Valley National Bancorp (VLY) Business Profile

What it does

Valley National Bancorp is a bank holding company headquartered in Morristown, New Jersey. Founded in 1927, it operates principally through Valley National Bank, using the names Valley Bank and Valley. Ira Robbins is its chairman and chief executive officer.

Valley serves businesses and individuals with deposits, loans and other financial services. Its commercial products include business loans, commercial real estate financing, equipment financing and loans to small businesses. For individuals, it offers mortgages, home equity loans and automobile financing. Customers can also use insurance, investment advice, brokerage, trust and private banking services.

The bank serves customers through branches, ATMs, telephone banking and online and mobile banking. Its branch offices are in New Jersey, New York, Florida, Alabama, California and Illinois. Valley also offers certain specialized services nationally, including banking for homeowners associations, cannabis-related businesses and venture banking clients.

Valley organizes its operations into Commercial Banking and Consumer Banking. The latter includes its wealth management and insurance division. Treasury and Corporate Other holds activities not assigned to those operating segments, including securities used for liquidity management.

At December 31, 2025, Valley had consolidated total assets of $64.1 billion, total net loans of $49.6 billion and total deposits of $52.2 billion. It had 3,675 employees in FY2025.

How it makes money

Valley earns interest from loans and securities and pays interest on deposits and borrowings. The difference between interest earned and interest paid is net interest income. Its results depend on both the balances and rates of those assets and funding sources. In 2025, net interest income increased as rates on most interest-bearing deposit products fell, high-cost indirect deposits declined and investment securities added interest income, partly offset by lower yields on adjustable-rate loans.

Commercial Banking lends to businesses and finances commercial real estate. Commercial and industrial products include equipment loans and working-capital lines of credit, while real estate lending includes loans on properties and construction projects. Many commercial real estate loans have adjustable rates tied to a market index; their adjustment periods generally range between five to ten years. Valley also earns fees from services tied to business customers, including treasury management, loan syndications and interest rate swaps.

Consumer Banking includes residential mortgages, automobile loans, home equity lending and other consumer loans. It also includes wealth management and insurance services, such as investment advice, brokerage, trusts, insurance and tax credit advisory. Valley receives compensation for servicing certain mortgage portfolios, primarily loans it originated and sold.

In the second quarter of 2026, net interest income on a tax equivalent basis increased to $488 million, while noninterest income increased to $73.7 million. Valley attributed the rise in noninterest income partly to capital markets revenue and wealth management and trust fees.

Net income was $598.0 million for the year ended December 31, 2025, and approximately $171 million for the second quarter of 2026.

Customers and how it sells

Valley lends to small and middle-market businesses, primarily in New Jersey, New York and Florida, and selectively lends nationwide in specialty businesses. Those specialties include healthcare, capital call lines of credit and equipment leasing. Its clients also include businesses in real estate, commercial and industrial activities, nonprofit organizations and government contracting.

Consumer customers use mortgages, automobile loans, home equity products, deposits and wealth services. Automobile loans are largely originated through approved dealers, while personal lines secured by life insurance cash value are mainly originated through branches and third-party financial advisors. Valley also provides investment and trust services to individuals and businesses.

At December 31, 2025, Valley had 230 branch offices. Of the branch network, 55 percent, 18 percent, and 18 percent were in New Jersey, New York and Florida, respectively; the remaining 9 percent were in Alabama, California and Illinois combined. Customers also have access to ATMs and telephone, online and digital banking.

The loan portfolio is concentrated in several states. At December 31, 2025, loans were concentrated in New York, Florida and New Jersey. Valley also offers homeowners association, cannabis-related business and venture banking products nationally.

Suppliers and costs

Deposits are a source of funding for Valley’s lending and investments. The bank pays interest on interest-bearing deposits and also uses borrowings and brokered deposits. At December 31, 2025, total deposits were $52.2 billion; indirect customer deposits, including brokered money market and time deposits, were $5.4 billion.

In the second quarter of 2026, Valley used $200 million of incremental brokered deposits to fund what it described as a temporary timing mismatch with loan growth. It expects to continue reducing brokered deposits, although it also uses them to manage interest-rate risk.

Operating costs include salaries and employee benefits, technology, professional services, regulatory compliance and deposit insurance assessments. In 2025, non-interest expense increased partly because of additional tax credit investments and targeted hiring, offset in part by lower FDIC assessment and technology-related expenses. Reported noninterest expense was $311 million in the second quarter of 2026; Valley identified FDIC expense and third-party spending on operational transformation among the quarter’s cost increases.

Valley uses external technology partners to enhance online and mobile banking, retains outside regulatory advisors and uses third-party financial advisors for certain consumer lending. It also employs specialists for compliance.

Competitive position

Valley competes for deposits, loans and other financial services with commercial and savings banks, credit unions, mortgage companies, fintech companies, asset managers, insurers and other providers. Competition spans local, regional and national institutions. Some competitors are larger, have more financial resources or lending capacity, or operate under fewer regulatory constraints.

In the New York, Northern New Jersey and Long Island deposit markets, Valley ranked 10th among 150 FDIC-insured financial institutions based on deposits as of June 30, 2025. In the same market, it ranked 1st among financial institutions below $1 trillion in assets. Valley also ranked 6th in New Jersey by deposit market share on that date.

Valley seeks customers through relationship banking, a range of products and a branch, ATM and digital network. It uses technology partners to improve online and mobile services as fintech and direct-bank providers compete for retail customers. The company said deposit competition was intensifying in the second quarter of 2026, particularly on the consumer side.

Our reading: Valley’s regional deposit presence and relationships give it a base from which to compete, but the breadth of competing providers limits the protection those relationships offer. Its digital and service capabilities support that position, although competitors also invest in technology and some face fewer regulatory constraints.

No individual competitor is named as such in the supplied company disclosures.

Growth opportunities

Valley is seeking to deepen commercial relationships by combining business lending with deposits, treasury management and other services. It has focused loan growth on commercial and industrial lending and owner-occupied commercial real estate while reducing new originations of certain non-owner occupied and multifamily loans. It has also invested in commercial banking personnel and its treasury platform.

In the second quarter of 2026, direct customer deposits increased $1.1 billion and loans increased $1.6 billion. Valley said commercial and industrial growth included contributions from New York, Florida, Chicago, healthcare and fund finance. It expects gross loan growth for 2026 at or somewhat above the high end of its 4% to 6% range.

Fee-based services are another part of the strategy. Valley is expanding treasury management, capital markets and tax credit advisory capabilities, alongside wealth management and insurance. It expects 2026 fee income growth toward the higher end of its previously announced 6% to 9% range.

The company is also using technology and artificial intelligence in its operations. Its stated objectives include supporting productivity, risk management and customer experience. Valley said it had $15 million of saves in the expense run rate against about $3 million or $4 million of new AI-associated expenses. It expects its efficiency ratio to be 50% or lower as it exits 2026.

Structural risks

• Commercial real estate credit: Commercial real estate and construction loans represented 58.3 percent of total loans at December 31, 2025. Real estate market weakness could impair asset quality, increase defaults and losses, and affect profitability. Repayment of most such loans depends on cash flow from the property or occupying business.
• Geographic and economic exposure: Lending is concentrated in New York, Florida and New Jersey. Changing economic conditions and local real estate markets can affect borrowers’ ability to repay and the value of collateral.
• Interest rates and funding: Changes in interest rates can reduce net interest income and earnings. Assets and liabilities may reprice at different times or by different amounts; Valley also faces liquidity risk if it cannot fund obligations to borrowers, depositors or other creditors at a reasonable cost.
• Credit losses: The allowance for credit losses depends on estimates of future borrower performance, economic conditions and collateral values. Actual losses may differ from those estimates. Net charge-offs totaled $22 million in the second quarter of 2026, compared with $18 million in the first quarter.
• Technology and regulation: Cybersecurity incidents or disruptions at Valley or its service providers could cause losses, liability and operating disruption. Banking regulation adds compliance costs and can limit activities; commercial real estate concentrations receive heightened regulatory scrutiny.

Bottom line

Our reading

Valley is a regional banking business built around lending, deposits and customer relationships, with fee services adding another source of income. Its effort to grow business lending and direct deposits is changing the mix, but commercial real estate remains a large part of its loan book. The business therefore depends on both funding costs and borrowers’ ability to repay, particularly through changes in regional real estate and economic conditions.