NASDAQ$VLY

Valley National Bancorp · Q4 2021 earnings

Q4 2021 earnings · · Investor relations

Briefing

Reported increased net income, strong organic loan growth, and net interest margin for the fourth quarter of 2021.

Valley National Bancorp reported a strong fourth quarter in 2021, with net income increasing to $115.0 million, or $0.27 per diluted common share. The company experienced strong organic loan growth and an increase in net interest margin. The acquisition of The Westchester Bank Holding Corp. was completed during the quarter, contributing to the overall performance.

  • Net income for Q4 2021 was $115.0 million, or $0.27 per diluted common share.
  • Total loans increased by $1.5 billion to $34.2 billion, driven by the acquisition of Westchester Bank and organic loan growth.
  • Net interest income on a tax equivalent basis increased to $316.0 million, with a net interest margin of 3.23 percent.
  • The acquisition of The Westchester Bank Holding Corp. was completed on December 1, 2021, adding approximately $1.4 billion in assets.

Headline financials

Total Revenue

$354M

Previous: $335M+5.4%
EPS (adj)

$0.28

Previous: $0.27+3.7%
Efficiency ratio

52.2%

Previous: 51.6%+1.1%
Annualized return on avg. tangible common shareholders' equity

13.4%

No prior period
Capital Expenditures

$19.6M

Previous: $3.89M+404.2%
Free Cash Flow

$234M

Previous: $167M+40.3%
Net Income

$115M

Previous: $105M+9.2%
Operating Income

$157M

Previous: $143M+9.7%
Cash & Equivalents

$2.05B

Previous: $1.33B+54.2%
Total Assets

$43.4B

Previous: $40.7B+6.8%
Stock-Based Comp

$5.04M

Previous: $4.15M+21.2%

Revenue & EPS history

Valley National · Revenue · Quarterly

$354M

Q4 2021+5.4%vs Q4 2020
Beat estimate in 11 of 16 quarters(69%)
ActualEstimate

Revenue by segment

Valley National · $45.2B total across 4 segments · Q3 2022

  • Total commercial real estate
    $28.1B
  • Commercial and industrial loans
    $8.7B+2709.1%
  • Residential mortgage
    $5.18B
  • Total consumer loans
    $3.24B

Forward guidance

Valley National Bancorp's CEO, Ira Robbins, expressed excitement about the growth opportunities for Valley, highlighting the value-enhancing bank partnerships and investments in fee income capabilities. The company remains well-positioned for success in the evolving banking landscape.

Tailwinds

  • Strong fourth quarter 2021 core results demonstrate the significant earnings power.
  • Generated net income of approximately $474 million in 2021, a 21 percent increase from the prior year.
  • Continuing to build out low-cost funding channels in support of strong and diverse organic loan production.
  • Completed the Westchester acquisition and welcomed their customers and knowledgeable staff to Valley.
  • Identified a pair of value-enhancing bank partners which we believe will accelerate our future organic growth capabilities and further diversify our business offerings.

Headwinds

  • The inability to realize expected cost savings and synergies from the Westchester and Bank Leumi USA (Bank Leumi) acquisitions in amounts or in the timeframe anticipated.
  • Costs or difficulties relating to Westchester and Bank Leumi integration matters might be greater than expected.
  • The inability to retain customers and qualified employees of Westchester and Bank Leumi.
  • Changes in estimates of non-recurring charges related to the Westchester and Bank Leumi acquisitions.
  • The continued impact of COVID-19 on the U.S. and global economies, including business disruptions, reductions in employment and an increase in business failures, specifically among our clients.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2021

Historical avgQ4 2021

-0.2%

Avg return

Earnings day

+0.2%

Avg return

5 days after

+1.6%

Avg return

30 days after

50%

34 / 68 earnings

Positive

+9.3%

Q1 2023

Best reaction

-8.3%

Q1 2013

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+3.9%+2.8%+2.2%
Q4 2025+3.0%+7.1%+2.8%
Q3 2025+4.3%+10.5%+6.3%
Q1 2025+1.2%+0.5%+0.8%
Q4 2024-0.2%+4.1%-2.7%
Q3 2024+1.6%+5.0%+15.8%
Q2 2024+5.1%+4.7%+13.5%
Q1 2024-6.6%-10.6%-6.1%
Q4 2023-4.3%-3.4%-21.9%
Q3 2023+0.1%+0.4%+13.2%
Q2 2023-1.4%-3.8%-15.0%
Q1 2023+9.3%-14.9%-11.0%
Q4 2022+3.0%+7.0%+5.5%
Q3 2022+3.0%+2.8%+8.4%
Q2 2022+4.1%+4.1%+8.0%
Q1 2022-2.0%-1.8%+4.5%
Q4 2021-5.7%-4.3%-3.4%
Q3 2021-1.2%+3.9%+3.6%
Q2 2021-0.9%-1.4%+1.1%
Q1 2021-1.6%+2.1%+2.4%
Q4 2020-1.7%+0.8%+17.9%
Q3 2020+5.8%-1.0%+20.4%
Q2 2020+3.5%-0.8%-0.4%
Q1 2020-4.6%-8.0%-3.9%
Q4 2019-3.4%+0.0%-14.7%
Q3 2019+0.3%+2.9%+2.1%
Q2 2019+1.2%+1.8%-7.8%
Q1 2019+0.3%+1.3%-1.5%
Q4 2018-2.5%-1.1%+2.0%
Q3 2018+0.3%+5.1%+4.8%
Q2 2018-6.1%-7.8%-5.1%
Q1 2018+3.2%+1.7%+3.9%
Q4 2017+4.7%+2.9%+5.8%
Q3 2017-2.4%-3.7%-5.4%
Q2 2017-5.9%-4.2%-9.1%
Q1 2017+0.4%-0.7%-5.0%
Q4 2016+6.8%+5.7%+9.0%
Q3 2016+1.4%+0.9%+16.7%
Q2 2016-0.8%-1.0%+4.6%
Q1 2016-6.7%
Q4 2015+0.7%
Q3 2015+5.8%
Q2 2015-1.8%
Q1 2015-2.0%
Q4 2014-1.2%
Q3 2014-0.3%
Q2 2014-0.6%
Q1 2014-6.9%
Q4 2013-1.8%
Q3 2013-4.1%
Q2 2013+3.8%
Q1 2013-8.3%
Q4 2012-0.2%
Q3 2012-0.4%
Q2 2012-0.3%
Q1 2012+0.1%
Q4 2011+0.5%
Q4 2008+0.5%
Q3 2011+3.8%
Q2 2011-2.7%
Q1 2010+0.4%
Q1 2011+0.3%
Q4 2010-1.6%
Q3 2010-2.9%
Q3 2009-2.9%
Q4 2009+0.1%
Q2 2010+0.1%
Q2 2009+0.1%

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