EXHIBIT 99.1
vlylogoa01a16.gif
 
News Release




FOR IMMEDIATE RELEASE
Contact:
 
Alan D. Eskow
 
 
 
Senior Executive Vice President and
 
 
 
Chief Financial Officer
 
 
 
973-305-4003

VALLEY NATIONAL BANCORP REPORTS INCREASED SECOND QUARTER
NET INCOME AND STRONG ORGANIC LOAN GROWTH

WAYNE, NJ – July 26, 2018 -- Valley National Bancorp (NYSE:VLY), the holding company for Valley National Bank, today reported net income for the second quarter of 2018 of $72.8 million, or $0.21 per diluted common share, as compared to the second quarter of 2017 earnings of $50.1 million, or $0.18 per diluted common share, and net income of $42.0 million, or $0.12 per diluted common share, for the first quarter of 2018. Net income for second quarter of 2018 included merger charges of $3.2 million ($2.3 million after-tax) related to our acquisition of USAmeriBancorp, Inc. ("USAB") effective January 1, 2018. The first quarter of 2018 results also included infrequent charges of $26.0 million ($19.2 million after-tax) which mainly consisted of $13.5 million of USAB merger expenses and a $10.5 million increase in litigation reserves. Excluding these charges and other non-core items, our adjusted net income was $75.2 million, or $0.22 per diluted common share, for the second quarter of 2018, and $61.7 million, or $0.18 per diluted common share, for the first quarter of 2018. See further details below, including the "Consolidated Financial Highlights" tables.
Key financial highlights for the second quarter:
Loan Portfolio: Loans increased $681.9 million, or 12.1 percent on an annualized basis, to approximately $23.2 billion at June 30, 2018 from March 31, 2018. The increase was largely due to solid organic loan growth within most loan categories. Additionally, we sold approximately $195 million of residential mortgage loans resulting in pre-tax gains of $7.6 million during the second quarter of 2018.
Net Interest Income: Net interest income on a tax equivalent basis of $212.3 million for the second quarter of 2018 increased $3.1 million as compared to the first quarter of 2018 largely due to our new loan volumes and growth through the first six months of 2018.
Provision for Credit Losses: The provision for credit losses declined $3.8 million to $7.1 million for the second quarter of 2018 as compared to the first quarter of 2018. For the second quarter of 2018, the level of the provision was mainly driven by the organic loan growth and a $3.3 million increase in reserves related to impaired taxi medallion loans at June 30, 2018.
Credit Quality: Net loan charge-offs totaled only $692 thousand for the second quarter of 2018 as compared to net recoveries in the three consecutive prior quarters. Net recoveries totaled $612 thousand for the six months ended June 30, 2018. Non-accrual loans represented 0.36 percent of total loans at June 30, 2018.
Net Interest Margin: Our net interest margin on a tax equivalent basis of 3.11 percent for the second quarter of 2018 decreased by 2 basis points from 3.13 percent for the first quarter of 2018. See the "Net Interest Income and Margin" section below for more details.

1



Valley National Bancorp (NYSE: VLY)
2018 Second Quarter Earnings
July 26, 2018



Non-interest Income: Non-interest income increased $5.8 million, or 18.0 percent, to $38.1 million for the second quarter of 2018 as compared to the first quarter of 2018 largely due to increased fee income from derivative interest rate swaps executed with commercial loan customers and higher net gains on sales of loans.
Non-interest Expense: Non-interest expense decreased $23.8 million, or 13.7 percent, to $149.9 million for the second quarter of 2018 as compared to the first quarter of 2018 primarily due to lower merger charges and litigation reserve related expenses.
Performance Ratios: Annualized return on average assets (ROA), shareholders’ equity (ROE) and tangible ROE were 0.98 percent, 8.88 percent and 13.76 percent for the second quarter of 2018, respectively.  Annualized ROA, ROE and tangible ROE, adjusted for infrequent charges, was 1.01 percent, 9.17 percent and 14.21 percent for the second quarter of 2018, respectively.
Efficiency Ratio: Our efficiency ratio was 60.25 percent for the second quarter of 2018 as compared to 72.44 percent and 61.57 percent for the first quarter of 2018 and second quarter of 2017, respectively. Excluding merger expense, amortization of tax credit investments and litigation reserve expense, if applicable, included in non-interest expense, our adjusted efficiency ratio was 57.15 percent for the second quarter of 2018 as compared to 60.23 percent and 57.58 percent for the first quarter of 2018 and second quarter of 2017, respectively. See the "Consolidated Financial Highlights" tables below for additional information regarding this non-GAAP measure.
Income Tax Expense: The effective tax rate was 20.7 percent for the second quarter of 2018 as compared to 23.9 percent for the first quarter of 2018. The decline in the effective tax rate was largely attributable to a $2 million charge included in income tax expense for the first quarter of 2018 related to effect of the USAB acquisition on our state deferred tax assets. For the remainder of 2018, we currently estimate that our effective tax rate will range from 21 percent to 23 percent.
Ira Robbins, CEO and President commented, "We continue to make significant progress towards reshaping the future of Valley. Our many efforts to enhance growth at the Bank are taking hold and we are seeing greater traction in obtaining new clientele and talent alike. We successfully completed the USAB systems conversion during the quarter and fully integrated the USAmeriBank operations into Valley National Bank. I am proud of the incredible amount of progress that Valley and its employees have achieved over the past six months, and I look forward to what the future brings."
Net Interest Income and Margin
Net interest income on a tax equivalent basis totaling $212.3 million for the second quarter of 2018 increased $45.3 million and $3.1 million as compared to the second quarter of 2017 and first quarter of 2018, respectively. The increase as compared to the second quarter of 2017 was largely due to the USAB acquisition effective January 1, 2018. Interest income on a tax equivalent basis increased $12.6 million to $281.6 million for the second quarter of 2018 as compared to the first quarter of 2018 mainly due to a $537.2 million increase in average loans and an 8 basis point increase in the yield on average loans. Interest expense of $69.4 million for the second quarter of 2018 increased $9.5 million as compared to the first quarter of 2018 largely due to higher interest rates on many of our interest bearing deposit products and short-term borrowings, as well as a $679.6 million increase in average short-term borrowings.

Our net interest margin on a tax equivalent basis of 3.11 percent for the second quarter of 2018 decreased by 1 basis point and 2 basis points from 3.12 percent and 3.13 percent for the second quarter of 2017 and first quarter of 2018, respectively. The yield on average interest earning assets increased by 11 basis points on a linked quarter basis mostly due to higher yields on both average loans and taxable investments, as well as one more day during the second quarter of 2018. The yield on average loans increased by 8

2



Valley National Bancorp (NYSE: VLY)
2018 Second Quarter Earnings
July 26, 2018



basis points to 4.34 percent for the second quarter of 2018 as compared to the first quarter of 2018 due to the high volume of new loan originations at current market rates. The yield on average taxable securities increased 28 basis points to 3.02 percent for the second quarter of 2018 as compared to the first quarter of 2018. The overall cost of average interest bearing liabilities increased 16 basis points to 1.38 percent for the second quarter of 2018 as compared to the linked first quarter of 2018 due to 12 and 47 basis point increases in the cost of average interest bearing deposits and short-term borrowings, respectively, largely driven by higher market interest rates. Our cost of total average deposits was 0.76 percent for the second quarter of 2018 as compared to 0.68 percent for the first quarter of 2018.
Branch Transformation
Over the past six months, Valley has embarked on a strategy to overhaul its retail network. The Bank is striving to create a branch infrastructure that is more reflective of current and future activity within our target markets. Our new model is going to place greater emphasis on service, sales, advisory and efficiency. We are in the process of upgrading many staff and training components, as well as placing greater importance on mobile and digital implementation and customer education and encouragement of those products. Valley's branch transformation will also include the repositioning, re-branding, functionality, aesthetics, and in many cases, reducing the square footage of our branches.
With that, we have updated our internal branch profitability and growth requirements, initially analyzing our New Jersey and New York network. We have identified 74 branches out of 177 within NJ and NY that presently do not meet our minimum hurdles for success. Of the 74 identified we expect to consolidate about 20 branches by the end of the first quarter 2019, resulting in an approximate estimated annual operating expense savings of $9 million.
For the remaining 54 branches, we are implementing tailored action plans focused on improving profitability and deposit levels as well as upgrades in staffing and training, within a defined timeline. Should the remaining branches not experience improvement within the associated timeline, they will be reviewed for potential consolidation as well.
While we expect the consolidation process, repositioning and renovations to be mostly complete by the end of 2020, it is important to recognize the evolving retail banking landscape combined with the Bank's renewed expectation regarding profitability will make this activity a more permanent piece of Valley's strategy.
Loans, Deposits and Other Borrowings
Loans. Loans increased $681.9 million to approximately $23.2 billion at June 30, 2018 from March 31, 2018. The increase was mainly due to strong quarter over quarter organic growth in total commercial real estate loans, commercial and industrial loans and residential mortgage loans. During the second quarter of 2018, Valley also originated $219 million of residential mortgage loans for sale rather than held for investment. Residential mortgage loans held for sale totaled $32.7 million and $15.1 million at June 30, 2018 and March 31, 2018, respectively.
Deposits. Total deposits decreased $319.1 million to approximately $21.6 billion at June 30, 2018 from March 31, 2018 largely due to decreases in NOW and money market deposits partially caused by normal fluctuations in municipal and other escrow accounts. Additionally, time deposits decreased $104.4 million due to maturities and strong competition for such deposits in our primary markets. Valley implemented several new deposit gathering campaigns and strategies in the later part of the second quarter of 2018 and July 2018 to better position its deposit offerings for both consumers and businesses. Non-interest

3



Valley National Bancorp (NYSE: VLY)
2018 Second Quarter Earnings
July 26, 2018



bearing deposits; savings, NOW, money market deposits; and time deposits represented approximately 29 percent, 50 percent and 21 percent of total deposits as of June 30, 2018, respectively.
Other Borrowings. Short-term borrowings increased $1.3 billion to approximately $2.9 billion at June 30, 2018 as compared to March 31, 2018 largely due to new FHLB advances used for normal loan funding activity and liquidity purposes during the second quarter of 2018. Long-term borrowings decreased $249.6 million to $2.1 billion at June 30, 2018 as compared to March 31, 2018 mostly due to maturities of FHLB advances and a partial shift in funding to shorter term borrowings.
Credit Quality
Non-Performing Assets. Our past due loans and non-accrual loans discussed further below exclude PCI loans. Under U.S. GAAP, the PCI loans (acquired at a discount that is due, in part, to credit quality) are accounted for on a pool basis and are not subject to delinquency classification in the same manner as loans originated by Valley. Our PCI loan portfolio totaled $4.6 billion, or 20.0 percent, of our total loan portfolio at June 30, 2018 and included all of the loans acquired from USAB on January 1, 2018.
Total non-performing assets (NPAs), consisting of non-accrual loans, other real estate owned (OREO) and other repossessed assets increased $22.1 million to $97.1 million at June 30, 2018 as compared to March 31, 2018 mainly due to an increase of $24.1 million in non-accrual loans, partially offset by a $2.0 million decline in OREO during the second quarter of 2018. The increase in non-accrual loans was primarily related to taxi medallion loans totaling $31.1 million (See further discussion of our taxi medallion lending below). As a result, non-accrual loans increased to 0.36 percent of total loans at June 30, 2018 as compared to 0.27 percent of total loans at March 31, 2018.
Total accruing past due loans (i.e., loans past due 30 days or more and still accruing interest) were $33.3 million, or 0.14 percent of total loans, at June 30, 2018 and remained relatively unchanged as compared to $33.2 million, or 0.15 percent of total loans, at March 31, 2018.
During the second quarter of 2018, we continued to closely monitor our NYC and Chicago taxi medallion loans totaling $125.9 million and $9.0 million, respectively, within the commercial and industrial loan portfolio at June 30, 2018. While the vast majority of the taxi medallion loans are currently performing, negative trends in the market valuations of the underlying taxi medallion collateral could impact the future performance and internal classification of this portfolio. At June 30, 2018, the medallion portfolio included impaired loans totaling $64.7 million with related reserves of $23.2 million within the allowance for loan losses as compared to impaired loans totaling $65.0 million with related reserves of $19.9 million at March 31, 2018. At June 30, 2018, the impaired medallion loans largely consisted of performing troubled debt restructured (TDR) loans classified as substandard loans, as well as $44.7 million of non-accrual taxi cab medallion loans classified as doubtful. Our non-accrual taxi medallion loans increased from $13.9 million at March 31, 2018 primarily due to weakened levels of cash flow, collateral and guarantor support in relation to several previously impaired TDR loans, and not due to actual loan performance.

4



Valley National Bancorp (NYSE: VLY)
2018 Second Quarter Earnings
July 26, 2018



Allowance for Credit Losses. The following table summarizes the allocation of the allowance for credit losses to specific loan categories and the allocation as a percentage of each loan category (including PCI loans) at June 30, 2018, March 31, 2018, and June 30, 2017:
 
 
June 30, 2018
 
March 31, 2018
 
June 30, 2017
 
 
 
 
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 and industrial loans*
$
78,649

 
2.05
%
 
$
70,388

 
1.94
%
 
$
53,792

 
2.04
%
Commercial real estate loans:
 
 
 
 
 
 
 
 
 
 
 
 
Commercial real estate
33,234

 
0.28
%
 
36,109

 
0.31
%
 
37,180

 
0.40
%
 
Construction
20,578

 
1.49
%
 
20,570

 
1.50
%
 
18,275

 
2.07
%
Total commercial real estate loans
53,812

 
0.40
%
 
56,679

 
0.43
%
 
55,455

 
0.55
%
Residential mortgage loans
4,624

 
0.13
%
 
4,100

 
0.12
%
 
4,186

 
0.15
%
Consumer loans:
 
 
 
 
 
 
 
 
 
 
 
 
Home equity
604

 
0.12
%
 
547

 
0.10
%
 
582

 
0.13
%
 
Auto and other consumer
5,465

 
0.26
%
 
4,990

 
0.25
%
 
4,606

 
0.26
%
Total consumer loans
6,069

 
0.23
%
 
5,537

 
0.22
%
 
5,188

 
0.23
%
Total allowance for credit losses
$
143,154

 
0.62
%
 
$
136,704

 
0.61
%
 
$
118,621

 
0.67
%
Allowance for credit losses as a %
 
 
 
 
 
 
 
 
 
 
 
of non-PCI loans
 
 
0.77
%
 
 
 
0.78
%
 
 
 
0.73
%
 
 
 
 
 
 
 
 
 
 
 
 
 
* Includes the reserve for unfunded letters of credit.
 
 
 
 
 
 
 
 
 
 
Our loan portfolio, totaling $23.2 billion at June 30, 2018, had net loan charge-offs totaling $692 thousand for the second quarter of 2018 as compared to net charge-offs of $2.7 million for the second quarter of 2017 and $1.3 million of net recoveries of loan charge-offs during the first quarter of 2018.

During the second quarter of 2018, we recorded a $7.1 million provision for credit losses as compared to $10.9 million and $3.6 million for the first quarter of 2018 and the second quarter of 2017, respectively. The elevated provision during the first half of 2018 was mainly due to higher specific reserves allocated to impaired taxi medallion loans, as well as organic loan growth.

The allowance for credit losses, comprised of our allowance for loan losses and reserve for unfunded letters of credit, as a percentage of total loans was 0.62 percent, 0.61 percent and 0.67 percent at June 30, 2018, March 31, 2018 and June 30, 2017, respectively. At June 30, 2018, our allowance allocations for losses as a percentage of total loans remained relatively unchanged as compared to March 31, 2018 for most loan categories, except for commercial and industrial loans which increased 0.11 percent largely due to higher specific reserves for impaired taxi medallion loans and, to a much lesser extent, internally classified loans.

Our allowance for credit losses as a percentage of total non-PCI loans (excluding PCI loans with carrying values totaling approximately $4.6 billion) was 0.77 percent, 0.78 percent and 0.73 percent at June 30,

5



Valley National Bancorp (NYSE: VLY)
2018 Second Quarter Earnings
July 26, 2018



2018, March 31, 2018 and June 30, 2017, respectively. PCI loans are accounted for on a pool basis and initially recorded net of fair valuation discounts related to credit which may be used to absorb future losses on such loans before any allowance for loan losses is recognized subsequent to acquisition. Due to the adequacy of such discounts, there were no allowance reserves related to PCI loans at June 30, 2018, March 31, 2018 and June 30, 2017.
Capital Adequacy
Valley's regulatory capital ratios continue to reflect its strong capital position. Valley's total risk-based capital, Tier 1 capital, Tier 1 leverage capital, and common equity Tier 1 capital ratios were 11.77 percent, 9.65 percent, 7.72 percent and 8.71 percent, respectively, at June 30, 2018.
Investor Conference Call
Valley will host a conference call with investors and the financial community at 11:00 AM Eastern Standard Time, today to discuss the second quarter 2018 earnings. Those wishing to participate in the call may dial toll-free (800) 230-1059. Investor presentation materials will be made available prior to the conference call at www.valleynationalbank.com.
About Valley
Valley National Bancorp is a regional bank holding company headquartered in Wayne, New Jersey with approximately $30 billion in assets. Its principal subsidiary, Valley National Bank, currently operates over 230 branch locations in northern and central New Jersey, the New York City boroughs of Manhattan, Brooklyn, Queens and Long Island, Florida and Alabama. Valley National Bank is one of the largest commercial banks headquartered in New Jersey and is committed to providing the most convenient service, the latest in product innovations and an experienced and knowledgeable staff with a high priority on friendly customer service. For more information about Valley National Bank and its products and services, please visit www.valleynationalbank.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 management’s confidence and strategies and management’s expectations about 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 “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:
weakness or a decline 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;
the diversion of management's time on any remaining issues related to the USAB merger integration;
the inability to realize expected cost savings and synergies from the merger of USAB with Valley in the amounts or in the timeframe anticipated;

6



Valley National Bancorp (NYSE: VLY)
2018 Second Quarter Earnings
July 26, 2018



the inability to retain USAB’s customers and employees;
less than expected cost reductions and revenue enhancement from Valley's cost reduction plans including its earnings enhancement program called "LIFT";
higher or lower than expected income tax expense or tax rates, including increases or decreases resulting from the impact of the Tax Cuts and Jobs Act and other changes in tax laws, regulations and case law;
damage verdicts or settlements or restrictions related to existing or potential litigations arising from claims of breach of fiduciary responsibility, negligence, fraud, contractual claims, environmental laws, patent or trade mark infringement, employment related claims, and other matters;
the loss of or decrease in lower-cost funding sources within our deposit base may adversely impact our net interest income and net income;
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;
changes in accounting policies or accounting standards, including the new authoritative accounting guidance (known as the current expected credit loss (CECL) model) which may increase the required level of our allowance for credit losses after adoption on January 1, 2020;
our inability or determination not to pay dividends at current levels, or at all, because of inadequate future earnings, regulatory restrictions or limitations, changes in our capital requirements or a decision to increase capital by retaining more earnings;
higher than expected loan losses within one or more segments of our loan portfolio;
unanticipated loan delinquencies, loss of collateral, decreased service revenues, and other potential negative effects on our business caused by severe weather 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 December 31, 2017.
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-

7




VALLEY NATIONAL BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS



SELECTED FINANCIAL DATA
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
March 31,
 
June 30,
 
June 30,
($ in thousands, except for share data)
2018
 
2018
 
2017
 
2018
 
2017
FINANCIAL DATA:
 
 
 
 
 
 
 
 
 
Net interest income
$
210,752

 
$
207,598

 
$
164,820

 
$
418,350

 
$
326,688

Net interest income - FTE (1)
212,252

 
209,120

 
166,946

 
421,372

 
330,987

Non-interest income
38,069

 
32,251

 
28,830

 
70,320

 
54,550

Non-interest expense
149,916

 
173,752

 
119,239

 
323,668

 
240,191

Income tax expense
18,961

 
13,184

 
20,714

 
32,145

 
38,785

Net income
72,802

 
41,965

 
50,065

 
114,767

 
96,160

Dividends on preferred stock
3,172

 
3,172

 
1,797

 
6,344

 
3,594

Net income available to common shareholders
$
69,630

 
$
38,793

 
$
48,268

 
$
108,423

 
$
92,566

Weighted average number of common shares outstanding:
 
 
 
 
 
 
 
 
 
Basic
331,318,381

 
330,727,416

 
263,958,292

 
331,024,531

 
263,878,103

Diluted
332,895,483

 
332,465,527

 
264,778,242

 
332,599,991

 
264,662,863

Per common share data:
 
 
 
 
 
 
 
 
 
Basic earnings
$
0.21

 
$
0.12

 
$
0.18

 
$
0.33

 
$
0.35

Diluted earnings
0.21

 
0.12

 
0.18

 
0.33

 
0.35

Cash dividends declared
0.11

 
0.11

 
0.11

 
0.22

 
0.22

Closing stock price - high
13.26

 
13.38

 
12.23

 
13.38

 
12.76

Closing stock price - low
11.91

 
11.19

 
11.28

 
11.19

 
11.28

CORE ADJUSTED FINANCIAL DATA: (2)
 
 
 
 
 
 
 
 
 
Net income available to common shareholders, as adjusted
$
71,982

 
$
58,549

 
$
48,255

 
$
130,531

 
$
92,567

Basic earnings per share, as adjusted
0.22

 
0.18

 
0.18

 
$
0.39

 
$
0.35

Diluted earnings per share, as adjusted
0.22

 
0.18

 
0.18

 
0.39

 
0.35

FINANCIAL RATIOS:
 
 
 
 
 
 
 
 
 
Net interest margin
3.09
%
 
3.10
%
 
3.08
%
 
3.10
%
 
3.08
%
Net interest margin - FTE (1)
3.11

 
3.13

 
3.12

 
3.12

 
3.12

Annualized return on average assets
0.98

 
0.57

 
0.86

 
0.78

 
0.83

Annualized return on avg. shareholders' equity
8.88

 
5.10

 
8.27

 
6.99

 
7.98

Annualized return on avg. tangible shareholders' equity (2)
13.76

 
7.90

 
11.88

 
10.82

 
11.48

Efficiency ratio (3)
60.25

 
72.44

 
61.57

 
66.23

 
63.00

CORE ADJUSTED FINANCIAL RATIOS: (2)
 
 
 
 
 
 
 
 
 
Annualized return on average assets, as adjusted
1.01
%
 
0.84
%
 
0.86
%
 
0.93
%
 
0.83
%
Annualized return on average shareholders' equity, as adjusted
9.17

 
7.50

 
8.27

 
8.33

 
7.98

Annualized return on average tangible shareholders' equity, as adjusted
14.21

 
11.61

 
11.87

 
12.91

 
11.48

Efficiency ratio, as adjusted
57.15

 
60.23

 
57.58

 
58.66

 
59.58

AVERAGE BALANCE SHEET ITEMS:
 
 
 
 
 
 
 
 
Assets
$
29,778,210

 
$
29,291,703

 
$
23,396,259

 
$
29,536,301

 
$
23,197,377

Interest earning assets
27,256,959

 
26,750,806

 
21,416,747

 
27,005,281

 
21,184,485

Loans
22,840,235

 
22,302,991

 
17,701,676

 
22,573,097

 
17,508,461

Interest bearing liabilities
20,129,492

 
19,690,165

 
15,610,935

 
19,911,043

 
15,448,953

Deposits
21,846,582

 
21,882,034

 
17,288,487

 
21,864,210

 
17,327,411

Shareholders' equity
3,279,616

 
3,289,815

 
2,420,848

 
3,284,687

 
2,410,063



8




VALLEY NATIONAL BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS



 
As Of
BALANCE SHEET ITEMS:
June 30,
 
March 31,
 
December 31,
 
September 30,
 
June 30,
(In thousands)
2018
 
2018
 
2017
 
2017
 
2017
Assets
$
30,182,979

 
$
29,464,357

 
$
24,002,306

 
$
23,780,661

 
$
23,449,350

Total loans
23,234,716

 
22,552,767

 
18,331,580

 
18,201,462

 
17,710,760

Non-PCI loans
18,587,015

 
17,636,934

 
16,944,365

 
16,729,607

 
16,169,291

Deposits
21,640,772

 
21,959,846

 
18,153,462

 
17,312,766

 
17,250,018

Shareholders' equity
3,277,312

 
3,245,003

 
2,533,165

 
2,537,984

 
2,423,901

 
 
 
 
 
 
 
 
 
 
LOANS:
 
 
 
 
 
 
 
 
 
(In thousands)
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
3,829,525

 
$
3,631,597

 
$
2,741,425

 
$
2,706,912

 
$
2,631,312

Commercial real estate:
 
 
 
 
 
 
 
 
 
Commercial real estate
11,913,830

 
11,706,228

 
9,496,777

 
9,351,068

 
9,230,514

Construction
1,376,732

 
1,372,508

 
851,105

 
903,640

 
881,073

 Total commercial real estate
13,290,562

 
13,078,736

 
10,347,882

 
10,254,708

 
10,111,587

Residential mortgage
3,528,682

 
3,321,560

 
2,859,035

 
2,941,435

 
2,724,777

Consumer:
 
 
 
 
 
 
 
 
 
Home equity
520,849

 
549,329

 
446,280

 
448,842

 
450,510

Automobile
1,281,735

 
1,222,721

 
1,208,902

 
1,171,685

 
1,150,343

Other consumer
783,363

 
748,824

 
728,056

 
677,880

 
642,231

Total consumer loans
2,585,947

 
2,520,874

 
2,383,238

 
2,298,407

 
2,243,084

Total loans
$
23,234,716

 
$
22,552,767

 
$
18,331,580

 
$
18,201,462

 
$
17,710,760

 
 
 
 
 
 
 
 
 
 
CAPITAL RATIOS:
 
 
 
 
 
 
 
 
 
Book value per common share
$
9.26

 
$
9.16

 
$
8.79

 
$
8.81

 
$
8.76

Tangible book value per common share (2)
5.75

 
5.65

 
6.01

 
6.04

 
5.98

Tangible common equity to tangible assets (2)
6.56
%
 
6.61
%
 
6.83
%
 
6.92
%
 
6.95
%
Tier 1 leverage capital
7.72

 
7.71

 
8.03

 
8.13

 
7.69

Common equity tier 1 capital
8.71

 
8.77

 
9.22

 
9.22

 
9.18

Tier 1 risk-based capital
9.65

 
9.73

 
10.41

 
10.42

 
9.81

Total risk-based capital
11.77

 
11.89

 
12.61

 
12.61

 
11.99





9




VALLEY NATIONAL BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS



 
Three Months Ended
 
Six Months Ended
ALLOWANCE FOR CREDIT LOSSES:
June 30,
 
March 31,
 
June 30,
 
June 30,
($ in thousands)
2018
 
2018
 
2017
 
2018
 
2017
Beginning balance - Allowance for credit losses
$
136,704

 
$
124,452

 
$
117,696

 
$
124,452

 
$
116,604

Loans charged-off:
 
 
 
 
 
 
 
 
 
Commercial and industrial
(642
)
 
(131
)
 
(2,910
)
 
(773
)
 
(4,624
)
Commercial real estate
(38
)
 
(310
)
 
(139
)
 
(348
)
 
(553
)
Construction

 

 

 

 

Residential mortgage
(99
)
 
(68
)
 
(229
)
 
(167
)
 
(359
)
Total Consumer
(1,422
)
 
(1,211
)
 
(1,011
)
 
(2,633
)
 
(2,132
)
Total loans charged-off
(2,201
)
 
(1,720
)
 
(4,289
)
 
(3,921
)
 
(7,668
)
Charged-off loans recovered:
 
 
 
 
 
 
 
 
 
Commercial and industrial
819

 
2,107

 
312

 
2,926

 
1,160

Commercial real estate
15

 
369

 
346

 
384

 
488

Construction

 

 
294

 

 
294

Residential mortgage
180

 
80

 
235

 
260

 
683

Total Consumer
495

 
468

 
395

 
963

 
958

Total loans recovered
1,509

 
3,024

 
1,582

 
4,533

 
3,583

Net (charge-offs) recoveries
(692
)
 
1,304

 
(2,707
)
 
612

 
(4,085
)
Provision for credit losses
7,142

 
10,948

 
3,632

 
18,090

 
6,102

Ending balance - Allowance for credit losses
$
143,154

 
$
136,704

 
$
118,621

 
$
143,154

 
$
118,621

Components of allowance for credit losses:
 
 
 
 
 
 
 
 
 
Allowance for loan losses
$
138,762

 
$
132,862

 
$
116,446

 
$
138,762

 
$
116,446

Allowance for unfunded letters of credit
4,392

 
3,842

 
2,175

 
4,392

 
2,175

Allowance for credit losses
$
143,154

 
$
136,704

 
$
118,621

 
$
143,154

 
$
118,621

Components of provision for credit losses:
 
 
 
 
 
 
 
 
 
Provision for loan losses
$
6,592

 
$
10,702

 
$
3,710

 
$
17,294

 
$
6,112

Provision for unfunded letters of credit
550

 
246

 
(78
)
 
796

 
(10
)
Provision for credit losses
$
7,142

 
$
10,948

 
$
3,632

 
$
18,090

 
$
6,102

Annualized ratio of total net charge-offs (recoveries) to average loans

0.01
%
 
(0.02
)%
 
0.06
%
 
(0.01
)%
 
0.05
%
Allowance for credit losses as a % of non-PCI loans

0.77
%
 
0.78
%
 
0.73
%
 
0.77
%
 
0.73
%
Allowance for credit losses as a % of total loans

0.62
%
 
0.61
 %
 
0.67
%
 
0.62
 %
 
0.67
%

10




VALLEY NATIONAL BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS



 
As of
ASSET QUALITY: (4)
June 30,
 
March 31,
 
December 31,
 
September 30,
 
June 30,
($ in thousands)
2018
 
2018
 
2017
 
2017
 
2017
Accruing past due loans:
 
 
 
 
 
 
 
 
 
30 to 59 days past due:
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
6,780

 
$
5,405

 
$
3,650

 
$
1,186

 
$
2,391

Commercial real estate
4,323

 
3,699

 
11,223

 
4,755

 
6,983

Construction
175

 
532

 
12,949

 

 

Residential mortgage
7,961

 
6,460

 
12,669

 
7,942

 
4,677

Total Consumer
6,573

 
5,244

 
8,409

 
5,205

 
4,393

Total 30 to 59 days past due
25,812

 
21,340

 
48,900

 
19,088

 
18,444

60 to 89 days past due:
 
 
 
 
 
 
 
 
 
Commercial and industrial
1,533

 
804

 
544

 
3,043

 
2,686

Commercial real estate

 

 

 
626

 
8,233

Construction

 
1,099

 
18,845

 
2,518

 
854

Residential mortgage
1,978

 
4,081

 
7,903

 
1,604

 
1,721

Total Consumer
860

 
1,489

 
1,199

 
1,019

 
1,007

Total 60 to 89 days past due
4,371

 
7,473

 
28,491

 
8,810

 
14,501

90 or more days past due:
 
 
 
 
 
 
 
 
 
Commercial and industrial
560

 
653

 

 
125

 

Commercial real estate
27

 
27

 
27

 
389

 
2,315

Construction

 

 

 

 
2,879

Residential mortgage
2,324

 
3,361

 
2,779

 
1,433

 
3,353

Total Consumer
198

 
372

 
284

 
301

 
275

Total 90 or more days past due
3,109

 
4,413

 
3,090

 
2,248

 
8,822

Total accruing past due loans
$
33,292

 
$
33,226

 
$
80,481

 
$
30,146

 
$
41,767

Non-accrual loans:
 
 
 
 
 
 
 
 
 
Commercial and industrial
$
53,596

 
$
25,112

 
$
20,890

 
$
11,983

 
$
11,072

Commercial real estate
7,452

 
8,679

 
11,328

 
13,870

 
15,514

Construction
1,100

 
732

 
732

 
1,116

 
1,334

Residential mortgage
19,303

 
22,694

 
12,405

 
12,974

 
12,825

Total Consumer
3,003

 
3,104

 
1,870

 
1,844

 
1,409

Total non-accrual loans
84,454

 
60,321

 
47,225

 
41,787

 
42,154

Other real estate owned (OREO)
11,760

 
13,773

 
9,795

 
10,770

 
10,182

Other repossessed assets
864

 
858

 
441

 
480

 
342

Non-accrual debt securities (5)

 

 

 
2,115

 
1,878

Total non-performing assets
$
97,078

 
$
74,952

 
$
57,461

 
$
55,152

 
$
54,556

Performing troubled debt restructured loans
$
111,571

 
$
116,414

 
$
117,176

 
$
113,677

 
$
109,802

Total non-accrual loans as a % of loans
0.36
%
 
0.27
%
 
0.26
%
 
0.23
%
 
0.24
%
Total accruing past due and non-accrual loans as a % of loans
0.51
%
 
0.41
%
 
0.70
%
 
0.40
%
 
0.47
%
Allowance for losses on loans as a % of non-accrual loans
164.30
%
 
220.26
%
 
255.92
%
 
284.70
%
 
276.24
%
Non-performing purchased credit-impaired loans (6)
$
57,311

 
$
62,857

 
$
38,088

 
$
25,413

 
$
33,715




11




VALLEY NATIONAL BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS



NOTES TO SELECTED FINANCIAL DATA
(1)
Net interest income and net interest margin are presented on a tax equivalent basis using a 21 percent and 35 percent federal tax rate for periods ending in 2018 and 2017, respectively. Valley believes 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.
(2)
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 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
 
Six Months Ended
 
June 30,
 
March 31,
 
June, 30
 
June 30,
($ in thousands, except for share data)
2018
 
2018
 
2017
 
2018
 
2017
Adjusted net income available to common shareholders:
 
 
 
 
 
 
 
 
 
Net income, as reported
$
72,802

 
$
41,965

 
$
50,065

 
$
114,767

 
$
96,160

Add: Losses (gains) on securities transactions (net of tax)
26

 
548

 
(13
)
 
574

 
1

Add: Legal expenses (litigation reserve impact only, net of tax)

 
7,520

 

 
7,520

 

Add: Merger related expenses (net of tax)*
2,326

 
9,688

 

 
12,014

 

Add: Income Tax Expense (USAB charge impact only)

 
2,000

 

 
2,000

 

Net income, as adjusted
$
75,154

 
$
61,721

 
$
50,052

 
$
136,875

 
$
96,161

Dividends on preferred stock
3,172

 
3,172

1,797

1,797

 
6,344

 
3,594

Net income available to common shareholders, as adjusted
$
71,982

 
$
58,549

 
$
48,255

 
$
130,531

 
$
92,567

 
 
 
 
 
 
 
 
 
 
* Merger related expenses are primarily within salary and employee benefits and other expense.
Adjusted per common share data:
 
 
 
 
 
 
 
 
 
Net income available to common shareholders, as adjusted
$
71,982

 
$
58,549

 
$
48,255

 
$
130,531

 
$
92,567

Average number of shares outstanding
331,318,381

 
330,727,416

 
263,958,292

 
331,024,531

 
263,878,103

Basic earnings, as adjusted
$
0.22

 
$
0.18

 
$
0.18

 
$
0.39

 
$
0.35

Average number of diluted shares outstanding
332,895,483

 
332,465,527

 
264,778,242

 
332,599,991

 
264,662,863

Diluted earnings, as adjusted
$
0.22

 
$
0.18

 
$
0.18

 
$
0.39

 
$
0.35

Adjusted annualized return on average tangible shareholders' equity:
 
 
 
 
 
 
 
 
 
Net income, as adjusted
$
75,154

 
$
61,721

 
$
50,052

 
$
136,875

 
$
96,161

Average shareholders' equity
3,279,616

 
3,289,815

 
2,420,848

 
3,284,687

 
2,410,063

Less: Average goodwill and other intangible assets
(1,163,575
)
 
(1,164,230
)
 
(734,616
)
 
(1,163,901
)
 
(735,393
)
Average tangible shareholders' equity
$
2,116,041

 
$
2,125,585

 
$
1,686,232

 
$
2,120,786

 
$
1,674,670

Annualized return on average tangible shareholders' equity, as adjusted

14.21
%
 
11.61
%
 
11.87
%
 
12.91
%
 
11.48
%
Adjusted annualized return on average assets:
 
 
 
 
 
 
 
 
 
Net income, as adjusted
$
75,154

 
$
61,721

 
$
50,052

 
$
136,875

 
$
96,161

Average assets
$
29,778,210

 
$
29,291,703

 
$
23,396,259

 
$
29,536,301

 
$
23,197,377

Annualized return on average assets, as adjusted
1.01
%
 
0.84
%
 
0.86
%
 
0.93
%
 
0.83
%
Adjusted annualized return on average shareholders' equity:
 
 
 
 
 
 
 
 
 
Net income, as adjusted
$
75,154

 
$
61,721

 
$
50,052

 
$
136,875

 
$
96,161

Average shareholders' equity
$
3,279,616

 
$
3,289,815

 
$
2,420,848

 
$
3,284,687

 
$
2,410,063

Annualized return on average shareholders' equity, as adjusted
9.17
%
 
7.50
%
 
8.27
%
 
8.33
%
 
7.98
%


12




VALLEY NATIONAL BANCORP
CONSOLIDATED FINANCIAL HIGHLIGHTS



 
Three Months Ended
 
Six Months Ended
 
June 30,
 
March 31,
 
June 30,
 
June 30,
($ in thousands)
2018
 
2018
 
2017
 
2018
 
2017
Annualized return on average tangible shareholders' equity:
 
 
 
 
 
 
 
 
 
Net income, as reported
$
72,802

 
$
41,965

 
$
50,065

 
$
114,767

 
$
96,160

Average shareholders' equity
3,279,616

 
3,289,815

 
2,420,848

 
3,284,687

 
2,410,063

Less: Average goodwill and other intangible assets
(1,163,575
)
 
(1,164,230
)
 
(734,616
)
 
(1,163,901
)
 
(735,393
)
Average tangible shareholders' equity
$
2,116,041

 
$
2,125,585

 
$
1,686,232

 
$
2,120,786

 
$
1,674,670

Annualized return on average tangible shareholders' equity
13.76
%
 
7.90
%
 
11.88
%
 
10.82
%
 
11.48
%
Adjusted efficiency ratio:
 
 
 
 
 
 
 
 
 
Non-interest expense
$
149,916

 
$
173,752

 
$
119,239

 
$
323,668

 
$
240,191

Less: Legal expenses (litigation reserve impact only, pre-tax)

 
(10,500
)
 

 
(10,500
)
 

Less: Merger-related expenses (pre-tax)
(3,248
)
 
(13,528
)
 

 
(16,776
)
 

Less: Amortization of tax credit investments (pre-tax)
(4,470
)
 
(5,274
)
 
(7,732
)
 
(9,744
)
 
(13,056
)
Non-interest expense, as adjusted
$
142,198

 
$
144,450

 
$
111,507

 
$
286,648

 
$
227,135

Net interest income
210,752

 
207,598

 
164,820

 
418,350

 
326,688

Non-interest income
38,069

 
32,251

 
28,830

 
70,320

 
54,550

Gross operating income
$
248,821

 
$
239,849

 
$
193,650

 
488,670

 
381,238

Efficiency ratio, as adjusted
57.15
%
 
60.23
%
 
57.58
%
 
58.66
%
 
59.58
%

 
As of
 
June 30,
 
March 31,
 
December 31,
 
September 30,
 
June 30,
($ in thousands, except for share data)
2018
 
2018
 
2017
 
2017
 
2017
Tangible book value per common share:
 
 
 
 
 
 
 
 
 
Common shares outstanding
331,454,025

 
331,189,859

 
264,468,851

 
264,197,172

 
263,971,766

Shareholders' equity
$
3,277,312

 
$
3,245,003

 
$
2,533,165

 
$
2,537,984

 
$
2,423,901

Less: Preferred stock
(209,691
)
 
(209,691
)
 
(209,691
)
 
(209,691
)
 
(111,590
)
Less: Goodwill and other intangible assets
(1,162,858
)
 
(1,165,379
)
 
(733,144
)
 
(733,498
)
 
(734,337
)
Tangible common shareholders' equity
$
1,904,763

 
$
1,869,933

 
$
1,590,330

 
$
1,594,795

 
$
1,577,974

Tangible book value per common share
$
5.75

 
$
5.65

 
$
6.01

 
$
6.04

 
$
5.98

Tangible common equity to tangible assets:
 
 
 
 
 
 
 
 
Tangible common shareholders' equity
$
1,904,763

 
$
1,869,933

 
$
1,590,330

 
$
1,594,795

 
$
1,577,974

Total assets
30,182,979

 
29,464,357

 
24,002,306

 
23,780,661

 
23,449,350

Less: Goodwill and other intangible assets
(1,162,858
)
 
(1,165,379
)
 
(733,144
)
 
(733,498
)
 
(734,337
)
Tangible assets
$
29,020,121

 
$
28,298,978

 
$
23,269,162

 
$
23,047,163

 
$
22,715,013

Tangible common equity to tangible assets
6.56
%
 
6.61
%
 
6.83
%
 
6.92
%
 
6.95
%
(3)
The efficiency ratio measures Valley's total non-interest expense as a percentage of net interest income plus total non-interest income.
(4)
Past due loans and non-accrual loans exclude purchased credit-impaired (PCI) loans. PCI loans are accounted for on a pool basis under U.S. GAAP and are not subject to delinquency classification in the same manner as loans originated by Valley.
(5)
Includes other-than-temporarily impaired trust preferred securities classified as available for sale, which are presented at carrying value (net of unrealized losses totaling $637 thousand and $875 thousand at September 30, 2017 and June 30, 2017, respectively) after recognition of all credit impairments. There were no non-accrual debt securities at June 30, 2018, March 31, 2018 and December 31, 2017.
(6)
Represent PCI loans meeting Valley's definition of non-performing loan (i.e., non-accrual loans), but are not subject to such classification under U.S. GAAP because the loans are accounted for on a pooled basis and are excluded from the non-accrual loans in the table above.
SHAREHOLDERS RELATIONS
Requests for copies of reports and/or other inquiries should be directed to Tina Zarkadas, Assistant Vice President, Shareholder Relations Specialist, Valley National Bancorp, 1455 Valley Road, Wayne, New Jersey, 07470, by telephone at (973) 305-3380, by fax at (973) 305-1364 or by e-mail at tzarkadas@valleynationalbank.com.


13




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


 
June 30,
 
December 31,
 
2018
 
2017
 
 (Unaudited)
 
 
Assets
 
 
 
Cash and due from banks
$
307,428

 
$
243,310

Interest bearing deposits with banks
164,838

 
172,800

Investment securities:
 
 
 
Held to maturity (fair value of $1,988,782 at June 30, 2018 and $1,837,620 at December 31, 2017)
2,030,194

 
1,842,691

Available for sale
1,833,467

 
1,493,905

Total investment securities
3,863,661

 
3,336,596

Loans held for sale, at fair value
32,670

 
15,119

Loans
23,234,716

 
18,331,580

Less: Allowance for loan losses
(138,762
)
 
(120,856
)
Net loans
23,095,954

 
18,210,724

Premises and equipment, net
348,396

 
287,705

Bank owned life insurance
437,037

 
386,079

Accrued interest receivable
88,155

 
73,990

Goodwill
1,078,892

 
690,637

Other intangible assets, net
83,966

 
42,507

Other assets
681,982

 
542,839

Total Assets
$
30,182,979

 
$
24,002,306

Liabilities
 
 
 
Deposits:
 
 
 
Non-interest bearing
$
6,217,420

 
$
5,224,928

Interest bearing:
 
 
 
Savings, NOW and money market
10,769,940

 
9,365,013

Time
4,653,412

 
3,563,521

Total deposits
21,640,772

 
18,153,462

Short-term borrowings
2,877,912

 
748,628

Long-term borrowings
2,103,993

 
2,315,819

Junior subordinated debentures issued to capital trusts
55,196

 
41,774

Accrued expenses and other liabilities
227,794

 
209,458

Total Liabilities
26,905,667

 
21,469,141

Shareholders’ Equity
 
 
 
Preferred stock, no par value; authorized 50,000,000:
 
 
 
Series A (4,600,000 shares issued at June 30, 2018 and December 31, 2017)
111,590

 
111,590

Series B (4,000,000 shares issued at June 30, 2018 and December 31, 2017)
98,101

 
98,101

Common stock (no par value, authorized 450,000,000 shares; issued 331,538,971 shares at June 30, 2018 and 264,498,643 shares at December 31, 2017)
116,027

 
92,727

Surplus
2,789,190

 
2,060,356

Retained earnings
232,593

 
216,733

Accumulated other comprehensive loss
(69,124
)
 
(46,005
)
Treasury stock, at cost (84,946 common shares at June 30, 2018 and 29,792 common shares at December 31, 2017)
(1,065
)
 
(337
)
Total Shareholders’ Equity
3,277,312

 
2,533,165

Total Liabilities and Shareholders’ Equity
$
30,182,979

 
$
24,002,306


14




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


 
Three Months Ended
 
Six Months Ended
 
June 30,
 
March 31,
 
June 30,
 
June 30,
 
2018
 
2018
 
2017
 
2018
 
2017
Interest Income
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
247,690

 
$
237,586

 
$
181,720

 
$
485,276

 
$
356,073

Interest and dividends on investment securities:
 
 
 
 
 
 
 
 
 
Taxable
22,222

 
21,323

 
18,928

 
43,545

 
36,517

Tax-exempt
5,639

 
5,721

 
3,943

 
11,360

 
7,974

Dividends
3,728

 
1,939

 
2,137

 
5,667

 
4,288

Interest on federal funds sold and other short-term investments
839

 
926

 
279

 
1,765

 
610

Total interest income
280,118

 
267,495

 
207,007

 
547,613

 
405,462

Interest Expense
 
 
 
 
 
 
 
 
 
Interest on deposits:
 
 
 
 
 
 
 
 
 
Savings, NOW and money market
24,756

 
22,317

 
12,714

 
47,073

 
22,897

Time
16,635

 
14,616

 
10,166

 
31,251

 
19,719

Interest on short-term borrowings
10,913

 
5,732

 
5,516

 
16,645

 
9,417

Interest on long-term borrowings and junior subordinated debentures
17,062

 
17,232

 
13,791

 
34,294

 
26,741

Total interest expense
69,366

 
59,897

 
42,187

 
129,263

 
78,774

Net Interest Income
210,752

 
207,598

 
164,820

 
418,350

 
326,688

Provision for credit losses
7,142

 
10,948