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Sep 30, 2021
Valley National Q3 2021 Earnings Report
Valley National's Q3 2021 net income increased by 20 percent, driven by solid net interest margin and non-PPP loan growth.
Key Takeaways
Valley National Bancorp reported a strong third quarter with a 20% increase in net income compared to the same period last year. The company's net interest margin remained solid, and non-PPP loan growth contributed to the positive results. The pending acquisitions of Bank Leumi and The Westchester Bank Holding Corporation, along with the recent acquisition of Dudley Ventures, are expected to further enhance Valley's capabilities and market reach.
Net income for the third quarter 2021 was $122.6 million, or $0.29 per diluted common share, compared to $102.4 million, or $0.25 per diluted common share, for the third quarter 2020.
Non-PPP loan portfolio increased $626.0 million, or 8.0 percent on an annualized basis.
Net interest income on a tax equivalent basis was $301.7 million, an increase of $17.6 million from the third quarter 2020.
The company announced acquisitions of Bank Leumi Le-Israel Corporation and Dudley Ventures to expand commercial banking and tax credit investment businesses.
Revenue by Segment
Forward Guidance
Valley National Bancorp is strategically positioned for future growth and enhanced performance. The company's forward guidance reflects optimism based on several positive factors and awareness of potential challenges.
Positive Outlook
- Pending acquisitions of Bank Leumi and The Westchester Bank Holding Corporation will expand capabilities, cross-sell services, and broaden market reach.
- Recent acquisition of Dudley Ventures will enhance tax credit investment business and community impact.
- Continued strength and quality of the balance sheet.
- Disciplined loan pricing and effective management of net interest margin in a challenging market rate environment.
- Linked quarter non-PPP loan growth of 8 percent, well-diversified in the third quarter.
Challenges Ahead
- Failure to obtain shareholder or regulatory approval for the acquisitions of Westchester and Bank Leumi.
- Inability to realize expected cost savings and synergies from the Westchester and Bank Leumi acquisitions.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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