What changed in this filing

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Item 1. Financial Statements

2023-08-07 compared with 2023-05-08 · 381 added, 211 removed, 1195 unchanged (33% of the section changed)

11 unchanged sentences

Available for sale debt securities 1,236,946 1,261,397

Held to maturity debt securities (net of allowance for credit losses of $ 1,633 at March 31, 2023 and $ 1,646 at December 31, 2022)

Held to maturity debt securities (net of allowance for credit losses of $ 1,351 at June 30, 2023 and $ 1,646 at December 31, 2022)

3,765,487 3,827,338

26 unchanged sentences

50,000,000 authorized shares:

Series A ( 4,600,000 shares issued at March 31, 2023 and December 31, 2022)

Series A ( 4,600,000 shares issued at June 30, 2023 and December 31, 2022)

111,590 111,590

Series B ( 4,000,000 shares issued at March 31, 2023 and December 31, 2022)

Series B ( 4,000,000 shares issued at June 30, 2023 and December 31, 2022)

98,101 98,101

Common stock ( no par value, authorized 650,000,000 shares;

issued 507,896,910 shares at March 31, 2023 and December 31, 2022)

issued 507,896,910 shares at June 30, 2023 and December 31, 2022)

178,187 178,185

2 unchanged sentences

Accumulated other comprehensive loss ( 164,747 ) ( 164,002 )

Treasury stock, at cost ( 134,552 common shares at March 31, 2023 and 1,522,432 common shares at December 31, 2022)

Treasury stock, at cost ( 277,480 common shares at June 30, 2023 and 1,522,432 common shares at December 31, 2022)

( 1,988 ) ( 21,748 )

6 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Interest Income

14 unchanged sentences

Net Interest Income 419,765 418,160 855,785 735,829

Provision for credit losses for available for sale and held to maturity securities 4,987 57

(Credit) provision for credit losses for available for sale and held to maturity securities ( 282 ) 286 4,705 343

Provision for credit losses for loans 6,332 43,712 15,782 47,212

34 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Net income $ 139,060 $ 96,413 $ 285,611 $ 213,141

Other comprehensive income (loss), net of tax:

Other comprehensive loss, net of tax:

Unrealized gains and losses on available for sale securities

Net gains (losses) arising during the period 17,170 ( 38,892 )

Net losses arising during the period ( 18,051 ) ( 52,269 ) ( 881 ) ( 91,161 )

Less reclassification adjustment for net gains included in net income — — — ( 10 )

1 unchanged sentence

Unrealized gains and losses on derivatives (cash flow hedges)

Net gains on derivatives arising during the period 2,798 218

Less reclassification adjustment for net losses included in net income 379 386

Net (losses) gains on derivatives arising during the period ( 3,573 ) ( 23 ) ( 775 ) 195

Less reclassification adjustment for net losses (gains) included in net income 516 ( 80 ) 895 306

Total ( 3,057 ) ( 103 ) 120 501

1 unchanged sentence

Amortization of actuarial net loss 8 133 16 265

Total other comprehensive income (loss) 20,355 ( 38,166 )

Total other comprehensive loss ( 21,100 ) ( 52,239 ) ( 745 ) ( 90,405 )

Total comprehensive income $ 117,960 $ 44,174 $ 284,866 $ 122,736

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)

For the Three Months Ended March 31, 2023

For the Six Months Ended June 30, 2023

Common Stock Accumulated

21 unchanged sentences

Balance - March 31, 2023 $ 209,691 507,762 $ 178,186 $ 4,967,662 $ 1,300,980 $ ( 143,647 ) $ ( 1,291 ) $ 6,511,581

Net income — — — — 139,060 — — 139,060

Other comprehensive loss, net of tax — — — — — ( 21,100 ) — ( 21,100 )

Cash dividends declared:

Preferred stock, Series A, $ 0.39 per share

— — — — ( 1,797 ) — — ( 1,797 )

Preferred stock, Series B, $ 0.56 per share

— — — — ( 2,233 ) — — ( 2,233 )

Common stock, $ 0.11 per share

— — — — ( 56,474 ) — — ( 56,474 )

Effect of stock incentive plan, net

— 157 1 6,845 ( 2 ) — 1,395 8,239

Common stock repurchased — ( 300 ) — — — — ( 2,092 ) ( 2,092 )

Balance - June 30, 2023

$ 209,691 507,619 $ 178,187 $ 4,974,507 $ 1,379,534 $ ( 164,747 ) $ ( 1,988 ) $ 6,575,184

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited) (continued)

For the Three Months Ended March 31, 2022

For the Six Months Ended June 30, 2022

Common Stock Accumulated

16 unchanged sentences

Effect of stock incentive plan, net — 972 — ( 10,799 ) ( 5,173 ) — 13,220 ( 2,752 )

Purchase of treasury stock — ( 1,015 ) — — — — ( 13,517 ) ( 13,517 )

Common stock repurchased — ( 1,015 ) — — — — ( 13,517 ) ( 13,517 )

Balance - March 31, 2022

$ 209,691 421,394 $ 148,482 $ 3,872,236 $ 945,225 $ ( 56,098 ) $ ( 23,152 ) $ 5,096,384

Net income — — — — 96,413 — — 96,413

Other comprehensive loss, net of tax — — — — — ( 52,239 ) — ( 52,239 )

Cash dividends declared:

Preferred stock, Series A, $ 0.39 per share

— — — — ( 1,797 ) — — ( 1,797 )

Preferred stock, Series B, $ 0.34 per share

— — — — ( 1,375 ) — — ( 1,375 )

Common stock, $ 0.11 per share

— — — — ( 56,211 ) — — ( 56,211 )

Effect of stock incentive plan, net — 72 1 5,125 ( 109 ) — 892 5,909

Common stock issued — 84,863 29,702 1,088,127 — — — 1,117,829

Balance - June 30, 2022

$ 209,691 506,329 $ 178,185 $ 4,965,488 $ 982,146 $ ( 108,337 ) $ ( 22,260 ) $ 6,204,913

See accompanying notes to consolidated financial statements.

2 unchanged sentences

(in thousands)

Three Months Ended

Six Months Ended

Cash flows from operating activities:

Net income $ 285,611 $ 213,141

Adjustments to reconcile net income to net cash (used in) provided by operating activities:

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization 21,425 18,297

3 unchanged sentences

Amortization of other intangible assets 20,331 15,837

Losses on available for sale and held to maturity debt securities, net 24 9

Losses (gains) on available for sale and held to maturity debt securities, net 33 ( 69 )

Proceeds from sales of loans held for sale 72,925 331,298

10 unchanged sentences

Accrued expenses and other liabilities 233,419 558,675

Net cash (used in) provided by operating activities ( 269,682 ) 496,003

Net cash provided by operating activities 282,682 805,531

Cash flows from investing activities:

8 unchanged sentences

Purchases ( 41,470 ) ( 38,000 )

Sales 17,910 12,846

Maturities, calls and principal repayments 44,534 150,262

2 unchanged sentences

Purchases of real estate property and equipment ( 49,468 ) ( 35,164 )

Cash distribution from tax credit investments 2,500 —

Cash and cash equivalent acquired in acquisitions, net — 321,540

3 unchanged sentences

(in thousands)

Three Months Ended

Six Months Ended

Cash flows from financing activities:

8 unchanged sentences

Other, net ( 15 ) ( 365 )

Net cash provided by (used in) financing activities 6,811,981 ( 229,710 )

Net cash provided by financing activities 3,704,158 1,858,819

Net change in cash and cash equivalents 1,006,462 ( 661,608 )

7 unchanged sentences

Transfer of loans to other real estate owned $ 903 $ —

Transfer of loans to loans held for sale 10,000 —

Lease right of use assets obtained in exchange for operating lease liabilities 81,727 24,745

Acquisitions:

Non-cash assets acquired:

Equity securities — 6,239

Investment securities available for sale — 505,928

Investment securities held to maturity — 806,627

Loans, net — 5,844,070

Premises and equipment, net — 38,827

Lease right of use assets — 49,434

Bank owned life insurance — 126,861

Accrued interest receivable — 25,717

Goodwill — 407,522

Other intangible assets, net — 159,587

Other assets — 158,352

Total non-cash assets acquired $ — $ 8,129,164

Liabilities assumed:

Deposits — 7,029,997

Short-term borrowings — 103,794

Lease liabilities — 79,844

Accrued expenses and other liabilities — 119,240

Total liabilities assumed $ — $ 7,332,875

Non-cash net assets acquired — 796,289

Net cash and cash equivalents acquired in acquisition $ — $ 321,540

Common stock issued in acquisition $ — $ 1,117,829

See accompanying notes to consolidated financial statements.

9 unchanged sentences

Certain prior period amounts have been reclassified to conform to the current presentation.

In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly Valley’s financial position, results of operations, changes in shareholders' equity and cash flows at March 31, 2023 and for all periods presented have been made.

The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the entire fiscal year or any subsequent interim period.

In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly Valley’s financial position, results of operations, changes in shareholders' equity and cash flows at June 30, 2023 and for all periods presented have been made.

The results of operations for the three and six months ended June 30, 2023 are not necessarily indicative of the results to be expected for the entire fiscal year or any subsequent interim period.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S.

21 unchanged sentences

owned approximately 14 percent of Valley's common stock as of April 1, 2022 .

Merger expenses, primarily consisting of salary and employee benefit expense, totaled $ 4.1 million and $ 4.4 million for the three months ended March 31, 2023 and 2022, respectively.

Merger expenses, primarily consisting of salary and employee benefit expense, totaled $ 4.1 million for the six months ended June 30, 2023.

There were no merger expenses for the three months ended June 30, 2023.

Merger expenses totaled $ 54.5 million and $ 58.9 million for the three and six months ended June 30, 2022, respectively,

and largely consisted of salary and employee benefit expense, professional and legal fees and technology related costs within non-interest expense on the consolidated statements of income.

The following table sets forth assets acquired and liabilities assumed in the Bank Leumi USA acquisition, at their estimated fair values as of the closing date of the transaction:

28 unchanged sentences

Cash paid in acquisition 113,441

There were no changes to the fair value estimates during the three months ended March 31, 2023.

Dudley Ventures.

On October 8, 2021, Valley acquired certain subsidiaries of Dudley Ventures, an advisory firm specializing in the investment and management of tax credits.

The transaction price included $ 11.3 million of cash at the closing date and fixed future stock consideration totaling $ 3.75 million, which resulted in the issuance of 327,083 shares of Valley common stock to the former principals of Dudley Ventures in February 2023.

Earnings Per Common Share

The following table shows the calculation of both basic and diluted earnings per common share for the three months ended March 31, 2023 and 2022:

The following table shows the calculation of both basic and diluted earnings per common share for the three and six months ended June 30, 2023 and 2022:

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

(in thousands, except for share and per share data)

10 unchanged sentences

Common stock options with exercise prices that exceed the average market price per share of Valley’s common stock during the periods presented may have an anti-dilutive effect on the diluted earnings per common share calculation and therefore are excluded from the diluted earnings per share calculation along with restricted stock units.

Potential anti-dilutive weighted common shares totaled approximately 1.6 million and 113 thousand for the three months ended March 31, 2023 and 2022, respectively.

Potential anti-dilutive weighted common shares totaled approximately 7.2 million and 2.2 million for the three months ended June 30, 2023 and 2022, respectively, and 3.0 million and 1.1 million for the six months ended June 30, 2023 and 2022, respectively.

Accumulated Other Comprehensive Loss

The following table presents the after-tax changes in the balances of each component of accumulated other comprehensive loss for the three months ended March 31, 2023:

The following tables present the after-tax changes in the balances of each component of accumulated other comprehensive loss for the three and six months ended June 30, 2023:

Components of Accumulated Other Comprehensive Loss Total

8 unchanged sentences

(in thousands)

Balance at December 31, 2022 $ ( 127,818 ) $ 2,233 $ ( 38,417 ) $ ( 164,002 )

Other comprehensive gain before reclassification 17,170 2,798 — 19,968

Amounts reclassified from other comprehensive income — 379 8 387

Other comprehensive income, net 17,170 3,177 8 20,355

Balance at March 31, 2023 $ ( 110,648 ) $ 5,410 $ ( 38,409 ) $ ( 143,647 )

The following table presents amounts reclassified from each component of accumulated other comprehensive loss on a gross and net of tax basis for the three months ended March 31, 2023 and 2022:

Other comprehensive loss before reclassification ( 18,051 ) ( 3,573 ) — ( 21,624 )

Amounts reclassified from other comprehensive loss — 516 8 524

Other comprehensive (loss) income, net ( 18,051 ) ( 3,057 ) 8 ( 21,100 )

Balance at June 30, 2023 $ ( 128,699 ) $ 2,353 $ ( 38,401 ) $ ( 164,747 )

Components of Accumulated Other Comprehensive Loss Total

Comprehensive

Unrealized Gains

and Losses on

Available for Sale

(AFS) Securities Unrealized Gains

and Losses on

Derivatives Defined Benefit

Pension and Postretirement Benefit Plans

(in thousands)

Balance at December 31, 2022 $ ( 127,818 ) $ 2,233 $ ( 38,417 ) $ ( 164,002 )

Other comprehensive loss before reclassification ( 881 ) ( 775 ) — ( 1,656 )

Amounts reclassified from other comprehensive loss — 895 16 911

Other comprehensive (loss) income, net ( 881 ) 120 16 ( 745 )

Balance at June 30, 2023 $ ( 128,699 ) $ 2,353 $ ( 38,401 ) $ ( 164,747 )

The following table presents amounts reclassified from each component of accumulated other comprehensive loss on a gross and net of tax basis for the three and six months ended June 30, 2023 and 2022:

Amounts Reclassified from

1 unchanged sentence

Three Months Ended

June 30, Six Months Ended

Components of Accumulated Other Comprehensive Loss 2023 2022 2023 2022 Income Statement Line Item

3 unchanged sentences

Total net of tax — — — 10

Unrealized losses on derivatives (cash flow hedges) before tax ( 531 ) ( 542 ) Interest expense

Unrealized gains (losses) on derivatives (cash flow hedges) before tax ( 725 ) 116 ( 1,256 ) ( 426 ) Interest income, interest expense

Tax effect 209 ( 36 ) 361 120

16 unchanged sentences

2022-02, “Financial Instruments – Credit Losses (Topic 326):

Troubled Debt Restructurings and Vintage Disclosures” eliminates the troubled debt restructuring (TDR) accounting model for creditors, such as Valley, that have adopted Topic 326, “Financial Instruments – Credit Losses.” ASU No.

Troubled Debt Restructurings and Vintage Disclosures” eliminates the troubled debt restructuring (TDR) accounting model for creditors, such as Valley, that

have adopted Topic 326, “Financial Instruments – Credit Losses.” ASU No.

2022-02 requires all loan modifications to be accounted for under the general loan modification guidance in Subtopic 310-20.

9 unchanged sentences

2023-02, Investments –“Equity Method and Joint Ventures (Topic 323):

Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method,” is intended to improve the accounting and

disclosures for investments in certain tax credit structures.

Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method,” is intended to improve the accounting and disclosures for investments in certain tax credit structures.

2023-02 allows the option to apply the proportional amortization method to account for investments made primarily for the purpose of receiving income tax credits and other income tax benefits when certain requirements are met.

4 unchanged sentences

Fair Value Measurement of Assets and Liabilities

ASC Topic 820, “Fair Value Measurements” establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value.

ASC Topic 820, “Fair Value Measurement” establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value.

The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

4 unchanged sentences

Assets and Liabilities Measured at Fair Value on a Recurring and Non-Recurring Basis

The following tables present the assets and liabilities that are measured at fair value on a recurring and non-recurring basis by level within the fair value hierarchy as reported on the consolidated statements of financial condition at March 31, 2023 and December 31, 2022.

The assets presented under “non-recurring fair value measurements” in the tables below are not measured at fair value on an ongoing basis but are subject to fair value adjustments under certain circumstances (e.g., when an impairment loss is recognized).

28 unchanged sentences

Non-recurring fair value measurements:

Non-performing loans held for sale $ 10,000 $ — $ 10,000 $ —

Collateral dependent loans 63,972 — — 63,972

33 unchanged sentences

Total $ 94,860 $ — $ — $ 94,860

(1) Represents residential mortgage loans held for sale that are carried at fair value and had contractual unpaid principal balances totaling approximately $ 17.1 million and $ 17.9 million at March 31, 2023 and December 31, 2022, respectively.

(1) Represents residential mortgage loans held for sale that are carried at fair value and had contractual unpaid principal balances totaling approximately $ 23.0 million and $ 17.9 million at June 30, 2023 and December 31, 2022, respectively.

(2) Derivative financial instruments are included in this category.

10 unchanged sentences

The fair value of trading debt securitie s, consisting of U.S.

Treasury securities and municipal bonds are reported at fair value utilizing Level 1 and Level 2 inputs, respectively.

The prices for municipal bonds investments are derived from market quotations and matrix pricing obtained through an independent pricing service.

Treasury securities are reported at fair value utilizing Level 1 inputs at June 30, 2023.

At December 31, 2022, trading debt securities consisted of U.S.

Treasury securities and municipal bonds reported at fair value utilizing Level 1 and Level 2 inputs, respectively.

The prices for municipal bonds investments were derived from market quotations and matrix pricing obtained through an independent pricing service.

Management reviews the data and assumptions used in pricing the securities by its third-party provider to ensure the highest level of significant inputs are derived from market observable data.

12 unchanged sentences

The market prices represent a delivery price, which reflects the underlying price each institution would pay Valley for an immediate sale of an aggregate pool of mortgages.

Non-performance risk did not materially impact the fair value of mortgage loans held for sale at March 31, 2023 and December 31, 2022 based on the short duration these assets were held, and the credit quality of these loans.

Non-performance risk did not materially impact the fair value of mortgage loans held for sale at June 30, 2023 and December 31, 2022 based on the short duration these assets were held, and the credit quality of these loans.

Derivatives are reported at fair value utilizing Level 2 inputs.

The fair values of Valley’s derivatives are determined using third-party prices that are based on discounted cash flow analysis using observed market inputs, such as the LIBOR, Overnight Index Swap and Secured Overnight Financing Rate (SOFR) curves for all cleared derivatives.

The fair value of mortgage banking derivatives, consisting of interest rate lock commitments to fund residential mortgage loans and forward commitments for the future delivery of such loans (including certain loans held for sale at March 31, 2023 and December 31, 2022), is determined based on the current market prices for similar instruments.

The fair values of Valley’s derivatives are determined using third-party prices that are based on discounted cash flow analysis using observed market inputs, such as the Overnight Index Swap and Secured Overnight Financing Rate (SOFR) curves.

The fair value of mortgage banking derivatives, consisting of interest rate lock commitments to fund residential mortgage loans and forward commitments for the future delivery of such loans (including certain loans held for sale at June 30, 2023 and December 31, 2022), is determined based on the current market prices for similar instruments.

The fair values of most of the derivatives incorporate credit valuation adjustments, which consider the impact of any credit enhancements to the contracts, to account for potential nonperformance risk of Valley and its counterparties.

The credit valuation adjustments were not significant to the overall valuation of Valley’s derivatives at March 31, 2023 and December 31, 2022.

The credit valuation adjustments were not significant to the overall valuation of Valley’s derivatives at June 30, 2023 and December 31, 2022.

Assets and Liabilities Measured at Fair Value on a Non-recurring Basis

The following valuation techniques were used for certain non-financial assets measured at fair value on a non-recurring basis, including collateral dependent loans reported at the fair value of the underlying collateral and foreclosed assets, which are reported at fair value upon initial recognition or subsequent impairment as described below.

Non-performing loans held for sale .

Valley transferred one non-performing construction loan totaling $ 10.0 million, net of charge-offs, to loans held for sale at June 30, 2023.

The transfer at the loan's fair value resulted in a $ 4.2 million charge-off to the allowance of loan losses for the three months ended June 30, 2023.

The fair value of the loan was determined using Level 2 inputs, including bids from a third party broker engaged to solicit interest from potential purchasers.

The broker coordinated loan level due diligence with interested parties and established a

formal bidding process in which each participant was required to provide an indicative non-binding bid.

Fair value was determined based on a non-binding sale agreement selected by Valley during the bidding process that is expected to close during the third quarter 2023.

Collateral dependent loans .

3 unchanged sentences

Certain real estate appraisals may be discounted based on specific market data by location and property type.

At March 31, 2023, collateral dependent loans were individually re-measured and reported at fair value through direct loan charge-offs to the allowance for loan losses based on the fair value of the underlying

At March 31, 2023, collateral dependent loans with a total amortized cost of $ 140.1 million, including our taxi medallion loan portfolio, were reduced by specific allowance for loan losses allocations totaling $ 58.8 million to a reported total net carrying amount of $ 81.3 million.

At June 30, 2023, collateral dependent loans were individually re-measured and reported at fair value through direct loan charge-offs to the allowance for loan losses based on the fair value of the underlying collateral.

At June 30, 2023, collateral dependent loans with a total amortized cost of $ 125.0 million, including our taxi medallion loan portfolio, were reduced by specific allowance for loan losses allocations totaling $ 61.0 million to a reported total net carrying amount of $ 64.0 million.

Foreclosed assets .

2 unchanged sentences

If further declines in the estimated fair value of the asset occur, an asset is re-measured and reported at fair value through a write-down recorded in non-interest expense.

There were no adjustments to the appraisals of foreclosed assets at March 31, 2023 and December 31, 2022 .

There were no adjustments to the appraisals of foreclosed assets at June 30, 2023 and December 31, 2022.

Other Fair Value Disclosures

8 unchanged sentences

In addition, the tax implications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in any of the estimates.

The carrying amounts and estimated fair values of financial instruments not measured and not reported at fair value on the consolidated statements of financial condition at March 31, 2023 and December 31, 2022 were as follows:

Hierarchy March 31, 2023 December 31, 2022

The carrying amounts and estimated fair values of financial instruments not measured and not reported at fair value on the consolidated statements of financial condition at June 30, 2023 and December 31, 2022 were as follows:

Hierarchy June 30, 2023 December 31, 2022

Amount Fair Value Carrying

34 unchanged sentences

Equity Securities

Equity securities totaled $ 50.2 million and $ 48.7 million at March 31, 2023 and December 31, 2022, respectively.

Equity securities totaled $ 61.0 million and $ 48.7 million at June 30, 2023 and December 31, 2022, respectively.

See Note 6 for further details on equity securities.

Trading Debt Securities

The fair value of trading debt securities totaled $ 6.9 million and $ 13.4 million at March 31, 2023 and December 31, 2022, respectively.

The fair value of trading debt securities totaled $ 3.4 million and $ 13.4 million at June 30, 2023 and December 31, 2022, respectively.

Net trading gains and losses were included in net gains and losses on securities transactions within non-interest income.

We recorded net trading gains of $ 402 thousand and net trading losses of $ 1.1 million for the three months ended March 31, 2023 and 2022, respectively.

We recorded net trading gains of $ 226 thousand and $ 628 thousand for the three and six months ended June 30, 2023, respectively.

We recorded net trading losses of $ 387 thousand and $ 1.4 million for the three and six months ended June 30, 2022, respectively.

Available for Sale Debt Securities

The amortized cost, gross unrealized gains and losses and fair value of available for sale debt securities at March 31, 2023 and December 31, 2022 were as follows:

The amortized cost, gross unrealized gains and losses and fair value of available for sale debt securities at June 30, 2023 and December 31, 2022 were as follows:

Losses Fair Value

(in thousands)

March 31, 2023

June 30, 2023

Treasury securities $ 310,936 $ — $ ( 28,538 ) $ 282,398

17 unchanged sentences

Total $ 1,437,911 $ 111 $ ( 176,625 ) $ 1,261,397

The age of unrealized losses and fair value of the related available for sale debt securities at March 31, 2023 and December 31, 2022 were as follows:

Accrued interest on investments, which is excluded from the amortized cost of available for sale debt securities, totaled $ 4.9 million and $ 5.6 million at June 30, 2023 and December 31, 2022, respectively, and is presented within total accrued interest receivable on the consolidated statements of financial condition.

The age of unrealized losses and fair value of the related available for sale debt securities at June 30, 2023 and December 31, 2022 were as follows:

Less than 12 Months More than 12 Months Total

3 unchanged sentences

(in thousands)

March 31, 2023

June 30, 2023

Treasury securities $ — $ — $ 282,398 $ ( 28,538 ) $ 282,398 $ ( 28,538 )

21 unchanged sentences

Total $ 874,061 $ ( 97,008 ) $ 380,921 $ ( 79,617 ) $ 1,254,982 $ ( 176,625 )

Within the available for sale debt securities portfolio, the total number of security positions in an unrealized loss position was 715 and 730 at March 31, 2023 and December 31, 2022, respectively.

As of March 31, 2023, the fair value of available for sale debt securities that were pledged to secure public deposits, repurchase agreements, lines of credit, and for other purposes required by law was $ 870.4 million.

The contractual maturities of available for sale debt securities at March 31, 2023 are set forth in the following table.

Within the available for sale debt securities portfolio, the total number of security positions in an unrealized loss position was 725 and 730 at June 30, 2023 and December 31, 2022, respectively.

As of June 30, 2023, the fair value of available for sale debt securities that were pledged to secure public deposits, repurchase agreements, lines of credit, and for other purposes required by law was $ 847.1 million.

The contractual maturities of available for sale debt securities at June 30, 2023 are set forth in the following table.

Maturities may differ from contractual maturities in residential mortgage-backed securities because the mortgages underlying the securities may be prepaid without any penalties.

Therefore, residential mortgage-backed securities are not included in the maturity categories in the following summary.

March 31, 2023

June 30, 2023

(in thousands)

6 unchanged sentences

Actual maturities of available for sale debt securities may differ from those presented above since certain obligations provide the issuer the right to call or prepay the obligation prior to scheduled maturity without penalty.

The weighted average remaining expected life for residential mortgage-backed securities available for sale was 8.91 years at March 31, 2023.

The weighted average remaining expected life for residential mortgage-backed securities available for sale was 7.68 years at June 30, 2023.

Impairment Analysis of Available For Sale Debt Securities

4 unchanged sentences

Based on a comparison of the present value of expected cash flows to the amortized cost, Valley recognized a credit related impairment of one corporate bond issued by Signature Bank resulting in a provision for credit losses and full charge-off of the bond totaling $ 5.0 million during the three months ended March 31, 2023.

Valley also evaluated available for sale debt securities that are in an unrealized loss position as of March 31, 2023 included in the table above and has determined that the declines in fair value are mainly attributable to interest rates, credit spreads, market volatility and liquidity conditions, not credit quality or other factors.

There was no impairment recognized during the three months ended March 31, 2022.

Accrued interest on investments, which is excluded from the amortized cost of available for sale debt securities, totaled $ 5.1 million and $ 5.6 million at March 31, 2023 and December 31, 2022, respectively, and is presented within total accrued interest receivable on the consolidated statements of financial condition.

The following table details the activity in the allowance for credit losses for the three months ended March 31, 2023.

Three Months Ended

March 31, 2023

Valley also evaluated available for sale debt securities that are in an unrealized loss position as of June 30, 2023 included in the table above and has determined that the declines in fair value are mainly attributable to interest rates, credit spreads, market volatility and liquidity conditions, not credit quality or other factors.

There was no impairment recognized during the three months ended June 30, 2023 and the three and six months ended June 30, 2022.

The following table details the activity in the allowance for credit losses for the six months ended June 30, 2023.

Six Months Ended June 30, 2023

(in thousands)

4 unchanged sentences

Valley does not intend to sell any of its available for sale debt securities in an unrealized loss position prior to recovery of their amortized cost basis, and it is more likely than not that Valley will not be required to sell any of its securities prior to recovery of their amortized cost basis.

None of the available for sale debt securities were past due

as of March 31, 2023 and there was no allowance for credit losses for available for sale debt securities at March 31, 2023, December 31, 2022 and March 31, 2022.

None of the available for sale debt securities were past due as of June 30, 2023 and there was no allowance for credit losses for available for sale debt securities at June 30, 2023, December 31, 2022 and June 30, 2022.

Held to Maturity Debt Securities

The amortized cost, gross unrealized gains and losses and fair value of debt securities held to maturity at March 31, 2023 and December 31, 2022 were as follows:

The amortized cost, gross unrealized gains and losses and fair value of debt securities held to maturity at June 30, 2023 and December 31, 2022 were as follows:

Losses Fair Value Allowance for Credit Losses Net Carrying Value

(in thousands)

March 31, 2023

June 30, 2023

Treasury securities $ 66,579 $ — $ ( 904 ) $ 65,675 $ — $ 66,579

19 unchanged sentences

Total $ 3,828,984 $ 2,105 $ ( 501,619 ) $ 3,329,470 $ 1,646 $ 3,827,338

The age of unrealized losses and fair value of related debt securities held to maturity at March 31, 2023 and December 31, 2022 were as follows:

Accrued interest on investments, which is excluded from the amortized cost of held to maturity debt securities, totaled $ 13.6 million and $ 13.5 million at June 30, 2023 and December 31, 2022, respectively, and is presented within total accrued interest receivable on the consolidated statements of financial condition.

Held to maturity debt securities are carried net of an allowance for credit losses.

The age of unrealized losses and fair value of related debt securities held to maturity at June 30, 2023 and December 31, 2022 were as follows:

Less than 12 Months More than 12 Months Total

3 unchanged sentences

(in thousands)

March 31, 2023

June 30, 2023

Treasury securities $ 30,998 $ ( 598 ) $ 34,677 $ ( 306 ) $ 65,675 $ ( 904 )

25 unchanged sentences

Total $ 1,610,100 $ ( 183,528 ) $ 1,492,658 $ ( 318,091 ) $ 3,102,758 $ ( 501,619 )

Within the held to maturity portfolio, the total number of security positions in an unrealized loss position was 766 and 802 at March 31, 2023 and December 31, 2022, respectively.

As of March 31, 2023, the fair value of debt securities held to maturity that were pledged to secure public deposits, repurchase agreements, lines of credit, and for other purposes required by law was $ 2.5 billion.

The contractual maturities of investments in debt securities held to maturity at March 31, 2023 are set forth in the table below.

Within the held to maturity portfolio, the total number of security positions in an unrealized loss position was 811 and 802 at June 30, 2023 and December 31, 2022, respectively.

As of June 30, 2023, the fair value of debt securities held to maturity that were pledged to secure public deposits, repurchase agreements, lines of credit, and for other purposes required by law was $ 2.4 billion.

The contractual maturities of investments in debt securities held to maturity at June 30, 2023 are set forth in the table below.

Maturities may differ from contractual maturities in residential mortgage-backed securities because the mortgages underlying the securities may be prepaid without any penalties.

Therefore, residential mortgage-backed securities are not included in the maturity categories in the following summary.

March 31, 2023

June 30, 2023

(in thousands)

6 unchanged sentences

Actual maturities of held to maturity debt securities may differ from those presented above since certain obligations provide the issuer the right to call or prepay the obligation prior to scheduled maturity without penalty.

The weighted-average remaining expected life for residential mortgage-backed securities held to maturity was 11.67 years at March 31, 2023.

The weighted-average remaining expected life for residential mortgage-backed securities held to maturity was 10.05 years at June 30, 2023.

Credit Quality Indicators

Valley monitors the credit quality of the held to maturity debt securities through the use of the most current credit ratings from external rating agencies.

The following table summarizes the amortized cost of held to maturity debt securities by external credit rating at March 31, 2023 and December 31, 2022.

The following table summarizes the amortized cost of held to maturity debt securities by external credit rating at June 30, 2023 and December 31, 2022.

AAA/AA/A Rated BBB rated Non-investment grade rated Non-rated Total

(in thousands)

March 31, 2023

June 30, 2023

Treasury securities $ 66,579 $ — $ — $ — $ 66,579

22 unchanged sentences

Obligations of states and political subdivisions include municipal bonds and revenue bonds issued by various municipal corporations.

At March 31, 2023, most of the obligations of states and political subdivisions were rated investment grade and a large portion of the "non-rated" category included tax exempt mortgage securities (TEMS) secured by Ginnie Mae securities.

At June 30, 2023, most of the obligations of states and political subdivisions were rated investment grade and a large portion of the "non-rated" category included tax exempt mortgage securities (TEMS) secured by Ginnie Mae securities.

Trust preferred securities consist of non-rated single-issuer securities, issued by bank holding companies.

5 unchanged sentences

government agency securities, residential mortgage-backed securities issued by Ginnie Mae, Fannie Mae and Freddie Mac, and TEMS collateralized municipal bonds.

Accrued interest on investments, which is excluded from the amortized cost of held to maturity debt securities, totaled $ 12.7 million and $ 13.5 million at March 31, 2023 and December 31, 2022, respectively, and is presented

within total accrued interest receivable on the consolidated statements of financial condition.

Held to maturity debt securities are carried net of an allowance for credit losses.

The following table details the activity in the allowance for credit losses for the three months ended March 31, 2023 and 2022:

Three Months Ended

The following table details the activity in the allowance for credit losses for the three and six months ended June 30, 2023 and 2022:

Three months ended June 30, Six months ended June 30,

2023 2022 2023 2022

(in thousands)

2 unchanged sentences

Ending balance $ 1,351 $ 1,508 $ 1,351 $ 1,508

There were no sales of available for sale and held to maturity debt securities debt securities during the three months ended March 31, 2023 and 2022, respectively.

There were no sales of available for sale and held to maturity debt securities during the three and six months ended June 30, 2023 and 2022, respectively.

Loans and Allowance for Credit Losses for Loans

The detail of the loan portfolio as of March 31, 2023 and December 31, 2022 was as follows:

March 31, 2023 December 31, 2022

The detail of the loan portfolio as of June 30, 2023 and December 31, 2022 was as follows:

June 30, 2023 December 31, 2022

(in thousands)

10 unchanged sentences

Total loans $ 49,877,248 $ 46,917,200

Total loans include net unearned discounts and deferred loan fees of $ 125.4 million and $ 120.5 million at March 31, 2023 and December 31, 2022, respectively.

Accrued interest on loans, which is excluded from the amortized cost of loans held for investment, totaled $ 192.6 million and $ 175.9 million at March 31, 2023 and December 31, 2022, respectively, and is presented within total accrued interest receivable on the consolidated statements of financial condition.

There were no sales of loans from the held for investment portfolio during the three months ended March 31, 2023 and 2022.

Total loans include net unearned discounts and deferred loan fees of $ 119.1 million and $ 120.5 million at June 30, 2023 and December 31, 2022, respectively.

Accrued interest on loans, which is excluded from the amortized cost of loans held for investment, totaled $ 202.1 million and $ 175.9 million at June 30, 2023 and December 31, 2022, respectively, and is presented within total accrued interest receivable on the consolidated statements of financial condition.

During the three months ended June 30, 2023, Valley transferred a non-performing construction loan totaling $ 10.0 million, net of $ 4.2 million charge-offs from the held for investment loan portfolio to loans held for sale.

See Note 6 for further details.

There we re no sales of loans from the held for investment portfolio during the three and six months ended June 30, 2023 and 2022.

Credit Risk Management

1 unchanged sentence

Management reviews and approves these policies and procedures on a regular basis with subsequent approval by the Board of Directors annually.

Credit authority relating to a significant dollar percentage of the overall portfolio is centralized and controlled by the Credit Risk Management Division and by the Credit Committee.

Credit authority relating to a

significant dollar percentage of the overall portfolio is centralized and controlled by the Credit Risk Management Division and by the Credit Committee.

A reporting system supplements the management review process by providing management with frequent reports concerning loan production, loan quality, internal loan classification, concentrations of credit, loan delinquencies, non-performing, and potential problem loans.

3 unchanged sentences

Credit Quality

The following table presents past due, current and non-accrual loans without an allowance for loan losses by loan portfolio class at March 31, 2023 and December 31, 2022:

The following table presents past due, current and non-accrual loans without an allowance for loan losses by loan portfolio class at June 30, 2023 and December 31, 2022:

Past Due and Non-Accrual Loans

6 unchanged sentences

(in thousands)

March 31, 2023

June 30, 2023

Commercial and industrial

40 unchanged sentences

Risk ratings are updated any time the situation warrants.

The following table presents the internal loan classification risk by loan portfolio class by origination year based on the most recent analysis performed at March 31, 2023 and December 31, 2022, as well as the gross loan charge-offs by year of origination for the three months ended March 31, 2023:

The following table presents the internal loan classification risk by loan portfolio class by origination year based on the most recent analysis performed at June 30, 2023 and December 31, 2022, as well as the gross loan charge-offs by year of origination for the six months ended June 30, 2023:

Amortized Cost Basis by Origination Year

March 31, 2023 2023 2022 2021 2020 2019 Prior to 2019 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Total

June 30, 2023 2023 2022 2021 2020 2019 Prior to 2019 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Total

(in thousands)

9 unchanged sentences

Substandard 10,972 30,664 35,577 27,280 36,320 237,578 7,830 — 386,221

Doubtful — — — 190 — — — — 190

Total commercial real estate $ 3,103,166 $ 6,758,975 $ 5,083,854 $ 3,211,757 $ 2,590,762 $ 6,484,153 $ 557,095 $ 3,310 $ 27,793,072

25 unchanged sentences

For residential mortgages, automobile, home equity and other consumer loan portfolio classes, Valley also evaluates credit quality based on the aging status of the loan and by payment activity.

The following table presents the amortized cost in those loan classes based on payment activity, by origination year as of March 31, 2023 and December 31, 2022, as well as the gross loan charge-offs by year of origination for the three months ended March 31, 2023:

The following table presents the amortized cost in those loan classes based on payment activity, by origination year as of June 30, 2023 and December 31, 2022, as well as the gross loan charge-offs by year of origination for the six months ended June 30, 2023:

Amortized Cost Basis by Origination Year

March 31, 2023 2023 2022 2021 2020 2019 Prior to 2019 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Total

June 30, 2023 2023 2022 2021 2020 2019 Prior to 2019 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Total

(in thousands)

45 unchanged sentences

This change resulted in the recognition of a cumulative-effect adjustment which decreased the allowance for loan losses with an offsetting entry to retained earnings, net of deferred taxes, at January 1, 2023.

The following table shows the amortized cost basis of loans to borrowers experiencing financial difficulty at March 31, 2023 that were modified during the three months ended March 31, 2023, disaggregated by class of financing receivable and type of modification.

The following table shows the amortized cost basis of loans to borrowers experiencing financial difficulty at June 30, 2023 that were modified during the three and six months ended June 30, 2023, disaggregated by class of financing receivable and type of modification.

Each of the types of modifications was less than one percent of their respective loan categories.

Three Months Ended March 31,

Term extension Term extension and interest rate reduction Total

Three Months Ended

June 30, 2023 Six Months Ended

June 30, 2023

Term extension Term extension and interest rate reduction Total Term extension Term extension and interest rate reduction Total

($ in thousands)

4 unchanged sentences

Total $ 41,852 $ 5,236 $ 47,088 $ 89,493 $ 5,757 $ 95,250

The following table describes the types of modifications made to borrowers experiencing financial difficulty during the three months ended March 31, 2023:

The following table describes the types of modifications made to borrowers experiencing financial difficulty during the three and six months ended June 30, 2023:

Types of Modifications

Commercial and industrial 12 month term extensions;

and 12 month term extensions combined with interest rate reductions from 2.11 percent to 1 percent

Commercial real estate 6 - 36 month term extensions

and one 12 month term extension combined with a reduction in interest rate from 9.38 percent to 6.50 percent

Commercial real estate 6 to 36 month term extensions and one term extension combined with a reduction in interest rate from 8.75 percent to 6.00 percent

Residential mortgage 12 month term extensions

1 unchanged sentence

Valley closely monitors the performance of modified loans to borrowers experiencing financial difficulty to understand the effectiveness of modification efforts.

All loans to borrowers experiencing financial difficulty that have been modified during the three months ended March 31, 2023 were current to their contractual payments as of March 31, 2023.

Valley did not extend any commitments to lend additional funds to borrowers experiencing financial difficulty whose loans had been modified during the three months ended March 31, 2023.

All loans to borrowers experiencing financial difficulty that have been modified during the three and six months ended June 30, 2023 were current to their contractual payments as of June 30, 2023.

Valley did not extend any commitments to lend additional funds to borrowers experiencing financial difficulty whose loans had been modified during the three and six months ended June 30, 2023.

Troubled debt restructured loans.

The following tables present the pre- and post-modification amortized cost of TDR loans by loan class during the three months ended March 31, 2022.

Post-modification amounts are presented as of March 31, 2022 using the allowance methodology for TDRs prior to the adoption of ASU 2022-02.

Three Months Ended March 31, 2022

The following tables present the pre- and post-modification amortized cost of TDR loans by loan class during the three and six months ended June 30, 2022.

Post-modification amounts are presented as of June 30, 2022 using the allowance methodology for TDRs prior to the adoption of ASU 2022-02.

Three Months Ended

June 30, 2022

Troubled Debt Restructurings Number

6 unchanged sentences

Residential mortgage 7 4,970 4,969

Consumer 1 125 124

Total 58 $ 96,026 $ 91,879

The total TDRs presented in the above tables had allocated allowance for loan losses of $ 7.8 million at March 31, 2022.

There were no charge-offs related to TDRs for the three months ended March 31, 2022.

Valley did not extend any commitments to lend additional funds to borrowers whose loans have been modified as TDRs during the three months ended March 31, 2022.

Performing TDRs (not reported as non-accrual loans) and non-performing TDRs totaled $ 56.5 million and $ 104.7 million as of March 31, 2022.

Loans modified as TDRs within the previous 12 months and for which there was a payment default ( 90 or more days past due) for the three months ended March 31, 2022 were as follows:

Three Months Ended March 31, 2022

Six Months Ended

June 30, 2022

Troubled Debt Restructurings Number

Contracts Pre-Modification

Outstanding Recorded Investment Post-Modification

Outstanding Recorded Investment

($ in thousands)

Commercial and industrial 60 $ 91,804 $ 87,685

Commercial real estate 3 14,072 13,986

Residential mortgage 8 5,090 5,087

Consumer 1 125 124

Total 72 $ 111,091 $ 106,882

The total TDRs presented in the above tables had allocated allowance for loan losses of $ 56.0 million at June 30, 2022.

There were $ 1.5 million in charge-offs related to TDRs for the three and six months ended June 30, 2022.

Valley did not extend any commitments to lend additional funds to borrowers whose loans have been modified as TDRs during the three and six months ended June 30, 2022.

Performing TDRs (not reported as non-accrual loans) and non-performing TDRs totaled $ 67.3 million and $ 154.4 million as of June 30, 2022.

Loans modified as TDRs within the previous 12 months and for which there was a payment default ( 90 or more days past due) for the three and six months ended June 30, 2022 were as follows:

Three Months Ended

June 30, 2022 Six Months Ended

June 30, 2022

Troubled Debt Restructurings Subsequently Defaulted Number of

Contracts Recorded

Investment Number of

Contracts Recorded

($ in thousands)

Commercial and industrial 2 $ 1,850

Construction 2 $ 17,599 2 $ 17,599

1 unchanged sentence

Loans in process of foreclosure.

Other real estate owned (OREO) totaled $ 1.2 million and $ 286 thousand at March 31, 2023 and December 31, 2022, respectively.

There were no foreclosed residential real estate properties included in OREO at March 31, 2023 and December 31, 2022.

Residential mortgage and consumer loans secured by residential real estate properties for which formal foreclosure proceedings are in process totaled $ 1.5 million and $ 2.6 million at March 31, 2023 and December 31, 2022, respectively.

Other real estate owned (OREO) totaled $ 824 thousand and $ 286 thousand at June 30, 2023 and December 31, 2022, respectively.

There were no foreclosed residential real estate properties included in OREO at June 30, 2023 and December 31, 2022.

Residential mortgage and consumer loans secured by residential real estate properties for which formal foreclosure proceedings are in process totaled $ 454 thousand and $ 2.6 million at June 30, 2023 and December 31, 2022, respectively.

Collateral dependent loans.

1 unchanged sentence

When Valley determines that foreclosure is probable, the collateral dependent loan balances are written down to the estimated current fair value (less estimated selling costs) resulting in an immediate charge-off to the allowance, excluding any consideration for personal guarantees that may be pursued in the Bank’s collection process.

The following table presents collateral dependent loans by class as of March 31, 2023 and December 31, 2022:

The following table presents collateral dependent loans by class as of June 30, 2023 and December 31, 2022:

2023 December 31,

9 unchanged sentences

The allowance for credit losses (ACL) for loans consists of the allowance for loan losses and the allowance for unfunded credit commitments.

The ACL for loans decreased $ 22.3 million at March 31, 2023 as compared to December 31, 2022.

The following table summarizes the ACL for loans at March 31, 2023 and December 31, 2022:

The ACL for loans decreased $ 24.6 million at June 30, 2023 as compared to December 31, 2022.

The following table summarizes the ACL for loans at June 30, 2023 and December 31, 2022:

2023 December 31,

6 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

(in thousands)

3 unchanged sentences

Total provision for credit losses for loans $ 6,332 $ 43,712 $ 15,782 $ 47,212

The following table details the activity in the allowance for loan losses by loan portfolio segment for the three months ended March 31, 2023 and 2022:

The following table details the activity in the allowance for loan losses by loan portfolio segment for the three and six months ended June 30, 2023 and 2022:

and Industrial Commercial

3 unchanged sentences

Three Months Ended

March 31, 2023

June 30, 2023

Allowance for loan losses:

Beginning balance $ 127,992 $ 243,332 $ 41,708 $ 23,866 $ 436,898

Loans charged-off ( 3,865 ) ( 6,273 ) ( 149 ) ( 1,040 ) ( 11,327 )

Charged-off loans recovered 2,173 4 135 390 2,702

Net charge-offs ( 1,692 ) ( 6,269 ) ( 14 ) ( 650 ) ( 8,625 )

Provision for loan losses 1,945 2,632 2,459 1,123 8,159

Ending balance $ 128,245 $ 239,695 $ 44,153 $ 24,339 $ 436,432

Three Months Ended

June 30, 2022

Allowance for loan losses:

Beginning balance $ 101,203 $ 219,949 $ 28,189 $ 13,169 $ 362,510

Allowance for purchased credit deteriorated (PCD) loans * 33,452 36,618 206 43 70,319

Loans charged-off ( 4,540 ) — ( 1 ) ( 726 ) ( 5,267 )

Charged-off loans recovered 1,952 224 74 697 2,947

Net (charge-offs) recoveries ( 2,588 ) 224 73 ( 29 ) ( 2,320 )

Provision for loan losses 12,472 20,436 1,421 3,981 38,310

Ending balance $ 144,539 $ 277,227 $ 29,889 $ 17,164 $ 468,819

Six Months Ended

June 30, 2023

Allowance for loan losses:

Beginning balance $ 139,941 $ 259,408 $ 39,020 $ 20,286 $ 458,655

Impact of the adoption of ASU No.

6 unchanged sentences

Ending balance $ 128,245 $ 239,695 $ 44,153 $ 24,339 $ 436,432

Three Months Ended

March 31, 2022

Six Months Ended

June 30, 2022

Allowance for loan losses:

Beginning balance $ 103,090 $ 217,490 $ 25,120 $ 13,502 $ 359,202

Allowance for PCD loans * 33,452 36,618 206 43 70,319

Loans charged-off ( 6,111 ) ( 173 ) ( 27 ) ( 1,551 ) ( 7,862 )

1 unchanged sentence

Net (charge-offs) recoveries ( 3,335 ) 158 504 403 ( 2,270 )

(Credit) provision for loan losses ( 1,140 ) 2,525 2,638 ( 765 ) 3,258

Provision for loan losses 11,332 22,961 4,059 3,216 41,568

Ending balance $ 144,539 $ 277,227 $ 29,889 $ 17,164 $ 468,819

The following table represents the allocation of the allowance for loan losses and the related loans by loan portfolio segment disaggregated based on the allowance measurement methodology at March 31, 2023 and December 31, 2022.

* Represents the allowance for acquired PCD loans, net of PCD loan charge-offs totaling $ 62.4 million in the second quarter 2022.

Commercial and Industrial Commercial

2 unchanged sentences

(in thousands)

March 31, 2023

June 30, 2023

Allowance for loan losses:

14 unchanged sentences

Goodwill and Other Intangible Assets

The carrying amounts of goodwill allocated to Valley's business segments, or reporting units thereof, for goodwill impairment analysis at both March 31, 2023 and December 31, 2022 were as follows:

The carrying amounts of goodwill allocated to Valley's business segments, or reporting units thereof, for goodwill impairment analysis at both June 30, 2023 and December 31, 2022 were as follows:

Business Segment / Reporting Unit *

6 unchanged sentences

This reporting unit is included in the Consumer Banking segment for financial reporting purposes.

During the three months ended March 31, 2023, there were no triggering events that would more likely than not

reduce the fair value of any reporting unit below its carrying amount.

There w as no impair ment of goodwill recognized during the three months ended March 31, 2023 and 2022.

The following table summarizes other intangible assets as of March 31, 2023 and December 31, 2022:

During the second quarter 2023, Valley performed the annual goodwill impairment test at its normal assessment date.

The results of the 2023 annual impairment test resulted in no impairment of goodwill.

During the six months ended June 30, 2023, there were no triggering events that would more likely than not reduce the fair value of any reporting unit below its carrying amount.

There was no impairment of goodwill recognized during the three and six months ended June 30, 2022.

The following table summarizes other intangible assets as of June 30, 2023 and December 31, 2022:

Assets Accumulated

1 unchanged sentence

(in thousands)

March 31, 2023

June 30, 2023

Loan servicing rights $ 120,764 $ ( 98,453 ) $ 22,311

11 unchanged sentences

Impairment charges on loan servicing rights are recognized in earnings when the book value of a stratified group of loan servicing rights exceeds its estimated fair value.

There was no net impairment recognized during the three months ended March 31, 2023 and 2022.

There was no net impairment recognized during the three and six months ended June 30, 2023 and 2022.

Core deposits are amortized using an accelerated method over a period of 10.0 years.

1 unchanged sentence

Valley evaluates core deposits and other intangibles for impairment when an indication of impairment exists.

No impairment was recognized during the three months ended March 31, 2023 and 2022.

No impairment was recognized during the three and six months ended June 30, 2023 and 2022.

The following table presents the estimated future amortization expense of other intangible assets for the remainder of 2023 through 2027:

7 unchanged sentences

2027 1,890 13,544 4,205

Valley recognized amortization expense on other intangible assets totaling approximately $ 10.5 million and $ 4.4 million for the three months ended March 31, 2023 and 2022, respectively .

Included in time deposits are certificates of deposit over $250 thousand totaling $ 1.7 billion and $ 1.8 billion at March 31, 2023 and December 31, 2022, respectively.

Interest expense on time deposits of $250 thousand or more total ed $ 2.8 million and $ 107 thousand for the three months ended March 31, 2023 and 2022, respectively.

The scheduled maturities of time deposits as of March 31, 2023 were as follows:

Valley recognized amortization expense on other intangible assets totaling approximately $ 9.8 million and $ 11.4 million for the three months ended June 30, 2023 and 2022, respectively and $ 20.3 million and $ 15.8 million for the six months ended June 30, 2023 and 2022, respectively.

Included in time deposits are certificates of deposit over $250 thousand totaling $ 2.0 billion and $ 1.8 billion at June 30, 2023 and December 31, 2022, respectively.

Interest expense on time deposits of $250 thousand or more total ed $ 5.1 million and $ 444 thousand for the three months ended June 30, 2023 and 2022, respectively and $ 7.5 million and $ 545 thousand for the six months ended June 30, 2023 and 2022, respectively.

The scheduled maturities of time deposits as of June 30, 2023 were as follows:

(in thousands)

5 unchanged sentences

Short-Term Borrowings

Short-term borrowings at March 31, 2023 and December 31, 2022 consisted of the following:

March 31, 2023 December 31, 2022

Short-term borrowings at June 30, 2023 and December 31, 2022 consisted of the following:

June 30, 2023 December 31, 2022

(in thousands)

2 unchanged sentences

Total short-term borrowings $ 1,088,899 $ 138,729

The weighted average interest rate for short-term FHLB advances was 5.18 percent and 1.6 percent at March 31, 2023 and December 31, 2022, respectively.

The weighted average interest rate for short-term FHLB advances was 5.30 percent and 1.60 percent at June 30, 2023 and December 31, 2022, respectively.

Long-Term Borrowings

Long-term borrowings at March 31, 2023 and December 31, 2022 consisted of the following:

March 31, 2023 December 31, 2022

Long-term borrowings at June 30, 2023 and December 31, 2022 consisted of the following:

June 30, 2023 December 31, 2022

(in thousands)

4 unchanged sentences

Total long-term borrowings $ 2,443,533 $ 1,543,058

(1) FHLB advances are presented net of unamortized premiums totaling $ 361 thousand and $ 419 thousand at March 31, 2023 and December 31, 2022, respectively.

(2) Subordinated debt is presented net of unamortized debt issuance costs totaling $ 6.5 million and $ 6.9 million at March 31, 2023 and December 31, 2022, respectively.

(1) FHLB advances are presented net of unamortized premiums totaling $ 311 thousand and $ 419 thousand at June 30, 2023 and December 31, 2022, respectively.

(2) Subordinated debt is presented net of unamortized debt issuance costs totaling $ 6.0 million and $ 6.9 million at June 30, 2023 and December 31, 2022, respectively.

FHLB Advances.

Long-term FHLB advances had a weighted average interest rate of 3.66 percent and 1.88 percent at March 31, 2023 and December 31, 2022, respectively.

Long-term FHLB advances had a weighted average interest rate of 3.75 percent and 1.88 percent at June 30, 2023 and December 31, 2022, respectively.

FHLB advances are secured by pledges of certain eligible collateral, including but not limited to, U.S.

government and agency mortgage-backed securities and a blanket assignment of qualifying first lien mortgage loans, consisting of both residential mortgage and commercial real estate loans.

The long-term FHLB advances at March 31, 2023 are scheduled for contractual balance repayments as follows:

government and agency mortgage-backed securities and a blanket

assignment of qualifying first lien mortgage loans, consisting of both residential mortgage and commercial real estate loans.

The long-term FHLB advances at June 30, 2023 are scheduled for contractual balance repayments as follows:

(in thousands)

4 unchanged sentences

Subordinated debt.

There were no new issuances of the subordinated debt during the three months ended March 31, 2023.

There were no new issuances of the subordinated debt during the six months ended June 30, 2023.

See Note 10 in Valley’s Annual Report on Form 10-K for the year ended December 31, 2022 for details on the outstanding subordinated debt.

4 unchanged sentences

Under the 2023 Plan, Valley may issue awards to its officers, employees and non-employee directors in amounts up to 14.5 million shares of common stock, less one share for every share granted after December 31, 2022 under the 2021 Plan.

These awards may be in the form of stock appreciation rights, incentive and non-qualified stock options, restricted stock, and restricted stock units (RSUs).

If after December 31, 2022, share awards granted under the 2021 Plan are forfeited, expire, settled for cash, withheld for tax obligations, or otherwise not issued, the shares will be added to the 2023 Plan's share reserve.

The grant, exercise, vesting, settlement, or payment of an award may be based upon the fair value of Valley's common stock on the last sale price reported for Valley's common stock on such date;

or the last sale price reported preceding such date.

Performance-based awards may also be based on a market condition.

The grant date fair values of performance-based awards that vest based on a market condition are determined by a third-party specialist using a Monte Carlo valuation model.

Valley granted 1.5 million and 1.2 million time-based RSUs during the three months ended March 31, 2023 and 2022, respectively.

Generally, time-based RSUs vest ratably over a three-year period.

The average grant date fair value of the RSUs granted during the three months ended March 31, 2023 and 2022 was $ 11.91 per share and $ 14.05 per share, respectively.

Valley granted 723 thousand and 567 thousand performance-based RSUs to certain officers for the three months ended March 31, 2023 and 2022, respectively.

The performance-based RSU awards include RSUs with vesting conditions based upon certain levels of growth in Valley's tangible book value per share, plus dividends;

Restricted stock units are awarded as performance-based RSUs and time-based RSUs.

The perfor mance-based RSU awards are granted to certain officers and include RSUs with vesting conditions based upon certain levels of growth in Valley's tangible book value per share, plus dividends;

and RSUs, with vesting conditions based upon Valley's total shareholder return as compared to its peer group.

The RSUs “cliff” vest after three years based on the cumulative performance of Valley during that time period.

The RSUs earn

dividend equivalents (equal to cash dividends paid on Valley's common stock) over the applicable performance period.

Dividend equivalents accumulate and are paid to the grantee at the vesting date, or forfeited if the performance conditions are not met.

The grant date fair value of the performance-based RSUs granted during the three months ended March 31, 2023 and 2022 was $ 12.80 per share and $ 14.82 per share, respectively.

Valley recorded total stock-based compensation expense of $ 8.1 million and $ 7.3 million for the three months ended March 31, 2023 and 2022, respectively.

The table below summarizes RSU awards granted and average grant date fair values for the three and six months ended June 30, 2023 and 2022:

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

(in thousands, except per share data)

Award shares granted:

Performance-based RSUs — 52 723 619

Time-based RSUs 178 937 1,731 2,104

Average grant date fair value per share:

Performance-based RSUs $ — $ 13.60 $ 12.80 $ 14.72

Time-based RSUs $ 8.35 $ 12.85 $ 11.55 $ 13.51

Stock award fair values are expensed over the shorter of the vesting or required service period.

As of March 31, 2023, the unrecognized amortization expense for all stock-based employee compensation totaled approximately $ 56.6 million.

Valley recorded total stock-based compensation expense of $ 8.7 million and $ 6.2 million for the three months ended June 30, 2023

and 2022, respectively and $ 16.8 million and $ 13.4 million for the six months ended June 30, 2023 and 2022, respectively.

As of June 30, 2023, the unrecognized amortization expense for all stock-based employee compensation totaled approximately $ 49.4 million.

This expense will be recognized over an average remaining vesting period of approximately 2.0 years.

See Note 12 in Valley’s Annual Report on Form 10-K for the year ended December 31, 2022 for details on the stock-based compensation awards.

Derivative Instruments and Hedging Activities

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Interest rate swaps designated as cash flow hedges involve the payment of either fixed or variable-rate amounts in exchange for the receipt of variable or fixed-rate amounts from a counterparty, respectively.

At March 31, 2023, Valley had six interest rate swaps with a total notional amount of $ 600 million, to hedge the changes in cash flows associated with certain variable rate loans.

Valley is required to pay variable rate amounts based on one-month CME Term SOFR and receives fixed rate payments based on the tenor of each swap.

Expiration dates for the swaps range from November 2024 to November 2026.

During the second quarter 2023, Valley terminated six interest rate swaps with a total notional amount of $ 600 million.

The terminated swaps, originally maturing between November 2024 to November 2026, were used to hedge the changes in cash flows associated with certain variable rate loans.

The transaction resulted in a pre-tax gain totaling $ 3.6 million reported in accumulated other comprehensive loss within shareholders' equity that will be amortized to interest income over the life of the previously hedged loans.

Fair Value Hedges of Fixed Rate Assets and Liabilities.

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Changes in the fair value in credit derivatives are recognized directly in earnings.

At March 31, 2023, Valley had 33 credit swaps with an aggregate notional amount of $ 409.2 million related to risk participation agreements.

At March 31, 2023, Valley had two “steepener” swaps, each with a current notional amount of $ 10.4 million where the receive rate on the swap mirrors the pay rate on the brokered deposits and the rates paid on these types of hybrid instruments are based on a formula derived from the spread between the long and short ends of the constant maturity swap (CMS) rate curve.

Although these types of instruments do not meet the hedge accounting requirements, the change in fair value of both the bifurcated derivative and the stand alone swap tend to move in opposite directions with changes in the three-month LIBOR rate and therefore provide an effective economic hedge.

At June 30, 2023, Valley had 36 credit swaps with an aggregate notional amount of $ 492.8 million related to risk participation agreements.

At June 30, 2023, Valley had two “steepener” swaps, each with a current notional amount of $ 10.4 million where the receive rate on the swap mirrors the pay rate on the brokered deposits and the rates paid on these types of hybrid instruments are based on a formula derived from the spread between the long and short ends of the constant maturity swap (CMS) rate curve.

Although these types of instruments do not meet the hedge accounting requirements, the change in fair value of both the bifurcated derivative and the stand alone swap tend to move in

opposite directions with changes in the three-month LIBOR rate (modified to the three-month Term SOFR rate effective July 1, 2023) and, therefore, provide an effective economic hedge.

Valley regularly enters into mortgage banking derivatives which are non-designated hedges.

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Amounts included in the consolidated statements of financial condition related to the fair value of Valley’s derivative financial instruments were as follows:

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

Fair Value Fair Value

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* Other derivative contracts include risk participation agreements.

The Chicago Mercantile Exchange and London Clearing House variation margins are classified as a single-unit of account as settlements of the cash flow hedges and other non-designated derivative instruments.

As a result, the fair value of the applicable derivative assets and liabilities are reported net of variation margin at March 31, 2023 and December 31, 2022 in the table above.

During the second quarter 2023, certain cash flow hedges and other non-designated derivative hedging instruments previously cleared through the Chicago Mercantile Exchange and London Clearing House were no longer subject to the variation margin netting under the single-unit of account .

At December 31, 2022, fair value of these non-designated derivative instruments were reported net of variation margin as settlements using a single-unit of account.

Gains (losses) included in the consolidated statements of income and other comprehensive loss, on a pre-tax basis, related to interest rate derivatives designated as hedges of cash flows were as follows:

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

(in thousands)

Amount of loss reclassified from accumulated other comprehensive loss to interest expense $ ( 531 ) $ ( 542 )

Amount of gain recognized in other comprehensive loss 3,898 320

The accumulated after-tax gains related to effective cash flow hedges included in accumulated other comprehensive loss were $ 5.4 million and $ 2.2 million at March 31, 2023 and December 31, 2022, respectively.

Amounts reported in accumulated other comprehensive loss related to cash flow interest rate derivatives are reclassified to interest expense as interest payments are made on the hedged variable interest rate liabilities.

Valley estimates that $ 2.1 million before tax will be reclassified as an increase to interest expense over the next 12 months.

Gains (losses) included in the consolidated statements of income related to interest rate derivatives designated as hedges of fair value were as follows:

Amount of (loss) gain reclassified from accumulated other comprehensive loss to interest income and expense $ ( 725 ) $ 116 $ ( 1,256 ) $ ( 426 )

Amount of (loss) gain recognized in other comprehensive loss ( 4,991 ) 121 ( 1,093 ) 441

The accumulated after-tax gains related to effective cash flow hedges included in accumulated other comprehensive loss were $ 2.4 million and $ 2.2 million at June 30, 2023 and December 31, 2022, respectively.

Amounts reported in accumulated other comprehensive loss related to cash flow interest rate derivatives are reclassified to interest income and expense as interest payments are received and paid on the hedged variable interest rate assets and liabilities.

Valley estimates that $ 1.2 million and $ 238 thousand (before tax) will be reclassified as an increase to interest income and a decrease to interest expense, respectively, over the next 12 months.

(Losses) gains included in the consolidated statements of income related to interest rate derivatives designated as hedges of fair value were as follows:

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

(in thousands)

4 unchanged sentences

The changes in the fair value of the hedged item designated as a qualifying hedge are captured as an adjustment to the carrying amount of the hedged item (basis adjustment).

The following table presents the hedged item related to interest rate derivatives designated as fair value hedges and the cumulative basis fair value adjustment included in the net carrying amount of the hedged item at March 31, 2023 and December 31, 2022, respectively.

Line Item in the Statement of Financial Position in Which the Hedged Item is Included Net Carrying Amount of the Hedged Liability * Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Liability

(in thousands)

March 31, 2023

June 30, 2023

Long-term borrowings $ 268,300 $ ( 29,312 )

1 unchanged sentence

Long-term borrowings $ 267,076 $ ( 30,132 )

* Net carrying amount includes unamortized debt issuance costs of $ 2.6 million and $ 2.8 million at March 31, 2023 and December 31, 2022, respectively.

The net losses (gains) included in the consolidated statements of income related to derivative instruments not designated as hedging instruments were as follows:

* Net carrying amount includes unamortized debt issuance costs of $ 2.4 million and $ 2.8 million at June 30, 2023 and December 31, 2022, respectively.

The net (gains) losses included in the consolidated statements of income related to derivative instruments not designated as hedging instruments were as follows:

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

(in thousands)

1 unchanged sentence

Other non-interest expense $ ( 368 ) $ 1,143 $ ( 160 ) $ ( 1,654 )

Capital markets income reported in non-interest income included fee income related to non-designated hedge derivative interest rate swaps (not designated as hedging instruments) executed with commercial loan customers and foreign exchange fees with a combined total of $ 9.9 million and $ 14.4 million for the three months ended March 31, 2023 and 2022, respectively.

Capital markets income reported in non-interest income included fee income related to non-designated hedge derivative interest rate swaps executed with commercial loan customers and foreign exchange contracts (not designated as hedging instruments) with a combined total of $ 14.1 million and $ 13.2 million for the three months ended June 30, 2023 and 2022, respectively and $ 24.0 million and $ 27.6 million for the six months ended June 30, 2023 and 2022, respectively.

Collateral Requirements and Credit Risk Related Contingent Features .

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If Valley’s credit rating is reduced below investment grade, or such rating is withdrawn or suspended, then the counterparties could terminate the derivative positions and Valley would be required to settle its obligations under the agreements.

As of March 31, 2023, Valley was in compliance with all of the provisions of its derivative counterparty agreements.

The aggregate fair value of all derivative financial instruments with credit risk-related contingent features in a net liability position at March 31, 2023 was not material.

As of June 30, 2023, Valley was in compliance with all of the provisions of its derivative counterparty agreements.

The aggregate fair value of all derivative financial instruments with credit risk-related contingent features in a net liability position at June 30, 2023 was not material.

Valley has derivative counterparty agreements that require minimum collateral posting thresholds for certain counterparties.

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The total amount of collateral held or pledged cannot exceed the net derivative fair values with the counterparty.

The table below presents information about Valley’s financial instruments eligible for offset in the consolidated statements of financial condition as of March 31, 2023 and December 31, 2022.

The table below presents information about Valley’s financial instruments eligible for offset in the consolidated statements of financial condition as of June 30, 2023 and December 31, 2022.

Gross Amounts Not Offset

6 unchanged sentences

(in thousands)

March 31, 2023

June 30, 2023

Interest rate swaps $ 548,592 $ — $ 548,592 $ 9,929 $ ( 468,200 ) $ 90,321

13 unchanged sentences

After initial measurement, the carrying amounts of tax credit investments with non-readily determinable fair values are increased to reflect Valley's share of income of the investee and are reduced to reflect its share of losses of the investee, dividends received and impairments, if applicable.

The following table presents the balances of Valley’s affordable housing tax credit investments, other tax credit investments, and related unfunded commitments at March 31, 2023 and December 31, 2022:

The following table presents the balances of Valley’s affordable housing tax credit investments, other tax credit investments, and related unfunded commitments at June 30, 2023 and December 31, 2022:

2023 December 31,

8 unchanged sentences

Total unfunded tax credit commitments $ 1,327 $ 1,338

The following table presents other information relating to Valley’s affordable housing tax credit investments and other tax credit investments for the three months ended March 31, 2023 and 2022:

The following table presents other information relating to Valley’s affordable housing tax credit investments and other tax credit investments for the three and six months ended June 30, 2023 and 2022:

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

(in thousands)

7 unchanged sentences

Affordable housing tax credit investment impairment losses

448 363 896 625

Other tax credit investment losses 719 386 725 695

2 unchanged sentences

Operating Segments

At March 31, 2023 and December 31, 2022, Valley managed its business operations under reportable segments consisting of Consumer Banking, Commercial Banking and Treasury and Corporate Other.

Valley manages its business operations under reportable segments consisting of Consumer Banking, Commercial Banking and Treasury and Corporate Other.

Each operating segment is reviewed routinely for its asset growth, contribution to income before income taxes and return on average interest earning assets and impairment (if events or circumstances indicate a possible inability to realize the carrying amount).

Valley regularly assesses its strategic plans, operations and reporting structures to identify its reportable segments and no changes to the reportable segments were determined necessary during the first quarter 2023.

Consumer Banking is mainly comprised of residential mortgages and automobile loans, and to a lesser extent, secured personal lines of credit, home equity loans and other consumer loans.

8 unchanged sentences

Expenses related to the branch network, all other components of retail banking, along with the back office departments of the Bank are allocated from Treasury and Corporate Other to the Consumer and Commercial Banking segments.

Interest expense and internal transfer expense (for general corporate expenses) are allocated to each operating segment utilizing a transfer pricing methodology, which involves the allocation of operating and funding costs based on each segment's respective mix of average earning assets and or liabilities outstanding for the period.

funding costs based on each segment's respective mix of average interest earning assets and or liabilities outstanding for the period.

The accounting for each segment includes internal accounting policies designed to measure consistent and reasonable financial reporting and may result in income and expense measurements that differ from amounts under U.S.

1 unchanged sentence

Furthermore, changes in management structure or allocation methodologies and procedures may result in changes in reported segment financial data.

The balances presented for the three months ended March 31, 2022 in the tables below reflect reclassifications to conform with the presentation of the current operating segment structure, which was implemented in the second quarter 2022.

These reclassifications did not impact Valley's consolidated results.

See Valley's Form 10-K for the year ended December 31, 2022 for additional information.

The following tables represent the financial data for Valley’s operating segments for the three months ended March 31, 2023 and 2022:

Three Months Ended March 31, 2023

The following tables represent the financial data for Valley’s operating segments for the three and six months ended June 30, 2023 and 2022:

Three Months Ended June 30, 2023

Banking Commercial

6 unchanged sentences

Net interest income 35,404 373,698 10,663 419,765

Provision (credit) for credit losses 3,492 2,840 ( 282 ) 6,050

Net interest income after provision for credit losses 31,912 370,858 10,945 413,715

Non-interest income 25,529 14,361 20,185 60,075

Non-interest expense 23,223 35,365 224,383 282,971

Internal transfer expense (income) 22,018 102,395 ( 124,413 ) —

Income (loss) before income taxes $ 12,200 $ 247,459 $ ( 68,840 ) $ 190,819

Return on average interest earning assets (pre-tax)

0.55 % 2.44 % ( 3.49 ) % 1.33 %

Three Months Ended June 30, 2022

Banking Commercial

Banking Treasury and Corporate Other Total

($ in thousands)

Average interest earning assets

$ 7,967,305 $ 34,549,982 $ 6,373,943 $ 48,891,230

Interest income $ 63,137 $ 352,440 $ 37,370 $ 452,947

Interest expense 4,723 19,735 10,329 34,787

Net interest income 58,414 332,705 27,041 418,160

Provision for credit losses 5,402 38,310 286 43,998

6 unchanged sentences

0.69 % 1.47 % ( 0.48 ) % 1.09 %

Three Months Ended March 31, 2022

Six Months Ended June 30, 2023

Banking Commercial

14 unchanged sentences

0.30 % 2.37 % ( 2.33 ) % 1.40 %

Six Months Ended June 30, 2022

Banking Commercial

Banking Treasury and Corporate Other Total

($ in thousands)

Average interest earning assets

$ 7,848,764 $ 30,743,387 $ 6,017,817 $ 44,609,968

Interest income $ 122,596 $ 610,346 $ 60,463 $ 793,405

Interest expense 7,930 31,062 18,584 57,576

Net interest income 114,666 579,284 41,879 735,829

Provision for credit losses 7,275 39,937 343 47,555

Net interest income after provision for credit losses 107,391 539,347 41,536 688,274

Non-interest income 30,903 31,305 35,595 97,803

Non-interest expense 35,359 49,533 412,178 497,070

Internal transfer expense (income) 66,276 257,281 ( 323,557 ) —

Income (loss) before income taxes $ 36,659 $ 263,838 $ ( 11,490 ) $ 289,007

Return on average interest earning assets (pre-tax)

0.93 % 1.72 % ( 0.38 ) % 1.30 %

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements