Attached files
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| 8-K - FORM 8-K - VALLEY NATIONAL BANCORP | d8k.htm |
 Investor
Presentation EXHIBIT 99.1 |
 2
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,
relationships, opportunities, taxation, technology and market conditions. These
statements may be identified by such forward-looking terminology as
“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 from those
contemplated by such forward-looking statements include, but are not limited to,
the following: failure to obtain shareholder or regulatory approval for the merger of
State Bancorp with Valley or to satisfy other conditions to the merger on the proposed
terms and within the proposed timeframe including, without limitation, the purchase from the
United States Department of the Treasury of each share of State Bancorp’s Series A
Preferred Stock issued under the Treasury’s Capital Purchase Program; the
inability to realize expected cost savings and synergies from the merger of State
Bancorp with Valley in the amounts or in the timeframe anticipated; changes in the
estimate of non-recurring charges; costs or difficulties relating to integration matters
might be greater than expected; material adverse changes in Valley’s or State
Bancorp’s operations or earnings; the inability to retain State Bancorp’s
customers and employees; or a decline in the economy in Valley’s primary market areas,
mainly in New Jersey and New York, as well as the risk factors set forth in Valley’s
Annual Report on Form 10-K for the year ended December 31, 2010. Valley
assumes no obligation for updating any such forward-looking statement at any time. |
 3
Additional Information and Where to Find it
This communication does not constitute an offer to
sell or the solicitation of an offer to buy any securities or a solicitation of any
vote or approval. In connection with the proposed merger, Valley intends to file a proxy
statement/prospectus with the Securities and Exchange Commission. INVESTORS AND SECURITY
HOLDERS ARE ADVISED TO READ THE PROXY STATEMENT/PROSPECTUS WHEN IT BECOMES AVAILABLE,
BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION. Investors and security holders may
obtain a free copy of the registration statement (when available) and other documents
filed by Valley with the Commission at the Commission’s web site at
www.sec.gov. These documents may be accessed and downloaded for free at Valley’s web site at
http://www.valleynationalbank.com/filings.html or by directing a request to Dianne M. Grenz,
First Senior Vice President, Valley National Bancorp, at 1455 Valley Road, Wayne, New
Jersey 07470, telephone (973) 305-3380. Participants in the Solicitation
This communication is not a solicitation of a proxy
from any security holder of State Bancorp. However, Valley, State Bancorp, their
respective directors and executive officers and other persons may be deemed to be
participants in the solicitation of proxies from State Bancorp’s shareholders in respect
of the proposed transaction. Information regarding the directors and executive
officers of Valley may be found in its definitive proxy statement relating to its 2011
Annual Meeting of Shareholders, which was filed with the Commission on March 11, 2011
and can be obtained free of charge from Valley’s website. Information regarding the directors
and executive officers of State Bancorp may be found in its definitive proxy statement
relating to its 2011 Annual Meeting of Shareholders, which was filed with the
Commission on March 25, 2011 and can be obtained free of charge from State
Bancorp’s website. Other information regarding the participants in the proxy solicitation and a
description of their direct and indirect interests, by security holdings or otherwise, will be
contained in the proxy statement/prospectus and other relevant materials to be filed
with the SEC when they become available. |
 Historical
Financial Data (1) (Dollars in millions, except for share data)
3/31/2011
14,364
$
36.6
$
$0.22
1.03
%
11.23
%
$0.17
5/11 -
5%
Stock Dividend
2010
14,144
131.2
0.78
0.93
10.32
0.69
5/10 -
5%
Stock Dividend
2009
14,284
116.1
0.61
0.81
8.64
0.69
5/09 -
5%
Stock Dividend
2008
14,718
93.6
0.61
0.69
8.74
0.69
5/08 -
5%
Stock Dividend
2007
12,749
153.2
1.05
1.25
16.43
0.69
5/07 -
5%
Stock Dividend
2006
12,395
163.7
1.10
1.33
17.24
0.67
5/06 -
5%
Stock Dividend
2005
12,436
163.4
1.12
1.39
19.17
0.65
5/05 -
5%
Stock Dividend
2004
10,763
154.4
1.11
1.51
22.77
0.63
5/04 -
5%
Stock Dividend
2003
9,873
153.4
1.10
1.63
24.21
0.60
5/03 -
5%
Stock Dividend
2002
9,148
154.6
1.06
1.78
23.59
0.57
5/02 -
5:4
Stock Split
2001
8,590
135.2
0.89
1.68
19.70
0.54
5/01 -
5%
Stock Dividend
2000
6,426
106.8
0.86
1.72
20.28
0.50
5/00 -
5%
Stock Dividend
1999
6,360
106.3
0.81
1.75
18.35
0.48
5/99 -
5%
Stock Dividend
1998
5,541
97.3
0.78
1.82
18.47
0.43
5/98 -
5:4
Stock Split
1997
5,091
85.0
0.71
1.67
18.88
0.38
5/97 -
5%
Stock Dividend
1996
4,687
67.5
0.62
1.47
17.23
0.34
5/96 -
5%
Stock Dividend
1995
4,586
62.6
0.57
1.40
16.60
0.32
5/95 -
5%
Stock Dividend
1994
3,744
59.0
0.63
1.60
20.03
0.30
5/94 -
10%
Stock Dividend
1993
3,605
56.4
0.61
1.62
21.42
0.24
4/93 -
5:4
Stock Split
1992
3,357
43.4
0.48
1.36
19.17
0.21
4/92 -
3:2
Stock Split
1991
3,055
31.7
0.35
1.29
15.40
0.20
Period End
Total Assets
Net Income
(2)
Common Stock Splits and Dividends
Diluted
Earnings Per
Common
Share
Return on
Average
Assets
Return on
Average
Equity
Cash Dividends
Declared Per
Common Share
4
Shareholder Returns
(1) All per share amounts have been adjusted retroactively for stock
splits and stock dividends during the periods presented. (2) Net income
includes other-than-temporary impairment charges on investment securities totaling $517 thousand, $2.9 million, $4.0 million,
$49.9 million, and $10.4 million, net of tax benefit, for the period ended March
31, 2011 and December 31, 2010, 2009, 2008, and 2007, respectively. |
 Valley
National Bank Today About Valley
Regional Bank Holding Company
Approximately $14.4 Billion in
Assets
Headquartered in Wayne, New
Jersey
46
th
Largest United States
Chartered
Commercial Bank
Largest Commercial Bank
Headquartered in New Jersey
Operates 198 Branches in 134
Communities Serving 14 counties
throughout Northern and Central
New Jersey, Manhattan, Brooklyn
and Queens
Traded on the NYSE (VLY)
Significant Attributes
Consistent Shareholder Returns
Focus on Credit Quality
Conservative Strategies
Affluent and Heavily Populated
Footprint
Strong Customer Service
Experienced Senior and Executive
Management
5 |
 6
Management Approach
Large percentage of retail ownership
Long-term investment approach
Focus on cash and stock dividends
Large insider ownership, family members, retired
employees and retired directors
Market Cap of $2.3 Billion
Approximately 246 institutional holders
37.74% of total outstanding shares
Source: Bloomberg as of 5/2/11
Large Bank that Operates and Feels Like a Small Closely Held Company
|
 7
Valley’s 1Q 2011 Highlights
Loan Growth
Total loans increased by $180.4 million linked quarter, or 7.7% on an annualized basis,
to $9.5 billion
Commercial & Industrial: 7.57% annualized growth linked quarter
Commercial Real Estate: 7.31% annualized growth linked quarter
Residential Mortgage: 25.44% annualized growth linked quarter
Consumer Loans: (7.21%) annualized decline linked quarter
Credit Quality
Total 30+ day delinquencies were 1.70% of entire loan portfolio
Total non-accrual loans declined during 1Q to 1.06% of total loans
Out of approximately 22,000 residential mortgages and home equity loans, only 249 loans were
past due 30 days
or more at March 31, 2011 and less than 100 loans were in foreclosure.
Net charge-offs were $3.8 million or 0.16% of average total loans on an annualized
basis Allowance for non-covered loan losses as a percentage of non-covered
loans decreased to 1.30% from 1.31% at December 31, 2010.
Net Income
1Q
net
income
available
to
common
shareholders
was
$36.6
million
($0.22
Diluted
EPS),
a
34%
increase over 1Q 2010
Capital
Strong capital ratios |
 8
Equity Composition / Ratios*
Total Tier II Equity = $1.4 Billion
As of 03/31/11
Significant unrealized gain on facilities, referenced in slide 9,
not incorporated in capital ratios reflected above.
*Non-GAAP reconciliations shown on slide 30.
Capital Ratios
As of
03/31/2011
“Well
Capitalized”
Tangible Common Equity /
Tangible Assets
6.88%
N/A
Tangible Common Equity /
Risk-Weighted Assets
9.18%
N/A
Tier I Common Ratio
9.32%
N/A
Tier I
11.00%
6.00%
Tier II
13.01%
10.00%
Leverage
8.32%
5.00%
Book Value
$7.71
N/A
Tangible Book Value
$5.68
N/A |
 9
Asset and Loan Composition
Total Assets = $14.4 Billion
As of 03/31/2011
Non-Covered Loans (Gross) = $9.2 Billion
*Other Assets includes bank owned branch locations carried at a
cost estimated by management to be significantly less than the
current market value.
Construction
Loans
5% |
 10
Total Commercial Real Estate -
$3.3 Billion
(Non-Covered Loans)
As of 02/28/11
Primary Property
Type
$ Amount
(Millions)
% of
Total
Average
LTV
Retail
887
27%
49%
Industrial
652
20%
52%
Office
430
13%
54%
Mixed Use
366
11%
45%
Apartments
364
11%
52%
Healthcare
233
7%
60%
Specialty
209
6%
49%
Residential
79
2%
49%
Land Loans
65
2%
63%
Other
26
1%
49%
Diversified Commercial Real Estate Portfolio
-Average LTV based on current balances and most recent appraised value
-The total CRE loan balance is based on Valley’s internal loan hierarchy
structure and does not reflect loan classifications reported in Valley’s SEC
and bank regulatory reports.
-The chart above does not include $373 million in construction loans.
|
 11
Total Retail Property Types -
$887 Million
(Non-Covered Loans)
Retail Composition of Commercial Real Estate
-Average LTV based on current balances and most recent appraised value
-The chart above does not include construction loans.
As of 02/28/11
Retail Property Type
% of
Total
Average
LTV
Multi-Tenanted -
Anchor
27%
49%
Single Tenant
22%
50%
Multi-Tenanted -
No Anchor
18%
53%
Auto Dealership
12%
51%
Private & Public Clubs
6%
31%
Food Establishments
6%
53%
Private Education Facilities
4%
51%
Entertainment Facilities
3%
39%
Auto Servicing
2%
51% |
 12
Construction Loan Composition
Total (Non-Covered) Construction Loans -
$373 Million
Primary Property Type
$ Amount
(Millions)
% of
Total
Residential
149
40%
Retail
56
15%
Land Loans
50
14%
Mixed Use
36
10%
Apartments
30
8%
Other
16
4%
Office
12
3%
Specialty
12
3%
Healthcare
7
2%
Industrial
5
1%
-Construction loan balance is based on Valley’s internal loan hierarchy
structure and does not reflect loan classifications reported in Valley’s SEC
and bank regulatory reports.
As of 02/28/11 |
 13
Loan Quality 1992 –
1Q 2011
Source –
FDIC
Recession
Total Loan Portfolio
*Non-Current Loans: Loans and leases 90 days or more past due plus loans in non
accrual status, as a percent of gross loans and leases. |
 14
Net Charge-offs to Average Loans
Source -
SNL Financial As of 4/29/11
Peer group consists of banks with total assets between $3 billion and $50 billion.
2003 -
2010
1Q 2011 |
 15
Investment Portfolio
2011
Investment Types
2007
40%
GSE MBS (GNMA)
3%
18%
GSE MBS (FNMA/FHLMC)
49%
12%
Trust Preferred
12%
9%
State, County & Municipals
7%
8%
US Treasury
0%
7%
Other
7%
3%
Corporate Debt
17%
3%
Private Label MBS
5%
$3.2 Billion
Investment Portfolio
$3.1 Billion
As of 03/31/11 and 12/31/07
Duration of MBS Securities
2.44 Years
2.64 Years |
 16
Securities by Investment Grade
AAA Rated 71%
AA Rated 5%
A Rated 5%
BBB Rated 6%
Non Investment Grade 4%
Not Rated 9%
As of 03/31/2011 |
 17
Deposits and Borrowings Composition
Total Liabilities = $13.1 Billion
As of 03/31/2011
Total Deposits = $9.7 Billion |
 Merger
Overview 18 |
 Strategic
Rationale for Transaction •
Powerful Super Community Bank Franchise
–
Strategic
eastward
geographic
extension
into
a
contiguous
market
for
Valley
–
Strong middle market commercial lender which matches up with
Valley’s historic strengths
–
Significant core deposit funding franchise
–
Utilizes strong management team with extensive Long Island expertise
–
Clean balance sheet
•
Shared Vision of Banking
–
Relationship bank
–
Conservative management culture
•
Financially Advantageous
–
Commitment to strong capital
–
Accretive to income within one year
19 |
 Summary of
Key Terms *Adjusted to reflect the 5% stock dividend declared by Valley
on 4/13/11
**Calculations
based
on
Valley’s
10
day
average
closing
share
price
(4/14/11
–
4/28/11)
20 |
 Valley’s
Eastward Expansion •
New York City
–
Acquired Merchants Bank in 2001 (7 branches)
–
Opened 7 De Novo locations
–
Acquired 2 locations with LibertyPointe and Park Avenue acquisitions
•
Brooklyn and Queens
–
Opened 13 De Novo locations since 2007
–
Acquired deposits and lending relationships from LibertyPointe and Park Avenue
acquisitions
•
Long Island
–
Due diligence on Valley’s expansion into Long Island commenced in 2008
•
Continuation of Valley’s eastward franchise expansion, Long Island phase restrained
between 2008 and 2010 due to economic uncertainty and lack of strong acquisition
candidate(s) –
Significant opportunities to fill in franchise
•
Opportunity to grow via De Novo branching
•
Still receptive to grow via acquisition
21 |
 Strategic
Fit Valley’s New York Expansion Continues
2011 Total NY Relationships
•$2.9 billion in NY
deposits •$2.1 billion in
NY loans** * *Pro-forma deposits include State Bancorp;
pro-forma loans are inclusive of VLY C&I and State Bancorp 2001+ De
Novo Branches Manhattan -
9
2007+ Brooklyn/Queens
Brooklyn –
8
Queens -
5
State Bank Branches
Queens –
3
Nassau –
8
Suffolk –
5
Manhattan -
1
VLY NJ Branches -
169
2001 Merchant’s Branches
Manhattan -
7
2001 Total NY Relationships
•$950 million in NY deposits
•$473 million in NY
loans* * NY loans include C&I loans only
22 |
 Demographic
Overview •
Familiar & Strong Demographics
–
High net worth marketplace
–
Population density
–
Large average deposits per branch
–
Significant number of businesses within marketplace
*
Core
Market
Includes
Passaic,
Morris,
Hudson,
Essex
and
Bergen
Counties
23 |
 Future
Opportunities •
Ability to lever Valley’s capital to grow Long Island Franchise
–
Opportunity to fill in Nassau and Suffolk county geography
•
Consumer Lending
–
Opportunity to introduce new products (State Bancorp does
not actively pursue consumer lending relationships)
•
Valley’s residential mortgage products
•
Valley’s consumer lending (auto & home equity) products
•
Commercial Lending
–
Opportunity to expand relationships
•
Larger lending limit
24 |
 Pro-Forma
Impact * Pro-Forma assets, loans and deposits have not been adjusted to
reflect purchase accounting adjustments. (1) Adjusted to reflect
Valley’s 5% stock dividend declared on April 13, 2011 25
|
 3/31/2011
Loan Mix Pro-Forma Impact
26 |
 3/31/2011
Deposit Mix Pro-Forma Impact
27 |
 Acquisition
History •
Customer Friendly
•
Employee Friendly
•
Seamless Transitions
•
Quick Conversions
28 |
 29
For More Information
Log onto our web site: www.valleynationalbank.com
E-mail requests to: dgrenz@valleynationalbank.com
Call Shareholder Relations at: (973) 305-3380
Write to: Valley National Bank
1455 Valley Road
Wayne, New Jersey 07470
Attn: Dianne M. Grenz, First Senior Vice President
Director of Marketing, Shareholder & Public Relations
Log onto our website above or www.sec.gov to obtain free copies of
documents filed by Valley with the SEC |
 30
03/31/2011
Non-GAAP Disclosure Reconciliations
($ in Thousands)
Total Assets
$14,363,839
Less: Goodwill & Other Intangible Assets
(343,214)
Total Tangible Assets (TA)
$14,020,625
Total Equity
$1,307,524
Less: Goodwill & Other Intangible Assets
(343,214)
Total Tangible Common Equity (TCE)
$964,310
Risk Weighted Assets (RWA)
$10,503,160
Ratios
TCE / TA
6.88%
TCE / RWA
9.18%
Tier I Common Ratio
(Tier 1 common
/RWA)
9.32%
Tier I
(Total Tier I / RWA)
11.00%
Tier II
(Total Tier II / RWA)
13.01%
Total Equity
$1,307,524
Less: Net unrealized gains on securities available
for sale
(14,042)
Plus: Accumulated net gains (losses) on cash
flow hedges, net of tax
(459)
Plus: Pension liability adjustment, net of tax
18,106
Less: Goodwill
(317,891)
Less: Other disallowed intangible assets
(14,489)
Tier I Common Capital
$978,749
Plus: Trust preferred securities
$176,313
Total Tier I Capital
$1,155,062
Plus: Allowance for credit losses
$131,173
Plus: Unrealized Gains on AFS equity securities
657
Plus: Qualifying sub debt
80,000
Total Tier II Capital
$1,366,892 |
 31
Common Shares Outstanding
169,678,227
Shareholders’
Equity
$1,307,524
Less: Goodwill and Other Intangible
Assets
(343,214)
Tangible Shareholders’
Equity
$964,310
Tangible Book Value
$5.68
03/31/2011
Non-GAAP Disclosure Reconciliations
($ in Thousands) |