Attached files
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| 8-K - FORM 8-K - VALLEY NATIONAL BANCORP | d296985d8k.htm |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
Investor Presentation
EXHIBIT 99.1 |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
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: a continued weakness or
unexpected decline in the U.S. economy, in particular in New Jersey and the New York
Metropolitan area; other-than-temporary impairment charges on our investment
securities; higher than expected increases in our allowance for loan losses; higher than expected increases in loan
losses or in the level of nonperforming loans; unexpected changes in interest rates; higher
than expected tax rates, including increases resulting from changes in tax laws,
regulations and case law; a continued or unexpected decline in real estate values within our market areas; declines in
value in our investment portfolio; charges against earnings related to the change in fair
value of our junior subordinated debentures; higher than expected FDIC insurance
assessments; the failure of other financial institutions with whom we have trading, clearing, counterparty and other
financial relationships; lack of liquidity to fund our various cash obligations; unanticipated
reduction in our deposit base; potential acquisitions that may disrupt our business;
government intervention in the U.S. financial system and the effects of and changes in trade and monetary and
fiscal policies and laws, including the interest rate policies of the Federal Reserve;
legislative and regulatory actions (including the impact of the Dodd-Frank Wall
Street Reform and Consumer Protection Act and related regulations) subject us to additional regulatory oversight which
may result in increased compliance costs and/or require us to change our business model;
changes in accounting policies or accounting standards; our inability to promptly adapt
to technological changes; our internal controls and procedures may not be adequate to prevent losses;
claims and litigation pertaining to fiduciary responsibility, environmental laws and other
matters; the possibility that the expected benefits of acquisitions will not be fully
realized, including lower than expected cash flows from covered loan pools acquired in FDIC-assisted transactions;
the inability to realize expected cost savings and revenue synergies from the merger of State
Bancorp with Valley in the amounts or in the timeframe anticipated; costs or
difficulties relating to the integration of State Bancorp’s systems might be greater than expected; inability to
retain State Bancorp’s customers and employees; and other unexpected material adverse
changes in our operations and earnings.
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, 2010 and our Quarterly Report on Form 10-Q for the quarterly period ended September
30, 2011. 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. |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
(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 $12.2 million, $2.9 million, $4.0 million,
$49.9 million, $10.4 million, and $3.0 million, net of tax benefit, for the years
ended December 31, 2011, 2010, 2009, 2008, 2007 and 2006 respectively. Historical
Financial Data (1) (Dollars in millions, except for share data)
2011
14,245
$
133.7
$
$0.79
0.94
%
10.20
%
$0.69
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
Years Ended
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
Shareholder Returns
3 |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
Valley National Bank Today
About Valley
Regional Bank Holding Company
Approximately $16 Billion in Assets
Headquartered in Wayne, New
Jersey
36
th
Largest United States
Chartered
Commercial Bank
One of the Largest Chartered
Commercial Banks
Headquartered in
New Jersey
Operates 211 Branches in 147
Communities Serving 16 counties
throughout Northern and Central
New Jersey, Manhattan, Brooklyn,
Queens and Long Island
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
Includes 1/1/2012 acquisition of State Bancorp, Inc
4 |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
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 $2.1 Billion
Approximately 286 institutional holders
Source: Bloomberg as of 2/6/2012
Large Bank that Operates and Feels Like a Small Closely Held Company
5 |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
Net Income
4Q net income available to common shareholders was $24.8 million
($0.15 Diluted EPS) after non-cash impairment
charges on investment securities and merger expenses totaling $13.4 million after taxes
($0.08 per common share) Net Interest Margin for 4Q 2011 was 3.74% on a tax equivalent
basis Loan Growth
Total non-covered loans increased by $173.1 million linked quarter, or 7.4% on an
annualized basis, to $9.5 billion excluding a $37.0 million short-term loan
to State Bancorp, Inc for the purposes of repaying TARP. Residential Mortgage: 20.8%
annualized growth linked quarter Commercial Real Estate: 5.6% annualized growth linked
quarter Commercial & Industrial: 1.8% annualized growth linked quarter excluding a
$37.0 million short-term loan to State Bancorp, Inc Consumer Loans: (2.1%)
annualized decline linked quarter Credit Quality
Total 30+ day delinquencies were 1.69% of entire loan portfolio
Total non-accrual loans were 1.27% of total loans
Out of approximately 23,000 residential mortgages and home equity loans, only 272 loans were
past due 30 days or
more at December 31, 2011.
Net charge-offs were $14.4 million or 0.59% of average total loans during 4Q 2011 on an
annualized basis compared with $4.8 million or 0.20% during 3Q 2011.
Capital
Strong capital ratios
State Bancorp, Inc. acquired by Valley National Bank effective 1/1/2012
Valley’s 4Q 2011 Highlights
6 |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
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
7 |
 Valley’s New
York Expansion Continues * *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
2012 State Bank
Queens –
3
Nassau –
8
Suffolk –
5
Manhattan -
1
VLY NJ Branches -
169
2001 Merchant’s Branches
Manhattan -
7
8
©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
2001 Total NY Relationships
•$950 million in NY deposits
•$473 million in NY
loans* * NY loans include C&I loans only
2012 Total NY Relationships
•$2.9 billion in NY
deposits •$2.1 billion in
NY loans** |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
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
9 |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
Significant unrealized gain on facilities, referenced in slide 9,
not incorporated in capital ratios reflected above.
Equity Composition / Ratios*
Total Tier II Equity = $1.3 Billion
As of 12/31/11
*Non-GAAP reconciliations shown on slide 20-21.
Capital Ratios
As of
12/31/2011
“Well
Capitalized”
Tangible Common Equity /
Tangible Assets
6.67%
N/A
Tangible Common Equity /
Risk-Weighted Assets
9.01%
N/A
Tier I Common Ratio
9.21%
N/A
Tier I
10.92%
6.00%
Tier II
12.75%
10.00%
Leverage
8.07%
5.00%
Book Value
$7.44
N/A
Tangible Book Value
$5.45
N/A
10
Tangible
Common
Equity 71%
Other
Equity 2%
Trust
Preferred
13%
Sub
debt 4%
LL Reserve
10% |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
*Other Assets includes bank owned branch locations carried at a
cost estimated by management to be significantly less than the
current market value.
Asset and Loan Composition
Total Assets = $14.2 Billion
As of 12/31/2011
Non-Covered Loans (Gross) = $9.5 Billion
Construction
Loans
4%
Commercial
Real Estate
38%
Residential
Mortgages
24%
Commercial
Loans
20%
Auto Loans
8%
Other
Consumer
6%
11
Non-Covered
Loans 67%
Covered Loans
2%
Securities 18%
Cash 3%
Intangible
Assets 2%
Total Other
Assets* 8% |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
Total Commercial Real Estate -
$3.4 Billion
(Non-Covered Loans)
As of 08/31/11
Primary Property
Type
$ Amount
(Millions)
% of
Total
Average
LTV
Retail
895
26%
50%
Industrial
642
19%
52%
Apartments
469
14%
41%
Office
420
12%
53%
Mixed Use
370
11%
45%
Healthcare
236
7%
61%
Specialty
212
6%
50%
Residential
84
2%
49%
Land Loans
64
2%
67%
Other
32
1%
40%
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 $359 Million in Construction loans.
12
26%
19%
14%
12%
11%
7%
6%
2%
2%
1% |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
Total Retail Property Types -
$895 Million
(Non-Covered Loans)
Retail Property Type
% of
Total
Average
LTV
Multi-Tenanted -
Anchor
25%
52%
Single Tenant
22%
51%
Multi-Tenanted -
No Anchor
21%
53%
Auto Dealership
11%
49%
Private & Public Clubs
7%
33%
Food Establishments
5%
54%
Entertainment Facilities
4%
45%
Private Education Facilities
3%
49%
Auto Servicing
2%
51%
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 08/31/11
13
25%
22%
21%
11%
7%
5%
4%
3%
2% |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
Construction Loan Composition
Total (Non-Covered) Construction Loans -
$359 Million
Primary Property Type
$ Amount
(Millions)
% of
Total
Residential
140
39%
Retail
40
11%
Land Loans
53
15%
Mixed Use
39
11%
Apartments
33
9%
Other
18
5%
Industrial
14
4%
Specialty
9
3%
Office
8
2%
Healthcare
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.
14
39%
11%
15%
11%
9%
5%
4%
3%
2%
1%
As of 08/31/11 |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
Net Charge-offs to Average Loans
Source -
SNL Financial As of 2/6/2012
Peer group consists of banks with total assets between $3 billion and $50 billion.
2003 -
2010
2011*
*Valley 2011 Charge-offs exclude covered loans
15
Total Loans
Consumer
Home Equity
Construction & Development
Commercial Loans
Commercial Real Estate
Total Loans
Consumer
Home Equity
Construction & Development
Commercial Loans
Commercial Real Estate
0.18%
0.55%
0.02%
0.08%
0.34%
0.03%
0.04%
0.67%
0.83%
0.29%
0.37%
0.30%
0.36%
0.09%
0.94%
0.67%
0.17%
0.13%
1.12%
2.07%
0.81%
0.88%
0.82%
0.86%
Valley
Peer Group
1.75%
0.39%
1.53%
3.92%
1-4 Family
1-4 Family |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
Investment Portfolio
2011
Investment Types
2007
41%
GSE MBS (GNMA)
3%
16%
GSE MBS (FNMA/FHLMC)
49%
13%
State, County & Municipals
7%
11%
Trust Preferred
12%
8%
Other
7%
4%
US Treasury
0%
4%
Corporate Debt
17%
3%
Private Label MBS
5%
$2.5 Billion
Investment Portfolio
$3.1 Billion
As of 12/31/11 and 12/31/07
Duration of MBS Securities
2.00 Years
2.64 Years
16 |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
Securities by Investment Grade
AAA Rated 69%
AA Rated 7%
A Rated 3%
BBB Rated 8%
Non Investment Grade 4%
Not Rated 9%
As of 12/31/2011
17
AAA Rated
AA Rated
A Rated
BBB Rated
Non-investment
grade
Not Rated |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
Deposits and Borrowings Composition
Total Liabilities = $13.0 Billion
As of 12/31/2011
Total Deposits = $9.7 Billion
18
Non-
Interest
Bearing
29%
Savings,
NOW and
MMDA
45%
Time
Deposits
26%
Total
Deposits
75%
Borrowings
2%
Borrowings
22%
Other
Liabilities
1%
Short-term
Long-term |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
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
19 |
 ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
Total Equity
$1,266,248
Total Assets
$14,244,507
Less: Net unrealized gains on securities
available for sale
16,056
Less: Goodwill & Other Intangible Assets
(338,780)
Plus: Accumulated net gains (losses) on
cash flow hedges, net of tax
13,084
Total Tangible Assets (TA)
$13,905,727
Plus: Pension liability adjustment, net of tax
29,559
Total Equity
$1,266,248
Less: Goodwill
(317,962)
Less: Goodwill & Other Intangible Assets
(338,780)
Less: Disallowed deferred tax asset
(48,129)
Total Tangible Common Equity (TCE)
$927,468
Less: Disallowed other intangible assets
(10,336)
Tier I Common Capital
$948,520
Ratios
Plus: Trust preferred securities
176,313
TCE / TA
6.67%
Total Tier I Capital
$1,124,833
TCE / RWA
9.01%
Plus: Qualifying allowance for credit losses
$128,112
Plus: Qualifying sub debt
60,000
Tier I (Total Tier I / RWA)
10.92%
Total Tier II Capital
$1,312,945
Tier II (Total Tier II / RWA)
12.75%
Risk Weighted Assets (RWA)
$10,296,317
Tier I Common Capital Ratio
(Tier 1 common /RWA)
9.21%
12/31/2011
Non-GAAP Disclosure Reconciliations
($ in Thousands)
20 |
  ©
2012 Valley National Bank. Member FDIC. Equal Opportunity Lender.
12/31/2011
Non-GAAP Disclosure Reconciliations
($ in Thousands)
Common Shares Outstanding
170,174,314
Shareholders’ Equity
$1,266,248
Less: Goodwill and Other
Intangible Assets
(338,780)
Tangible Shareholders’ Equity
$927,468
Tangible Book Value
$5.45
21 |