loans, at June30, 2020 mainly due to a decline in residential mortgage and consumer loans in all delinquency categories. The decrease in the residential and consumer delinquencies was largely due to improved customer performance, including CARES Act qualifying forbearance loans that resumed their scheduled monthly payments during the third quarter 2020. Commercial real estate loans past due 30 to 59 days increased by $12.1 million as compared to June30, 2020 mainly due to three loan relationships with a combined total of $20.3 million reported in this delinquency category at September30, 2020. While the three loan relationships are internally classified as substandard, management believes they are well-secured and are currently in the process of collection.

Forbearance. In response to the COVID-19 pandemic and its economic impact to certain customers, Valley implemented short-term loan modifications such as payment deferrals, fee waivers, extensions of repayment terms, or delays in payment that are insignificant, when requested by customers. Generally, the modification terms allow for a deferral of payments for up to 90 days, which Valley may extend for an additional 90 days, for a maximum of 180 days on a cumulative and successive basis. As of September30, 2020, Valley had approximately $1.1 billion of outstanding loans remaining in their payment deferral period under short-term modifications.

Allowance for Credit Losses for Loans and Unfunded Commitments. The following table summarizes the allocation of the allowance for credit losses to loan categories and the allocation as a percentage of each loan category at September30, 2020, June30, 2020, and September30, 2019:

September 30, 2020 June 30, 2020 September 30, 2019 Allocation Allocation Allocation as a % of as a % of as a % of Allowance Loan Allowance Loan Allowance Loan Allocation* Category Allocation* Category Allocation* Category ($ in thousands)Loan Category: Commercial andindustrial $ 130,409 1.89 % $ 132,039 1.92 % $ 101,002 2.15 %loansCommercial real estate loans: Commercial 128,699 0.77 % 117,743 0.71 % 23,044 0.17 % real estate Construction 15,951 0.93 % 13,959 0.81 % 25,727 1.67 %Totalcommercial real 144,650 0.78 % 131,702 0.72 % 48,771 0.33 %estate loansResidential 28,614 0.67 % 29,630 0.67 % 5,302 0.13 %mortgage loansConsumer loans: Home equity 5,972 1.31 % 4,766 1.01 % 487 0.10 % Auto and other 15,387 0.69 % 11,477 0.51 % 6,291 0.27 % consumerTotal consumer 21,359 0.79 % 16,243 0.59 % 6,778 0.24 %loansAllowance for 325,032 1.00 % 309,614 0.96 % 161,853 0.61 %loan lossesAllowance forunfunded credit 10,296 10,109 2,917 commitmentsTotal allowancefor credit $ 335,328 $ 319,723 $ 164,770 losses forloansAllowance forcredit losses forloans as a % 1.03 % 0.99 % 0.62 %loans * CECL was adopted January 1, 2020. Prior periods reflect the allowance for credit losses for loans under the incurred loss model.

Our loan portfolio, totaling $32.4 billion at September30, 2020, had net loan charge-offs totaling $15.4 million for the third quarter 2020 as compared to $14.8 million and $2.0 million for the second quarter 2020 and third quarter 2019, respectively. During the third quarter 2020, net loan charge-offs were mainly driven by the full charge-off of a $6.0 million non-performing commercial and industrial loan relationship, which was fully reserved for in our allowance for loan losses at June 30, 2020. The commercial and industrial loan category also included partial charge-offs of taxi medallion loans totaling $6.1 million for the third quarter 2020 as compared to $3.2 million for the second quarter 2020. There were no taxi medallion loan charge-offs during the third quarter 2019.

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 1.03 percent, 0.99 percent and 0.62 percent at September30, 2020, June30, 2020 and September30, 2019, respectively. During the third quarter 2020, we recorded a $31.0 million provision for credit losses for loans as compared to $41.1 million and $8.7 million for the second quarter 2020 and the third quarter 2019, respectively. The reserve build in the third quarter 2020 reflects several factors, including deterioration in Valley's macroeconomic outlook since the end of the second quarter, additional qualitative management adjustments to reflect the potential for higher levels of credit stress related to COVID-19 impacted borrowers, and the impact of lower valuations of collateral securing our non-performing taxi medallion loan portfolio.

At September30, 2020, the allowance allocations for credit losses as a percentage of total loans increased for most loan categories as compared to June30, 2020. However, the allocated reserves as a percentage of commercial and industrial loans declined by 0.03 percent largely due to the aforementioned net loan charge-offs in the third quarter 2020, as well as moderate growth within the guaranteed PPP loan portfolio which had no related allowance at September30, 2020 and June30, 2020.

Capital Adequacy

Valley's regulatory capital ratios continue to reflect its well capitalized position. Valley's total risk-based capital, common equity Tier 1 capital, Tier 1 capital and Tier 1 leverage capital ratios were 12.36 percent, 9.70 percent, 10.41 percent and 7.87 percent, respectively, at September30, 2020.

For regulatory capital purposes, in connection with the Federal Reserve Boards final interim rule as of April 3, 2020, 100 percent of the CECL Day 1 impact to shareholders' equity equaling $28.2 million after-tax will be deferred for a two-year period ending January 1, 2022, at which time it will be phased in on a pro-rata basis over a three-year period ending January 1, 2025. Additionally, 25 percent of the reserve build (i.e., provision for credit losses less net charge-offs) for the nine months ended September 30, 2020 will be phased in over the same time frame.

Investor Conference Call

Valley will host a conference call with investors and the financial community at 11:00 AM Eastern Daylight Time, today to discuss the third quarter 2020 earnings. Those wishing to participate in the call may dial toll-free (866) 354-0432 Conference ID: 4969514. The teleconference will also be webcast live: https://edge.media-server.com/mmc/p/27hm6386 [ edge.media-server.com ] and archived on Valley's website through Friday, November 27, 2020.Investor presentation materials will be made available prior to the conference call at www.valley.com.

About Valley

As the principal subsidiary of Valley National Bancorp, Valley National Bank is a regional bank with approximately $41 billion in assets. Valley is committed to giving people and businesses the power to succeed. Valley operates many convenient branch locations across New Jersey, New York, Florida and Alabama, and is committed to providing the most convenient service, the latest innovations and an experienced and knowledgeable team dedicated to meeting customer needs. Helping communities grow and prosper is the heart of Valleys corporate citizenship philosophy. To learn more about Valley, go to www.valley.com or call our Customer Service Center at 800-522-4100.

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 managements confidence and strategies and managements expectations about new and existing programs and products, acquisitions, relationships, opportunities, taxation, technology, market conditions and economic expectations, including the potential effects of the COVID-19 pandemic on our businesses and financial results and conditions. These statements may be identified by such forward-looking terminology as should, expect, believe, view, opportunity, allow, continues, reflects, typically, usually, anticipate, 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. 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 COVID-19 on theU.S.and the global economies, including business disruptions, reductions in employment and an increase in business failures, specifically the consequences among our commercial and consumer customers; -- the impact of COVID-19 on our employees and our ability to provide services to our customers and respond to their needs as more cases of COVID-19 may arise in our primary markets; -- potential judgments, claims, damages, penalties, fines and reputational damage resulting from pending or future litigation and regulatory and government actions, including as a result of our participation in and execution of government programs related to the COVID-19 pandemic or as a result of our action, or failure to implement or effectively implement, federal, state and local laws, rules or executive orders requiring that we grant forbearances or not act to collect our loans; -- the impact of forbearances or deferrals we are required or agree to as a result of customer requests and/or government actions, including, but not limited to our potential inability to recover fully deferred payments from the borrower or the collateral; -- 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 or trademark infringement, employment related claims, and other matters; -- a prolonged downturn in the economy, mainly in New Jersey, New York, Florida and Alabama, as well as an unexpected decline in commercial real estate values within our market areas; -- 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 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; -- 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; -- the loss of or decrease in lower-cost funding sources within our deposit base, including our inability to achieve deposit retention targets under Valley's branch transformation strategy; -- cyber-attacks, computer viruses or other malware that may breach the security of our websites or other systems to obtain unauthorized access to confidential information, destroy data, disable or degrade service, or sabotage our systems; -- 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; -- 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, the COVID-19 pandemic or other external events; -- unexpected significant declines in the loan portfolio due to the lack of economic expansion, increased competition, large prepayments, changes in regulatory lending guidance or other factors; and -- the failure of other financial institutions with whom we have trading, clearing, counterparty and other financial relationships.

A detailed discussion of factors that could affect our results is included in our SEC filings, including the Risk Factors section of our Annual Report on Form 10-K for the year ended December31, 2019 and in Item 1A of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2020.

We undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in our expectations. 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.

-Tables to Follow-

VALLEY NATIONAL BANCORPCONSOLIDATED FINANCIAL HIGHLIGHTS

SELECTED FINANCIAL DATA

Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30,($ inthousands, 2020 2020 2019 2020 2019except forshare data)FINANCIAL DATA:Net interestincome - FTE $ 284,119 $ 283,540 $ 221,747 $ 834,042 $ 663,064 ^(1)Net interest $ 283,086 $ 282,559 $ 220,625 $ 830,984 $ 659,507 incomeNon-interest 49,272 44,830 41,150 135,499 176,426 incomeTotal revenue 332,358 327,389 261,775 966,483 835,933 Non-interest 160,185 157,166 145,877 473,007 435,409 expensePre-provision 172,173 170,223 115,898 493,476 400,524 net revenueProvision for 30,908 41,156 8,700 106,747 18,800 credit lossesIncome tax 38,891 33,466 25,307 101,486 110,035 expenseNet income 102,374 95,601 81,891 285,243 271,689 Dividends onpreferred 3,172 3,172 3,172 9,516 9,516 stockNet incomeavailable to $ 99,202 $ 92,429 $ 78,719 $ 275,727 $ 262,173 commonshareholdersWeightedaveragenumber of common sharesoutstanding:Basic 403,833,469 403,790,242 331,797,982 403,714,701 331,716,652 Diluted 404,788,526 404,631,845 333,405,196 404,912,126 333,039,436 Per common share data:Basic $ 0.25 $ 0.23 $ 0.24 $ 0.68 $ 0.79 earningsDiluted 0.25 0.23 0.24 0.68 0.79 earningsCashdividends 0.11 0.11 0.11 0.33 0.33 declaredClosing stock 8.33 9.60 11.21 11.46 11.21 price - highClosing stock 6.60 6.29 10.04 6.29 9.00 price - lowCORE ADJUSTEDFINANCIAL DATA: ^(2)Net incomeavailable tocommon $ 101,002 $ 92,721 $ 79,962 $ 278,784 $ 227,340 shareholders,as adjustedBasicearnings per 0.25 0.23 0.24 0.69 0.69 share, asadjustedDilutedearnings per 0.25 0.23 0.24 0.69 0.68 share, asadjustedFINANCIAL RATIOS:Net interest 3.00 % 2.99 % 2.89 % 3.02 % 2.93 %marginNet interestmargin - FTE 3.01 3.00 2.91 3.03 2.95 ^(1)Annualizedreturn on 0.99 0.92 0.98 0.94 1.10 averageassetsAnnualizedreturn onavg. 9.04 8.54 9.26 8.50 10.44 shareholders'equityAnnualizedreturn onavg. tangible 13.30 12.66 13.75 12.61 15.65 shareholders'equity ^(2)Efficiency 48.20 48.01 55.73 48.94 52.09 ratio ^(3)CORE ADJUSTEDFINANCIAL RATIOS: ^(2)Annualizedreturn onaverage 1.01 % 0.92 % 1.00 % 0.95 % 0.96 %assets, asadjustedAnnualizedreturn onaverage 9.20 8.57 9.40 8.59 9.10 shareholders'equity, asadjustedAnnualizedreturn onaveragetangible 13.53 12.70 13.96 12.75 13.65 shareholders'equity, asadjustedEfficiencyratio, as 46.62 46.84 53.48 47.53 54.27 adjusted VALLEY NATIONAL BANCORPCONSOLIDATED FINANCIAL HIGHLIGHTS Three Months Ended Nine Months EndedAVERAGEBALANCE SHEET September 30, June 30, September 30, September 30,ITEMS:(In 2020 2020 2019 2020 2019thousands)Assets $ 41,457,515 $ 41,503,514 $ 33,419,137 $ 40,356,828 $ 32,811,565 Interestearning 37,767,710 37,778,387 30,494,569 36,743,807 29,981,699 assetsLoans 32,515,264 32,041,200 26,136,745 31,522,268 25,651,195 Interestbearing 27,163,568 27,578,741 22,858,121 26,986,611 22,512,114 liabilitiesDeposits 31,491,471 30,837,963 24,836,349 30,384,511 24,772,979 Shareholders' 4,530,671 4,477,446 3,536,528 4,472,447 3,471,432 equity

As OfBALANCE SHEET September 30, June 30, March 31, December 31, September 30,ITEMS:(In 2020 2020 2020 2019 2019thousands)Assets $ 40,855,333 $ 41,717,265 $ 39,120,629 $ 37,436,020 $ 33,765,539 Total loans 32,415,586 32,314,611 30,428,067 29,699,208 26,567,159 Deposits 31,295,823 31,428,005 29,016,988 29,185,837 25,546,122 Shareholders' 4,533,763 4,474,488 4,420,998 4,384,188 3,558,075 equity LOANS: (In thousands)Commercialand $ 6,903,345 $ 6,884,689 $ 4,998,731 $ 4,825,997 $ 4,695,608 industrialCommercial real estate:Commercial 16,815,587 16,571,877 16,390,236 15,996,741 13,365,454 real estateConstruction 1,720,775 1,721,352 1,727,046 1,647,018 1,537,590 Totalcommercial 18,536,362 18,293,229 18,117,282 17,643,759 14,903,044 real estateResidential 4,284,595 4,405,147 4,478,982 4,377,111 4,133,331 mortgageConsumer: Home equity 457,083 471,115 481,751 487,272 489,808 Automobile 1,341,659 1,369,489 1,436,734 1,451,623 1,436,608 Other 892,542 890,942 914,587 913,446 908,760 consumerTotalconsumer 2,691,284 2,731,546 2,833,072 2,852,341 2,835,176 loansTotal loans $ 32,415,586 $ 32,314,611 $ 30,428,067 $ 29,699,208 $ 26,567,159 CAPITAL RATIOS:Book valueper common $ 10.71 $ 10.56 $ 10.43 $ 10.35 $ 10.09 shareTangible bookvalue per 7.12 6.96 6.82 6.73 6.62 common share^(2)Tangiblecommon equity 7.30 % 6.98 % 7.31 % 7.54 % 6.73 %to tangibleassets ^(2)Tier 1leverage 7.87 7.70 8.24 8.76 7.61 capitalCommon equitytier 1 9.70 9.51 9.24 9.42 8.49 capitalTier 1risk-based 10.41 10.23 9.95 10.15 9.30 capitalTotalrisk-based 12.36 12.19 11.53 11.72 11.03 capital

VALLEY NATIONAL BANCORPCONSOLIDATED FINANCIAL HIGHLIGHTS

Three Months Ended Nine Months EndedALLOWANCE SeptemberFOR CREDIT September 30, June 30, 30, September 30,LOSSES($ in 2020 2020 2019 2020 2019 thousands)Allowancefor credit losses forloansBeginning $ 319,723 $ 293,361 $ 158,079 $ 164,604 $ 156,295 balanceImpact ofthe adoption ? ? ? 37,989 ? of ASU2016-13 ^(4)Allowanceforpurchased ? ? ? 61,643 ? creditdeteriorated(PCD) loansBeginningbalance, 319,723 293,361 158,079 264,236 156,295 adjustedLoanscharged-off ^(5):Commercialand (13,965 ) (14,024 ) (527 ) (31,349 ) (7,882 )industrialCommercial (695 ) (27 ) (158 ) (766 ) (158 )real estateResidential (7 ) (5 ) (111 ) (348 ) (126 )mortgageTotal (2,458 ) (2,601 ) (2,191 ) (7,624 ) (5,971 )ConsumerTotal loans (17,125 ) (16,657 ) (2,987 ) (40,087 ) (14,137 )charged-offCharged-offloans recovered ^(5):Commercialand 428 799 330 1,796 2,008 industrialCommercial 60 31 28 164 71 real estateConstruction 40 20 ? 80 ? Residential 31 545 3 626 13 mortgageTotal 1,151 509 617 2,454 1,720 ConsumerTotal loans 1,710 1,904 978 5,120 3,812 recoveredNet (15,415 ) (14,753 ) (2,009 ) (34,967 ) (10,325 )charge-offsProvisionfor credit 31,020 41,115 8,700 106,059 18,800 losses forloansEnding $ 335,328 $ 319,723 $ 164,770 $ 335,328 $ 164,770 balanceComponentsof allowancefor credit losses forloans:Allowancefor loan $ 325,032 $ 309,614 $ 161,853 $ 325,032 $ 161,853 lossesAllowancefor unfunded 10,296 10,109 2,917 10,296 2,917 creditcommitmentsAllowancefor credit $ 335,328 $ 319,723 $ 164,770 $ 335,328 $ 164,770 losses forloansComponentsof provisionfor credit losses forloans:Provisionfor credit $ 30,833 $ 41,025 $ 8,757 $ 105,709 $ 20,319 losses forloansProvisionfor unfundedcredit 187 90 (57 ) 350 (1,519 )commitments^(6)Totalprovisionfor credit $ 31,020 $ 41,115 $ 8,700 $ 106,059 $ 18,800 losses forloansAnnualizedratio oftotal net 0.19 % 0.18 % 0.03 % 0.15 % 0.05 %charge-offsto averageloansAllowancefor creditlosses for 1.03 0.99 0.62 1.03 0.62 loans as a %of totalloans

VALLEY NATIONAL BANCORPCONSOLIDATED FINANCIAL HIGHLIGHTS

As ofASSET QUALITY: September June 30, March 31, December September^(7) 30, 31, 30,($ in 2020 2020 2020 2019 2019thousands)Accruing past due loans:30 to 59 days past due:Commercial and $ 6,587 $ 6,206 $ 9,780 $ 11,700 $ 5,702 industrialCommercial 26,038 13,912 41,664 2,560 20,851 real estateConstruction 142 ? 7,119 1,486 11,523 Residential 22,528 35,263 38,965 17,143 12,945 mortgageTotal Consumer 8,979 12,962 19,508 13,704 13,079 Total 30 to 59 64,274 68,343 117,036 46,593 64,100 days past due60 to 89 days past due:Commercial and 3,954 4,178 7,624 2,227 3,158 industrialCommercial 610 1,543 15,963 4,026 735 real estateConstruction ? ? 49 1,343 7,129 Residential 3,760 4,169 9,307 4,192 4,417 mortgageTotal Consumer 1,352 3,786 2,309 2,527 1,577 Total 60 to 89 9,676 13,676 35,252 14,315 17,016 days past due90 or more days past due:Commercial and 6,759 5,220 4,049 3,986 4,133 industrialCommercial 1,538 ? 161 579 1,125 real estateResidential 891 3,812 1,798 2,042 1,347 mortgageTotal Consumer 753 2,082 1,092 711 756 Total 90 ormore days past 9,941 11,114 7,100 7,318 7,361 dueTotal accruing $ 83,891 $ 93,133 $ 159,388 $ 68,226 $ 88,477 past due loansNon-accrual loans:Commercial and $ 115,667 $ 130,876 $ 132,622 $ 68,636 $ 75,311 industrialCommercial 41,627 43,678 41,616 9,004 9,560 real estateConstruction 2,497 3,308 2,972 356 356 Residential 23,877 25,776 24,625 12,858 13,772 mortgageTotal Consumer 7,441 6,947 4,095 2,204 2,050 Totalnon-accrual 191,109 210,585 205,930 93,058 101,049 loansOther realestate owned 7,746 8,283 10,198 9,414 6,415 (OREO)Otherrepossessed 3,988 3,920 3,842 1,276 2,568 assetsNon-accrualdebt 783 1,365 531 680 680 securitiesTotalnon-performing $ 203,626 $ 224,153 $ 220,501 $ 104,428 $ 110,712 assetsPerformingtroubled debt $ 58,090 $ 53,936 $ 48,024 $ 73,012 $ 79,364 restructuredloansTotalnon-accrual 0.59 % 0.65 % 0.68 % 0.31 % 0.38 %loans as a %of loansTotal accruingpast due andnon-accrual 0.85 % 0.94 % 1.20 % 0.54 % 0.71 %loans as a %of loansAllowance forlosses onloans as a % 170.08 % 147.03 % 137.59 % 173.83 % 160.17 %of non-accrualloans

VALLEY NATIONAL BANCORPCONSOLIDATED FINANCIAL HIGHLIGHTS

NOTES TO SELECTED FINANCIAL DATA

Net interest income and net interest margin are presented on a tax equivalent basis using a 21 percent federal tax rate. Valley believes(1 ) that this presentation provides comparability of net interest income and net interest margin arising from both taxable and tax-exempt sources and is consistent with industry practice and SEC rules. This press release contains certain supplemental financial information, described in the Notes below, which has been determined by methods other than U.S. Generally Accepted Accounting Principles ("GAAP") that management uses in its analysis of Valley's performance. Management believes these non-GAAP financial measures provide information useful to investors in understanding Valley's financial results. Specifically, Valley provides measures based on what it believes are its operating earnings on a consistent basis and excludes material non-core operating items which affect the GAAP reporting of results of operations. Management utilizes these measures for internal planning and forecasting(2 ) purposes. Management believes that Valley's presentation and discussion, together with the accompanying reconciliations, provides a complete understanding of factors and trends affecting Valley's business and allows investors to view performance in a manner similar to management. These non-GAAP measures should not be considered a substitute for GAAP basis measures and results and Valley strongly encourages investors to review its consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.

Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30,($ inthousands, 2020 2020 2019 2020 2019except forshare data)Adjusted netincomeavailable to commonshareholders:Net income, as $ 102,374 $ 95,601 $ 81,891 $ 285,243 $ 271,689 reportedLess: Gain onsale leasebacktransactions ? ? ? ? (55,707 ) (net of tax)^(a)Add: Loss onextinguishment 1,691 ? ? 1,691 ? of debt (netof tax)Add: Netimpairmentlosses on ? ? ? ? 2,078 securities(net of tax)Add: Losses onsecurities 33 29 67 91 82 transaction(net of tax)Add: Severanceexpense (net ? ? ? ? 3,433 of tax)^(b)Add: Taxcreditinvestment ? ? ? ? 1,757 impairment(net of tax)^(c)Add: Mergerrelated 76 263 1,043 1,275 1,068 expenses (netof tax)^(d)Add: Incometax expense ^ ? ? 133 ? 12,456 (e)Net income, as $ 104,174 $ 95,893 $ 83,134 $ 288,300 $ 236,856 adjustedDividends onpreferred 3,172 3,172 3,172 9,516 9,516 stockNet incomeavailable tocommon $ 101,002 $ 92,721 $ 79,962 $ 278,784 $ 227,340 shareholders,as adjusted__________ (a) The gain on sale leaseback transactions is included in gains on the sales of assets within other non-interest income.(b) Severance expense is included in salary and employee benefits expense.(c) Impairment is included in the amortization of tax credit investments.(d) Merger related expenses are primarily within salary and employee benefitsexpense, professional and legal fees, and other expense.(e) Income tax expense related to reserves for uncertain tax positions.Adjusted percommon share data:Net incomeavailable tocommon $ 101,002 $ 92,721 $ 79,962 $ 278,784 $ 227,340 shareholders,as adjustedAverage numberof shares 403,833,469 403,790,242 331,797,982 403,714,701 331,716,652 outstandingBasicearnings, as $ 0.25 $ 0.23 $ 0.24 $ 0.69 $ 0.69 adjustedAverage numberof diluted 404,788,526 404,631,845 333,405,196 404,912,126 333,039,436 sharesoutstandingDilutedearnings, as $ 0.25 $ 0.23 $ 0.24 $ 0.69 $ 0.68 adjustedAdjustedannualizedreturn onaverage tangibleshareholders'equity:Net income, as $ 104,174 $ 95,893 $ 83,134 $ 288,300 $ 236,856 adjustedAverageshareholders' 4,530,671 4,477,446 3,536,528 4,472,447 3,471,432 equityLess: Averagegoodwill andother 1,451,889 1,456,781 1,154,462 1,456,536 1,157,203 intangibleassetsAveragetangible $ 3,078,782 $ 3,020,665 $ 2,382,066 $ 3,015,911 $ 2,314,229 shareholders'equityAnnualizedreturn onaveragetangible 13.53 % 12.70 % 13.96 % 12.75 % 13.65 %shareholders'equity, asadjustedAdjustedannualizedreturn on averageassets:Net income, as $ 104,174 $ 95,893 $ 83,134 $ 288,300 $ 236,856 adjustedAverage assets $ 41,457,515 $ 41,503,514 $ 33,419,137 $ 40,356,828 $ 32,811,565 Annualizedreturn onaverage 1.01 % 0.92 % 1.00 % 0.95 % 0.96 %assets, asadjusted

VALLEY NATIONAL BANCORPCONSOLIDATED FINANCIAL HIGHLIGHTS

Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30,($ in 2020 2020 2019 2020 2019thousands)Adjustedannualizedreturn on averageshareholders'equity:Net income, as $ 104,174 $ 95,893 $ 83,134 $ 288,300 $ 236,856 adjustedAverageshareholders' $ 4,530,671 $ 4,477,446 $ 3,536,528 $ 4,472,447 $ 3,471,432 equityAnnualizedreturn onaverage 9.20 % 8.57 % 9.40 % 8.59 % 9.10 %shareholders'equity, asadjustedAnnualizedreturn onaverage tangibleshareholders'equity:Net income, as $ 102,374 $ 95,601 $ 81,891 $ 285,243 $ 271,689 reportedAverageshareholders' 4,530,671 4,477,446 3,536,528 4,472,447 3,471,432 equityLess: Averagegoodwill andother 1,451,889 1,456,781 1,154,462 1,456,536 1,157,203 intangibleassetsAveragetangible $ 3,078,782 $ 3,020,665 $ 2,382,066 $ 3,015,911 $ 2,314,229 shareholders'equityAnnualizedreturn onaverage 13.30 % 12.66 % 13.75 % 12.61 % 15.65 %tangibleshareholders'equityAdjustedefficiency ratio:Non-interestexpense, as $ 160,185 $ 157,166 $ 145,877 $ 473,007 $ 435,409 reportedLess: Loss onextinguishment 2,353 ? ? 2,353 ? of debt(pre-tax)Less:Severance ? ? ? ? 4,838 expense(pre-tax)Less:Merger-related 106 366 1,434 1,774 1,469 expenses(pre-tax)Less:Amortizationof tax credit 2,759 3,416 4,385 9,403 16,421 investments(pre-tax)Non-interestexpense, as $ 154,967 $ 153,384 $ 140,058 $ 459,477 $ 412,681 adjustedNet interest 283,086 282,559 220,625 830,984 659,507 incomeNon-interestincome, as 49,272 44,830 41,150 135,499 176,426 reportedAdd: Netimpairmentlosses on ? ? ? ? 2,928 securities(pre-tax)Add: Losses onsecurities 46 41 93 127 114 transactions,net (pre-tax)Less: Gain onsale leaseback ? ? ? ? 78,505 transaction(pre-tax)Non-interestincome, as $ 49,318 $ 44,871 $ 41,243 $ 135,626 $ 100,963 adjustedGrossoperating $ 332,404 $ 327,430 $ 261,868 $ 966,610 $ 760,470 income, asadjustedEfficiencyratio, as 46.62 % 46.84 % 53.48 % 47.53 % 54.27 %adjusted

VALLEY NATIONAL BANCORPCONSOLIDATED FINANCIAL HIGHLIGHTS

As of September 30, June 30, March 31, December 31, September 30,($ inthousands, 2020 2020 2020 2019 2019except forshare data)Tangible bookvalue per common share:Common shares 403,878,744 403,795,699 403,744,148 403,278,390 331,805,564 outstandingShareholders' $ 4,533,763 $ 4,474,488 $ 4,420,998 $ 4,384,188 $ 3,558,075 equityLess:Preferred 209,691 209,691 209,691 209,691 209,691 stockLess:Goodwill andother 1,449,282 1,453,330 1,458,095 1,460,397 1,152,815 intangibleassetsTangiblecommon $ 2,874,790 $ 2,811,467 $ 2,753,212 $ 2,714,100 $ 2,195,569 shareholders'equityTangible bookvalue per $ 7.12 $ 6.96 $ 6.82 $ 6.73 $ 6.62 common shareTangible common equity to tangible assets:Tangiblecommon $ 2,874,790 $ 2,811,467 $ 2,753,212 $ 2,714,100 $ 2,195,569 shareholders'equityTotal assets 40,855,333 41,717,265 39,120,629 37,436,020 33,765,539 Less:Goodwill andother 1,449,282 1,453,330 1,458,095 1,460,397 1,152,815 intangibleassetsTangible $ 39,406,051 $ 40,263,935 $ 37,662,534 $ 35,975,623 $ 32,612,724 assetsTangiblecommon equity 7.30 % 6.98 % 7.31 % 7.54 % 6.73 %to tangibleassets

(3 ) The efficiency ratio measures Valley's total non-interest expense as a percentage of net interest income plus total non-interest income. The adjustment represents an increase in the allowance for credit losses(4 ) for loans as a result of the adoption of ASU 2016-13 effective January 1, 2020.(5 ) Charge-offs and recoveries presented for periods prior to March 31, 2020 exclude loans formerly known as Purchased Credit-Impaired (PCI) loans.(6 ) Periods prior to March 31, 2020 represent allowance and provision for letters of credit only. Past due loans and non-accrual loans presented in periods prior to March(7 ) 31, 2020 exclude PCI loans. PCI loans were accounted for on a pool basis and are were not subject to delinquency classification.

SHAREHOLDERS RELATIONSRequests for copies of reports and/or other inquiries should be directed toTina Zarkadas, Assistant Vice President, Shareholder Relations Specialist,Valley National Bancorp, 1455 Valley Road, Wayne, New Jersey, 07470, bytelephone at (973) 305-3380, by fax at (973) 305-1364 or by e-mail attzarkadas@valley.com.

VALLEY NATIONAL BANCORPCONSOLIDATED STATEMENTS OF FINANCIAL CONDITION(in thousands, except for share data)

September 30, December 31, 2020 2019 (Unaudited) Assets Cash and due from banks $ 383,961 $ 256,264 Interest bearing deposits with banks 654,591 178,423 Investment securities: Equity securities 29,026 41,410 Available for sale debt securities 1,526,564 1,566,801 Held to maturity debt securities (net ofallowance for credit losses of $1,481 at 2,168,995 2,336,095 September 30, 2020)Total investment securities 3,724,585 3,944,306 Loans held for sale, at fair value 209,250 76,113 Loans 32,415,586 29,699,208 Less: Allowance for loan losses (325,032 ) (161,759 )Net loans 32,090,554 29,537,449 Premises and equipment, net 323,056 334,533 Lease right of use assets 265,599 285,129 Bank owned life insurance 533,768 540,169 Accrued interest receivable 136,058 105,637 Goodwill 1,375,409 1,373,625 Other intangible assets, net 73,873 86,772 Other assets 1,084,629 717,600 Total Assets $ 40,855,333 $ 37,436,020 Liabilities Deposits: Non-interest bearing $ 8,756,924 $ 6,710,408 Interest bearing: Savings, NOW and money market 15,001,318 12,757,484 Time 7,537,581 9,717,945 Total deposits 31,295,823 29,185,837 Short-term borrowings 1,430,726 1,093,280 Long-term borrowings 2,852,569 2,122,426 Junior subordinated debentures issued to 55,978 55,718 capital trustsLease liabilities 290,441 309,849 Accrued expenses and other liabilities 396,033 284,722 Total Liabilities 36,321,570 33,051,832 Shareholders? Equity Preferred stock, no par value; 50,000,000 authorized shares:Series A (4,600,000 shares issued at September 111,590 111,590 30, 2020 and December 31, 2019)Series B (4,000,000 shares issued at September 98,101 98,101 30, 2020 and December 31, 2019)Common stock (no par value, authorized650,000,000 shares; issued 403,880,132 shares 141,718 141,423 at September 30, 2020 and 403,322,773 shares atDecember 31, 2019)Surplus 3,633,321 3,622,208 Retained earnings 553,826 443,559 Accumulated other comprehensive loss (4,783 ) (32,214 )Treasury stock, at cost (1,388 common shares atSeptember 30, 2020 and 44,383 common shares at (10 ) (479 )December 31, 2019)Total Shareholders? Equity 4,533,763 4,384,188 Total Liabilities and Shareholders? Equity $ 40,855,333 $ 37,436,020

VALLEY NATIONAL BANCORPCONSOLIDATED STATEMENTS OF INCOME (Unaudited)(in thousands, except for share data)

Three Months Ended Nine Months Ended September June 30, September September 30, 30, 30, 2020 2020 2019 2020 2019Interest Income Interest and fees on $ 315,788 $ 321,883 $ 298,384 $ 970,739 $ 883,595 loansInterest anddividends on investmentsecurities:Taxable 14,845 19,447 21,801 56,225 67,166 Tax-exempt 3,606 3,692 4,219 11,224 13,379 Dividends 2,684 3,092 3,171 9,177 9,140 Interest on federalfunds sold and other 420 411 1,686 2,296 3,947 short-terminvestmentsTotal interest 337,343 348,525 329,261 1,049,661 977,227 incomeInterest Expense Interest on deposits:Savings, NOW and 13,323 16,627 35,944 64,463 110,247 money marketTime 19,028 29,857 42,848 91,699 121,350 Interest onshort-term 2,588 1,980 12,953 9,275 40,362 borrowingsInterest onlong-term borrowingsand junior 19,318 17,502 16,891 53,240 45,761 subordinateddebenturesTotal interest 54,257 65,966 108,636 218,677 317,720 expenseNet Interest Income 283,086 282,559 220,625 830,984 659,507 Provision for creditlosses for held to (112 ) 41 ? 688 ? maturity securitiesProvision for credit 31,020 41,115 8,700 106,059 18,800 losses for loansNet Interest IncomeAfter Provision for 252,178 241,403 211,925 724,237 640,707 Credit LossesNon-Interest Income Trust and investment 3,068 2,826 3,296 9,307 9,296 servicesInsurance 1,816 1,659 2,748 5,426 7,922 commissionsService charges on 3,952 3,557 5,904 13,189 17,634 deposit accountsLosses on securities (46 ) (41 ) (93 ) (127 ) (114 )transactions, netOther-than-temporaryimpairment losses on ? ? ? ? (2,928 )securitiesFees from loan 2,551 2,227 2,463 7,526 7,260 servicingGains on sales of 13,366 8,337 5,194 26,253 13,700 loans, netGains (losses) on 894 (299 ) (159 ) 716 76,997 sales of assets, netBank owned life (1,304 ) 5,823 2,687 7,661 6,779 insuranceOther 24,975 20,741 19,110 65,548 39,880 Total non-interest 49,272 44,830 41,150 135,499 176,426 incomeNon-Interest Expense Salary and employee 83,626 78,532 77,271 247,886 236,559 benefits expenseNet occupancy and 31,116 33,217 29,203 96,774 86,789 equipment expenseFDIC insurance 4,847 6,135 5,098 14,858 16,150 assessmentAmortization ofother intangible 6,377 6,681 4,694 18,528 13,175 assetsProfessional and 8,762 7,797 5,870 22,646 15,286 legal feesLoss onextinguishment of 2,353 ? ? 2,353 ? debtAmortization of tax 2,759 3,416 4,385 9,403 16,421 credit investmentsTelecommunication 2,094 2,866 2,698 7,247 7,317 expenseOther 18,251 18,522 16,658 53,312 43,712 Total non-interest 160,185 157,166 145,877 473,007 435,409 expenseIncome Before Income 141,265 129,067 107,198 386,729 381,724 TaxesIncome tax expense 38,891 33,466 25,307 101,486 110,035 Net Income 102,374 95,601 81,891 285,243 271,689 Dividends on 3,172 3,172 3,172 9,516 9,516 preferred stockNet Income Availableto Common $ 99,202 $ 92,429 $ 78,719 $ 275,727 $ 262,173 Shareholders

VALLEY NATIONAL BANCORPCONSOLIDATED STATEMENTS OF INCOME (Unaudited)(in thousands, except for share data)

Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, 2020 2020 2019 2020 2019Earnings PerCommon Share:Basic $ 0.25 $ 0.23 $ 0.24 $ 0.68 $ 0.79 Diluted 0.25 0.23 0.24 0.68 0.79 CashDividends 0.11 0.11 0.11 0.33 0.33 Declared perCommon ShareWeightedAverageNumber of CommonSharesOutstanding:Basic 403,833,469 403,790,242 331,797,982 403,714,701 331,716,652 Diluted 404,788,526 404,631,845 333,405,196 404,912,126 333,039,436

VALLEY NATIONAL BANCORPQuarterly Analysis of Average Assets, Liabilities and Shareholders' Equity andNet Interest Income on a Tax Equivalent Basis

Three Months Ended September 30, 2020 June 30, 2020 September 30, 2019 Average Avg. Average Avg. Average Avg.($ in thousands) Balance Interest Rate Balance Interest Rate Balance Interest RateAssets Interest earning assets:Loans ^(1)(2) $ 32,515,264 $ 315,863 3.89 % $ 32,041,200 $ 321,883 4.02 % $ 26,136,745 $ 298,384 4.57 %Taxable investments 3,354,373 17,529 2.09 3,673,090 22,539 2.45 3,411,330 24,972 2.93 ^(3)Tax-exempt 542,450 4,564 3.37 562,172 4,673 3.32 632,709 5,341 3.38 investments ^(1)(3)Interest bearing 1,355,623 420 0.12 1,501,925 411 0.11 313,785 1,686 2.15 deposits with banksTotal interest 37,767,710 338,376 3.58 37,778,387 349,506 3.70 30,494,569 330,383 4.33 earning assetsOther assets 3,689,805 3,725,127 2,924,568 Total assets $ 41,457,515 $ 41,503,514 $ 33,419,137 Liabilities andshareholders' equityInterest bearing liabilities:Savings, NOW andmoney market $ 14,643,248 $ 13,323 0.36 % $ 13,788,951 $ 16,627 0.48 % $ 11,065,959 $ 35,944 1.30 %depositsTime deposits 8,027,346 19,028 0.95 8,585,782 29,857 1.39 7,383,202 42,848 2.32 Short-term 1,533,246 2,588 0.68 2,317,992 1,980 0.34 2,265,528 12,953 2.29 borrowingsLong-term 2,959,728 19,318 2.61 2,886,016 17,502 2.43 2,143,432 16,891 3.15 borrowings^ (4)Total interest 27,163,568 54,257 0.80 27,578,741 65,966 0.96 22,858,121 108,636 1.90 bearing liabilitiesNon-interest 8,820,877 8,463,230 6,387,188 bearing depositsOther liabilities 942,399 984,097 637,300 Shareholders' 4,530,671 4,477,446 3,536,528 equityTotal liabilitiesand shareholders' $ 41,457,515 $ 41,503,514 $ 33,419,137 equity Net interest income/interest rate $ 284,119 2.78 % $ 283,540 2.74 % $ 221,747 2.43 %spread ^(5)Tax equivalent (1,033 ) (981 ) (1,122 ) adjustmentNet interest $ 283,086 $ 282,559 $ 220,625 income, as reportedNet interest margin 3.00 2.99 2.89 ^(6)Tax equivalent 0.01 0.01 0.02 effectNet interest marginon a fully tax 3.01 % 3.00 % 2.91 %equivalent basis ^(6)

____________(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 available for sale 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 condition. Interest rate spread represents the difference between the average yield on(5) 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.

Contact: Michael D. Hagedorn Senior Executive Vice President and Chief Financial Officer 973-872-4885