VALLEY NATIONAL BANCORP 10-Q

Item 1. Financial Statements VALLEY NATIONAL BANCORP CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (in thousands, except for share data) June 30, 2025 December 31, 2024 Assets (Unaudited) Cash and due from banks $ 440,870 $ 411,412 Interest bearing deposits with banks 745,547 1,478,713 Investment securities: Equity securities 77,408 71,513 Available for sale debt securities 3,896,205 3,369,724 Held to maturity debt securities (net of allowance for credit losses of $ 637 at June 30, 2025 and $ 647 at December 31, 2024) 3,530,924 3,531,573 Total investment securities 7,504,537 6,972,810 Loans held for sale (includes fair value of $ 9,146 at June 30, 2025 and $ 16,931 at December 31, 2024 for loans originated for sale) 28,096 25,681 Loans 49,391,420 48,799,711 Less: Allowance for loan losses ( 579,500 ) ( 558,850 ) Net loans 48,811,920 48,240,861 Premises and equipment, net 337,371 350,796 Lease right of use assets 332,324 328,475 Bank owned life insurance 735,026 731,574 Accrued interest receivable 238,278 239,941 Goodwill 1,868,936 1,868,936 Other intangible assets, net 114,579 128,661 Other assets 1,547,874 1,713,831 Total Assets $ 62,705,358 $ 62,491,691 Liabilities Deposits: Non-interest bearing $ 11,746,770 $ 11,428,674 Interest bearing: Savings, NOW and money market 26,091,633 26,304,639 Time 12,886,881 12,342,544 Total deposits 50,725,284 50,075,857 Short-term borrowings 162,244 72,718 Long-term borrowings 2,903,091 3,174,155 Junior subordinated debentures issued to capital trusts 57,629 57,455 Lease liabilities 392,633 388,303 Accrued expenses and other liabilities 889,056 1,288,076 Total Liabilities 55,129,937 55,056,564 Shareholders’ Equity Preferred stock, no par value; 50,000,000 authorized shares: Series A ( 4,600,000 shares issued at June 30, 2025 and December 31, 2024) 111,590 111,590 Series B ( 4,000,000 shares issued at June 30, 2025 and December 31, 2024) 98,101 98,101 Series C ( 6,000,000 shares issued at June 30, 2025 and December 31, 2024) 144,654 144,654 Common stock ( no par value, authorized 650,000,000 shares; issued 560,522,946 shares at June 30, 2025 and 558,786,093 shares at December 31, 2024) 196,606 195,998 Surplus 5,451,543 5,442,070 Retained earnings 1,694,903 1,598,048 Accumulated other comprehensive loss ( 119,889 ) ( 155,334 ) Treasury stock, at cost ( 241,125 common shares at June 30, 2025) ( 2,087 ) — Total Shareholders’ Equity 7,575,421 7,435,127 Total Liabilities and Shareholders’ Equity $ 62,705,358 $ 62,491,691 See accompanying notes to consolidated financial statements. 3 VALLEY NATIONAL BANCORP CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (in thousands, except for per share data) Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Interest Income Interest and fees on loans $ 720,282 $ 770,964 $ 1,423,891 $ 1,542,517 Interest and dividends on investment securities: Taxable 67,164 40,460 131,062 76,257 Tax-exempt 4,681 4,799 9,383 9,595 Dividends 5,528 6,341 11,192 13,169 Interest on federal funds sold and other short-term investments 7,357 10,902 14,236 20,584 Total interest income 805,012 833,466 1,589,764 1,662,122 Interest Expense Interest on deposits: Savings, NOW and money market 203,390 231,597 403,611 464,103 Time 129,324 160,442 254,393 311,507 Interest on short-term borrowings 1,736 691 4,682 21,303 Interest on long-term borrowings and junior subordinated debentures 38,154 39,051 74,565 69,976 Total interest expense 372,604 431,781 737,251 866,889 Net Interest Income 432,408 401,685 852,513 795,233 Provision (credit) for credit losses for available for sale and held to maturity securities 4 ( 41 ) ( 10 ) ( 115 ) Provision for credit losses for loans 37,795 82,111 100,470 127,385 Net Interest Income After Provision for Credit Losses 394,609 319,615 752,053 667,963 Non-Interest Income Wealth management and trust fees 14,056 13,136 29,087 31,066 Insurance commissions 3,430 3,958 6,832 6,209 Capital markets 9,767 7,779 16,707 13,449 Service charges on deposit accounts 14,705 11,212 27,431 22,461 (Losses) gains on securities transactions, net ( 1 ) 3 45 52 Fees from loan servicing 3,671 2,691 6,886 5,879 Gains on sales of loans, net 2,025 884 4,222 2,502 Bank owned life insurance 6,019 4,545 10,796 7,780 Other 8,932 7,005 18,892 23,230 Total non-interest income 62,604 51,213 120,898 112,628 Non-Interest Expense Salary and employee benefits expense 145,422 140,815 288,040 282,646 Net occupancy expense 25,483 24,252 51,371 48,575 Technology, furniture and equipment expense 30,667 35,203 60,563 70,665 FDIC insurance assessment 12,192 14,446 25,059 32,682 Amortization of other intangible assets 7,427 8,568 15,446 17,980 Professional and legal fees 19,970 17,938 35,640 34,403 Loss on extinguishment of debt 922 — 922 — Amortization of tax credit investments 9,134 5,791 18,454 11,353 Other 32,905 30,484 65,245 59,503 Total non-interest expense 284,122 277,497 560,740 557,807 Income Before Income Taxes 173,091 93,331 312,211 222,784 Income tax expense 39,924 22,907 72,986 56,080 Net Income 133,167 70,424 239,225 166,704 Dividends on preferred stock 6,948 4,108 13,903 8,227 Net Income Available to Common Shareholders $ 126,219 $ 66,316 $ 225,322 $ 158,477 Earnings Per Common Share: Basic $ 0.23 $ 0.13 $ 0.40 $ 0.31 Diluted 0.22 0.13 0.40 0.31 See accompanying notes to consolidated financial statements. 4 VALLEY NATIONAL BANCORP CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (in thousands) Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Net income $ 133,167 $ 70,424 $ 239,225 $ 166,704 Other comprehensive income (loss), net of tax: Unrealized gains and losses on available for sale securities Net gains (losses) arising during the period 8,496 ( 5,600 ) 35,708 ( 15,805 ) Amounts reclassified to earnings — 8 — 8 Total 8,496 ( 5,592 ) 35,708 ( 15,797 ) Unrealized losses on derivatives (cash flow hedges) Amounts reclassified to earnings ( 221 ) ( 210 ) ( 439 ) ( 432 ) Total ( 221 ) ( 210 ) ( 439 ) ( 432 ) Defined benefit pension and postretirement benefit plans Amortization of actuarial net loss 88 37 176 72 Total other comprehensive income (loss) 8,363 ( 5,765 ) 35,445 ( 16,157 ) Total comprehensive income $ 141,530 $ 64,659 $ 274,670 $ 150,547 See accompanying notes to consolidated financial statements. 5 VALLEY NATIONAL BANCORP CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited) For the Six Months Ended June 30, 2025 Common Stock Accumulated Preferred Stock Shares Amount Surplus Retained Earnings Other Comprehensive Loss Treasury Stock Total Shareholders’ Equity ($ in thousands) Balance - December 31, 2024 $ 354,345 558,786 $ 195,998 $ 5,442,070 $ 1,598,048 $ ( 155,334 ) $ — $ 7,435,127 Net income — — — — 106,058 — — 106,058 Other comprehensive income, net of tax — — — — — 27,082 — 27,082 Cash dividends declared: Preferred stock, Series A, $ 0.39 per share — — — — ( 1,797 ) — — ( 1,797 ) Preferred stock, Series B, $ 0.52 per share — — — — ( 2,065 ) — — ( 2,065 ) Preferred stock, Series C, $ 0.52 per share — — — — ( 3,094 ) — — ( 3,094 ) Common stock, $ 0.11 per share — — — — ( 62,460 ) — — ( 62,460 ) Effect of stock incentive plan, net — 1,492 522 2,686 — — — 3,208 Common stock repurchased — ( 250 ) — — — — ( 2,162 ) ( 2,162 ) Balance - March 31, 2025 $ 354,345 560,028 $ 196,520 $ 5,444,756 $ 1,634,690 $ ( 128,252 ) $ ( 2,162 ) $ 7,499,897 Net income — — — — 133,167 — — 133,167 Other comprehensive loss, net of tax — — — — — 8,363 — 8,363 Cash dividends declared: Preferred stock, Series A, $ 0.39 per share — — — — ( 1,797 ) — — ( 1,797 ) Preferred stock, Series B, $ 0.51 per share — — — — ( 2,057 ) — — ( 2,057 ) Preferred stock, Series C, $ 0.52 per share — — — — ( 3,094 ) — — ( 3,094 ) Common stock, $ 0.11 per share — — — — ( 62,466 ) — — ( 62,466 ) Effect of stock incentive plan, net — 504 86 6,787 ( 3,540 ) — 2,239 5,572 Common stock repurchased — ( 250 ) — — — — ( 2,164 ) ( 2,164 ) Balance - June 30, 2025 $ 354,345 560,282 $ 196,606 $ 5,451,543 $ 1,694,903 $ ( 119,889 ) $ ( 2,087 ) $ 7,575,421 6 For the Six Months Ended June 30, 2024 Common Stock Accumulated Preferred Stock Shares Amount Surplus Retained Earnings Other Comprehensive Loss Treasury Stock Total Shareholders’ Equity ($ in thousands) Balance - December 31, 2023 $ 209,691 507,710 $ 178,187 $ 4,989,989 $ 1,471,371 $ ( 146,456 ) $ ( 1,391 ) $ 6,701,391 Net income — — — — 96,280 — — 96,280 Other comprehensive income, net of tax — — — — — ( 10,392 ) — ( 10,392 ) Cash dividends declared: Preferred stock, Series A, $ 0.39 per share — — — — ( 1,797 ) — — ( 1,797 ) Preferred stock, Series B, $ 0.58 per share — — — — ( 2,322 ) — — ( 2,322 ) Common stock, $ 0.11 per share — — — — ( 56,794 ) — — ( 56,794 ) Effect of stock incentive plan, net — 1,183 348 ( 966 ) — — 1,391 773 Balance - March 31, 2024 $ 209,691 508,893 $ 178,535 $ 4,989,023 $ 1,506,738 $ ( 156,848 ) $ — $ 6,727,139 Net income — — — — 70,424 — — 70,424 Other comprehensive loss, net of tax — — — — — ( 5,765 ) — ( 5,765 ) Cash dividends declared: Preferred stock, Series A, $ 0.39 per share — — — — ( 1,797 ) — — ( 1,797 ) Preferred stock, Series B, $ 0.58 per share — — — — ( 2,311 ) — — ( 2,311 ) Common stock, $ 0.11 per share — — — — ( 56,678 ) — — ( 56,678 ) Effect of stock incentive plan, net — 312 110 6,615 — — — 6,725 Balance - June 30, 2024 $ 209,691 509,205 $ 178,645 $ 4,995,638 $ 1,516,376 $ ( 162,613 ) $ — $ 6,737,737 See accompanying notes to consolidated financial statements. 7 VALLEY NATIONAL BANCORP CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands) Six Months Ended June 30, 2025 2024 Cash flows from operating activities: Net income $ 239,225 $ 166,704 Adjustments to reconcile net income to net cash (used in) provided by operating activities: Depreciation and amortization 19,922 21,510 Stock-based compensation 13,651 15,718 Provision for credit losses 100,460 127,270 Net accretion of discounts and amortization of premium on securities and borrowings ( 3,618 ) ( 1,418 ) Amortization of other intangible assets 15,446 17,980 Losses on available for sale and held to maturity debt securities, net 11 11 Proceeds from sales of loans held for sale at fair value 90,628 145,310 Gains on sales of loans, net ( 4,222 ) ( 2,502 ) Originations of loans held for sale ( 80,509 ) ( 133,348 ) Gains on sales of assets, net ( 187 ) ( 3,692 ) Loss on extinguishment of debt 922 — Net change in: Fair value of financial instruments hedged by derivative transactions 7,048 6,083 Trading debt securities — ( 6 ) Lease right of use assets ( 4,192 ) 5,506 Cash surrender value of bank owned life insurance ( 10,464 ) ( 7,748 ) Accrued interest receivable 1,663 ( 5,669 ) Other assets 151,240 ( 176,362 ) Accrued expenses and other liabilities ( 394,992 ) 138,165 Net cash provided by operating activities 142,032 313,512 Cash flows from investing activities: Loans originated and purchased, net of principal collected ( 680,904 ) ( 496,413 ) Equity securities: Purchases ( 6,938 ) ( 4,691 ) Sales 715 751 Held to maturity debt securities: Purchases ( 159,213 ) ( 56,672 ) Maturities, calls and principal repayments 159,870 144,552 Available for sale debt securities: Purchases ( 682,591 ) ( 982,861 ) Maturities, calls and principal repayments 209,332 49,102 Death benefit proceeds from bank owned life insurance 7,012 5,667 Proceeds from sales of real estate property and equipment 2,277 2,974 Proceeds from sales of loans not originated for sale — 230,666 Proceeds from sale of commercial premium finance lending division — 98,060 Purchases of real estate property and equipment ( 6,154 ) ( 6,378 ) Net cash used in investing activities ( 1,156,594 ) ( 1,015,243 ) 8 VALLEY NATIONAL BANCORP CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (continued) (in thousands) Six Months Ended June 30, 2025 2024 Cash flows from financing activities: Net change in deposits $ 647,933 $ 869,348 Net change in short-term borrowings 89,526 ( 854,064 ) Proceeds from issuance of long-term borrowings, net 210,000 1,000,000 Repayments of long-term borrowings ( 488,000 ) ( 65,000 ) Cash dividends paid to preferred shareholders ( 13,903 ) ( 8,227 ) Cash dividends paid to common shareholders ( 125,248 ) ( 114,256 ) Purchase of common shares related to stock compensation plan activity ( 8,615 ) ( 8,271 ) Purchase of common shares to treasury ( 4,326 ) — Common stock issued, net 3,744 51 Other, net ( 257 ) ( 2 ) Net cash provided by financing activities 310,854 819,579 Net change in cash and cash equivalents ( 703,708 ) 117,848 Cash and cash equivalents at beginning of year 1,890,125 891,225 Cash and cash equivalents at end of period $ 1,186,417 $ 1,009,073 Supplemental disclosures of cash flow information: Cash payments for: Interest on deposits and borrowings $ 769,206 $ 891,336 Federal and state income taxes 34,099 48,252 Supplemental schedule of non-cash investing activities: Transfer of loans to other real estate owned, net $ 832 $ 8,059 Transfer of loans to loans held for sale, net 10,200 34,143 Lease right of use assets obtained in exchange for operating lease liabilities 22,866 15,429 See accompanying notes to consolidated financial statements. 9 VALLEY NATIONAL BANCORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note 1. Basis of Presentation The unaudited consolidated financial state ments of Valley include the accounts of the Bank and all other entities in which Valley has a controlling financial interest. All intercompany transactions and balances have been eliminated. The accounting and reporting policies of Valley conform to GAAP and general practices within the financial services industry. In accordance with GAAP, Valley does not consolidate statutory trusts established for the sole purpose of issuing trust preferred securities and related trust common securities. 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 June 30, 2025 and for all periods presented have been made. The results of operations for the three and six months ended June 30, 2025 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 GAAP and industry practice have been condensed or omitted pursuant to rules and regulations of the SEC. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in Valley’s Annual Report. Significant Estimates. In preparing the unaudited consolidated financial statements in conformit y with GAAP, management has made estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the consolidated statements of financial condition and results of operations for the periods indicated. Material estimates that require application of management’s most difficult, subjective or complex judgment and are particularly susceptible to change include: the allowance for credit losses, the evaluation of goodwill and other intangible assets for impairment, and income taxes. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the consolidated financial statements in the period they are deemed necessary. While management uses its best judgment, actual amounts or results could differ significantly from those estimates. The recent economic environment has increased and may continue to increase the degree of uncertainty inherent in these material estimates. Actual results may differ from those estimates. Also, future amounts and values could differ materially from those estimates due to changes in values and circumstances after the balance sheet date. On July 4, 2025, new federal legislation commonly known as the One Big Beautiful Bill Act (OBBBA) was enacted into law. The OBBBA extends or reinstates certain provisions of the 2017 Tax Cuts and Jobs Act, includes tax relief measures, modifies certain energy tax credits and sets various limits on tax deductions, among other key provisions. Valley is currently evaluating the provisions of the OBBBA, but it is not expected to have a material impact on Valley's consolidated financial statements. 10 Note 2. Earnings Per Common Share The following table shows the calculation of both basic and diluted earnings per common share for the three and six months ended June 30, 2025 and 2024: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (in thousands, except for share and per share data) Net income available to common shareholders $ 126,219 $ 66,316 $ 225,322 $ 158,477 Basic weighted average number of common shares outstanding 560,336,610 509,141,252 559,976,939 508,740,986 Plus: Common stock equivalents 1,975,720 1,197,250 3,454,451 1,696,973 Diluted weighted average number of common shares outstanding 562,312,330 510,338,502 563,431,390 510,437,959 Earnings per common share: Basic $ 0.23 $ 0.13 $ 0.40 $ 0.31 Diluted 0.22 0.13 0.40 0.31 Common stock equivalents represent the dilutive effect of additional common shares issuable upon the assumed vesting or exercise, if applicable, of RSUs and stock options to purchase Valley’s common shares. Stock options and RSUs with exercise and vesting prices that exceed the average market price 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. Pote ntial anti-dilutive weighted common shares totaled approximately 3.5 million and 6.9 million for the three months ended June 30, 2025 and 2024, respectively, and 798 thousand and 6.0 million for the six months ended June 30, 2025 and 2024, respectively. Note 3. Accumulated Other Comprehensive Loss The following tables present the after-tax changes in the balances of each component of accumulated other comprehensive loss for th e three and six months ended June 30, 2025 and 2024: Components of Accumulated Other Comprehensive Loss Total Accumulated Other Comprehensive Loss Unrealized Gains and Losses on AFS Securities Unrealized Gains and Losses on Derivatives Defined Benefit Pension and Postretirement Benefit Plans (in thousands) March 31, 2025 $ ( 106,686 ) $ 1,027 $ ( 22,593 ) $ ( 128,252 ) Other comprehensive income before reclassification 8,496 — — 8,496 Amounts reclassified to earnings — ( 221 ) 88 ( 133 ) Other comprehensive income (loss), net 8,496 ( 221 ) 88 8,363 June 30, 2025 $ ( 98,190 ) $ 806 $ ( 22,505 ) $ ( 119,889 ) March 31, 2024 $ ( 125,707 ) $ 1,892 $ ( 33,033 ) $ ( 156,848 ) Other comprehensive loss before reclassification ( 5,600 ) — — ( 5,600 ) Amounts reclassified to earnings 8 ( 210 ) 37 ( 165 ) Other comprehensive (loss) income, net ( 5,592 ) ( 210 ) 37 ( 5,765 ) June 30, 2024 $ ( 131,299 ) $ 1,682 $ ( 32,996 ) $ ( 162,613 ) 11 Components of Accumulated Other Comprehensive Loss Total Accumulated Other Comprehensive Loss Unrealized Gains and Losses on AFS Securities Unrealized Gains and Losses on Derivatives Defined Benefit Pension and Postretirement Benefit Plans (in thousands) December 31, 2024 $ ( 133,898 ) $ 1,245 $ ( 22,681 ) $ ( 155,334 ) Other comprehensive income before reclassification 35,708 — — 35,708 Amounts reclassified to earnings — ( 439 ) 176 ( 263 ) Other comprehensive income (loss), net 35,708 ( 439 ) 176 35,445 June 30, 2025 $ ( 98,190 ) $ 806 $ ( 22,505 ) $ ( 119,889 ) December 31, 2023 $ ( 115,502 ) $ 2,114 $ ( 33,068 ) $ ( 146,456 ) Other comprehensive loss before reclassification ( 15,805 ) — — ( 15,805 ) Amounts reclassified to earnings 8 ( 432 ) 72 ( 352 ) Other comprehensive (loss) income, net ( 15,797 ) ( 432 ) 72 ( 16,157 ) June 30, 2024 $ ( 131,299 ) $ 1,682 $ ( 32,996 ) $ ( 162,613 ) 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, 2025 and 2024: Amounts Reclassified from Accumulated Other Comprehensive Loss Three Months Ended June 30, Six Months Ended June 30, Components of Accumulated Other Comprehensive Loss 2025 2024 2025 2024 Income Statement Line Item (in thousands) Unrealized losses on AFS securities before tax $ — $ ( 11 ) $ — $ ( 11 ) (Losses) gains on securities transactions, net Tax effect — 3 — 3 Total net of tax — ( 8 ) — ( 8 ) Unrealized gains on derivatives (cash flow hedges) before tax $ 304 $ 299 $ 605 $ 597 Interest and fees on loans Tax effect ( 83 ) ( 89 ) ( 166 ) ( 165 ) Total net of tax 221 210 439 432 Defined benefit pension and postretirement benefit plans: Amortization of actuarial net loss ( 121 ) ( 50 ) ( 242 ) ( 99 ) Other non-interest expense Tax effect 33 13 66 27 Total net of tax ( 88 ) ( 37 ) ( 176 ) ( 72 ) Total reclassifications, net of tax $ 133 $ 165 $ 263 $ 352 Note 4. New Authoritative Accounting Guidance ASU No. 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses," requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. ASU No. 2024-03 does not change the expense captions an entity presents on the face of the income statement. Subsequently issued ASU No. 2025-01 amended the effective date of ASU No. 2024-03 to require all public business entities to adopt the new guidance for annual reporting periods beginning after December 15, 2026, and interim periods within fiscal 12 years beginning after December 15, 2027. Early adoption and retrospective application are permitted. Valley is currently evaluating the impact of ASU No. 2024-03 on its consolidated financial statements. Note 5. Fair Value Measurement of Assets and Liabilities 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). The three levels of the fair value hierarchy are described below: • Level 1 - Unadjusted exchange quoted prices in active markets for identical assets or liabilities, or identical liabilities traded as assets that the reporting entity has the ability to access at the measurement date. • Level 2 - Quoted prices in markets that are not active, or inputs that are observable either directly or indirectly (i.e., quoted prices on similar assets) for substantially the full term of the asset or liability. • Level 3 - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). 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 June 30, 2025 and December 31, 2024. 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). 13 June 30, 2025 Fair Value Measurements at Reporting Date Using: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Recurring fair value measurements: Assets Investment securities: Equity securities $ 23,468 $ 23,468 $ — $ — Equity securities at net asset value (NAV) 10,300 — — — Available for sale debt securities: U.S. Treasury securities 298,070 298,070 — — U.S. government agency securities 22,403 — 22,403 — Obligations of states and political subdivisions 184,277 — 184,277 — Residential mortgage-backed securities 3,188,813 — 3,188,813 — Corporate and other debt securities 202,642 — 202,642 — Total available for sale debt securities 3,896,205 298,070 3,598,135 — Loans held for sale (1) 9,146 — 9,146 — Other assets (2) 232,123 — 232,123 — Total assets $ 4,171,242 $ 321,538 $ 3,839,404 $ — Liabilities Other liabilities (2) $ 234,175 $ — $ 234,175 $ — Total liabilities $ 234,175 $ — $ 234,175 $ — Non-recurring fair value measurements: Non-performing loans held for sale (3) $ 18,950 $ — $ 18,950 $ — Collateral dependent loans 144,302 — — 144,302 Foreclosed assets (3) 4,686 — — 4,686 Total $ 167,938 $ — $ 18,950 $ 148,988 14 Fair Value Measurements at Reporting Date Using: December 31, 2024 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Recurring fair value measurements: Assets Investment securities: Equity securities $ 23,642 $ 23,642 $ — $ — Equity securities at net asset value (NAV) 11,000 — — — Available for sale debt securities: U.S. Treasury securities 291,549 291,549 — — U.S. government agency securities 22,543 — 22,543 — Obligations of states and political subdivisions 192,509 — 192,509 — Residential mortgage-backed securities 2,681,076 — 2,681,076 — Corporate and other debt securities 182,047 — 182,047 — Total available for sale debt securities 3,369,724 291,549 3,078,175 — Loans held for sale (1) 16,931 — 16,931 — Other assets (2) 444,263 — 444,263 — Total assets $ 3,865,560 $ 315,191 $ 3,539,369 $ — Liabilities Other liabilities (2) $ 454,200 $ — $ 454,200 $ — Total liabilities $ 454,200 $ — $ 454,200 $ — Non-recurring fair value measurements: Non-performing loan held for sale (3) $ 8,750 $ — $ 8,750 $ — Collateral dependent loans 139,424 — — 139,424 Foreclosed assets (3) 13,852 — — 13,852 Total $ 162,026 $ — $ 8,750 $ 153,276 (1) Represents residential mortgage loans originated for sale that are carried at fair value and had contractual unpaid principal balances totaling $ 8.9 million and $ 16.8 million at June 30, 2025 and December 31, 2024, respectively. (2) Derivative financial instruments are included in this category. (3) Reported at lower of cost or fair value . Assets and Liabilities Measured at Fair Value on a Recurring Basis The following valuation techniques were used for financial instruments measured at fair value on a recurring basis. All the valuation techniques described below apply to the unpaid principal balance, excluding any accrued interest or dividends at the measurement date. Interest income and expense are recorded within the consolidated statements of income depending on the nature of the instrument using the effective interest method based on acquired discount or premium. Equity securities . The equity securities consisted of two publicly traded mutual funds, CRA inves tments and a publicly traded financial technology company. These investments are reported at fair value utilizing Level 1 inputs. Equity securities at NAV . Valley also has privately held CRA funds and investments in limited liability companies and partnerships at fair value measured at NAV using the most recently available financial information from the investee. Certain equity investments without readily determinable fair values, excluded from fair value hierarchy levels in the table above, are measured at NAV per share (or its equivalent) as a practical expedient. 15 Available for sale debt securities. U.S. Treasury securities are reported at fair value utilizing Level 1 inputs. The majority of other investment securities are reported at fair value utilizing Level 2 inputs. The prices for these instruments are obtained through an independent pricing service or dealer market participants with whom Valley has historically transacted both purchases and sales of investment securities. Prices obtained from these sources include prices derived from market quotations and matrix pricing. The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the bond’s terms and conditions, among other things. 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. In addition, Valley reviews the volume and level of activity for a ll AFS debt s ecurities and attempts to identify transactions which may not be orderly or reflective of a significant level of activity and volume. Loans held for sale. Residential mortgage loans originated for sale are reported at fair value using Level 2 inputs. The fair values were calculated utilizing quoted prices for similar assets in active markets. 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 June 30, 2025 and December 31, 2024 based on the short duration these assets were held and their credit quality. Derivatives. 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 SOFR curve, at June 30, 2025 and December 31, 2024. 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, 2025 and December 31, 2024), is determined based on the current market prices for similar instruments. The fair value of a credit default swap related to a portion of Valley's automobile loan portfolio is based on estimated discounted cash flows that incorporate market data for auto credit loss forecasts and anticipated cash outflows for the instrument's premium payments. The fair value 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 June 30, 2025 and December 31, 2024. See Note 12 for additional details on Valley's derivatives. 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 commercial real estate loans held for sale . During 2023, Valley transferred a non-performing construction loan totaling $ 10.0 million, net of $ 4.2 million charge-offs, to the allowance for loan losses, to loans held for sale. 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 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 in the bidding process. During 2024, an additional $ 1.2 million write-down was recorded to earnings to reflect the loan's current estimated fair value of $ 8.8 million at December 31, 2024 and June 30, 2025. During the six months ended June 30, 2025, Valley transferred a non-performing construction loan totaling $ 10.2 million, net of $ 638 thousand charge-offs to the allowance for loan losses, to loans held for sale. The fair value of the loan was determined using Level 2 inputs, including bids to purchase from multiple third-parties. Fair value was determined based on a non-binding sale agreement selected by Valley in the bidding process. 16 Collateral dependent loans . Collateral dependent loans are loans where foreclosure of the collateral is probable, or where the borrower is experiencing financial difficulty and substantially all the repayment is expected from the sale of collateral. Collateral dependent loans are reported at the fair value of the underlying collateral when the fair value is lower than the recorded investment in the loan. Collateral values are estimated using Level 3 inputs, consisting of individual third-party appraisals that may be adjusted based on certain discounting criteria. Certain real estate appraisals may be discounted based on specific market data by location and property type. At June 30, 2025, 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. Collateral dependent loans with a total amortized cost of $ 199.7 million (including taxi medallion loans totaling $ 48.6 million), were reduced by specific allowance for loan loss allocations totaling $ 55.4 million to a reported total net carrying amount of $ 144.3 million at June 30, 2025. Foreclosed assets . Certain foreclosed assets (consisting of other real estate owned and other repossessed assets included in other assets), upon initial recognition and transfer from loans, are re-measured and reported at fair value using Level 3 inputs, consisting of a third-party appraisal less estimated cost to sell. When an asset is acquired, the excess of the loan balance over fair value, less estimated selling costs, is charged to the allowance for loan losses. If further declines in the estimated fair value of an asset occur, the a sset is re-measured and reported at fair value through a write-down recorded in non-interest expense. The re-measurement of foreclosed assets at fair value subsequent to their initial recognition resulted in $ 2.9 million of losses for the three and six months ended June 30, 2025 included in non-interest expense and related to one other real estate owned property. There were no write-downs of foreclosed assets during three and six months ended June 30, 2024. There were no adjustments to the appraisals of foreclosed assets at June 30, 2025 and December 31, 2024. Other Fair Value Disclosures ASC Topic 825, “Financial Instruments,” requires disclosure of the fair value of financial assets and financial liabilities, including those financial assets and financial liabilities that are not measured and reported at fair value on a recurring basis or non-recurring basis. The fair value estimates presented in the following table were based on pertinent market data and relevant information on the financial instruments available as of the valuation date. These estimates do not reflect any premium or discount that could result from offering for sale at one time the entire portfolio of financial instruments. Because no market exists for a portion of the financial instruments, fair value estimates may be based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Fair value estimates are based on existing balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. For instance, Valley has certain fee-generating business lines (e.g., its mortgage servicing operations or Wealth Management reporting unit) that were not considered in these estimates since these activities are not financial instruments. 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. 17 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, 2025 and December 31, 2024 were as follows: Fair Value Hierarchy June 30, 2025 December 31, 2024 Carrying Amount Fair Value Carrying Amount Fair Value (in thousands) Financial assets Cash and due from banks Level 1 $ 440,870 $ 440,870 $ 411,412 $ 411,412 Interest bearing deposits with banks Level 1 745,547 745,547 1,478,713 1,478,713 Equity securities (1) Level 3 43,640 43,640 36,871 36,871 Held to maturity debt securities: U.S. Treasury securities Level 1 25,095 25,079 25,480 25,461 U.S. government agency securities Level 2 297,057 253,739 301,315 252,302 Obligations of states and political subdivisions Level 2 358,377 328,494 372,489 346,361 Residential mortgage-backed securities Level 2 2,731,797 2,370,561 2,710,642 2,292,148 Trust preferred securities Level 2 36,092 29,728 36,081 29,145 Corporate and other debt securities Level 2 83,143 80,800 86,213 82,867 Total held to maturity debt securities (2) 3,531,561 3,088,401 3,532,220 3,028,284 Net loans Level 3 48,811,920 47,085,699 48,240,861 46,634,654 Accrued interest receivable Level 1 238,278 238,278 239,941 239,941 FRB and FHLB stock (3) Level 2 344,052 344,052 328,497 328,497 Financial liabilities Deposits without stated maturities Level 1 37,838,403 37,838,403 37,733,313 37,733,313 Deposits with stated maturities Level 2 12,886,881 12,929,115 12,342,544 12,363,365 Short-term borrowings Level 2 162,244 159,081 72,718 68,032 Long-term borrowings Level 2 2,903,091 2,874,547 3,174,155 3,109,622 Junior subordinated debentures issued to capital trusts Level 2 57,629 53,054 57,455 54,957 Accrued interest payable (4) Level 1 118,608 118,608 150,564 150,564 (1) Represents equity securities without a readily determinable fair value, which are measured based on the price at which the investment was acquired plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments. Total changes in the valuation of equity securities were immaterial for the six months ended June 30, 2025 and the year ended December 31, 2024, respectively. (2) The carrying amount is presented gross without the allowance for credit losses. (3) Included in other assets. (4) Included in accrued expenses and other liabilities. Note 6. Investment Securities Equity Securities Equity securities totaled $ 77.4 million and $ 71.5 million at June 30, 2025 and December 31, 2024, respectively. See Note 5 for further details on equity securities. 18 Available for Sale Debt Securities The amortized cost, gross unrealized gains and losses, and fair value of AFS debt securities at June 30, 2025 and December 31, 2024 were as follows: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (in thousands) June 30, 2025 U.S. Treasury securities $ 322,493 $ — $ ( 24,423 ) $ 298,070 U.S. government agency securities 23,849 25 ( 1,471 ) 22,403 Obligations of states and political subdivisions: Obligations of states and state agencies 45,650 — ( 836 ) 44,814 Municipal bonds 180,577 — ( 41,114 ) 139,463 Total obligations of states and political subdivisions 226,227 — ( 41,950 ) 184,277 Residential mortgage-backed securities 3,243,118 25,456 ( 79,761 ) 3,188,813 Corporate and other debt securities 214,410 489 ( 12,257 ) 202,642 Total $ 4,030,097 $ 25,970 $ ( 159,862 ) $ 3,896,205 December 31, 2024 U.S. Treasury securities $ 319,551 $ — $ ( 28,002 ) $ 291,549 U.S. government agency securities 24,636 20 ( 2,113 ) 22,543 Obligations of states and political subdivisions: Obligations of states and state agencies 46,211 — ( 682 ) 45,529 Municipal bonds 179,284 — ( 32,304 ) 146,980 Total obligations of states and political subdivisions 225,495 — ( 32,986 ) 192,509 Residential mortgage-backed securities 2,784,895 3,796 ( 107,615 ) 2,681,076 Corporate and other debt securities 197,696 247 ( 15,896 ) 182,047 Total $ 3,552,273 $ 4,063 $ ( 186,612 ) $ 3,369,724 Accrued interest on investments , which is excluded from the amortized cost of AFS debt securities, totaled $ 15.4 million and $ 13.1 million at June 30, 2025 and December 31, 2024, respectively, and is presented within total accrued interest receivable on the consolidated statements of financial condition. 19 The age of unrealized losses and fair value of the related AFS debt securities at June 30, 2025 and December 31, 2024 were as follows: Less than 12 Months More than 12 Months Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses (in thousands) June 30, 2025 U.S. Treasury securities $ — $ — $ 298,070 $ ( 24,423 ) $ 298,070 $ ( 24,423 ) U.S. government agency securities — — 21,179 ( 1,471 ) 21,179 ( 1,471 ) Obligations of states and political subdivisions: Obligations of states and state agencies — — 5,744 ( 836 ) 5,744 ( 836 ) Municipal bonds — — 131,768 ( 41,114 ) 131,768 ( 41,114 ) Total obligations of states and political subdivisions — — 137,512 ( 41,950 ) 137,512 ( 41,950 ) Residential mortgage-backed securities 674,361 ( 7,204 ) 505,120 ( 72,557 ) 1,179,481 ( 79,761 ) Corporate and other debt securities 4,628 ( 372 ) 166,024 ( 11,885 ) 170,652 ( 12,257 ) Total $ 678,989 $ ( 7,576 ) $ 1,127,905 $ ( 152,286 ) $ 1,806,894 $ ( 159,862 ) December 31, 2024 U.S. Treasury securities $ — $ — $ 291,549 $ ( 28,002 ) $ 291,549 $ ( 28,002 ) U.S. government agency securities — — 21,281 ( 2,113 ) 21,281 ( 2,113 ) Obligations of states and political subdivisions: Obligations of states and state agencies — — 6,208 ( 682 ) 6,208 ( 682 ) Municipal bonds — — 139,216 ( 32,304 ) 139,216 ( 32,304 ) Total obligations of states and political subdivisions — — 145,424 ( 32,986 ) 145,424 ( 32,986 ) Residential mortgage-backed securities 1,483,442 ( 22,242 ) 501,858 ( 85,373 ) 1,985,300 ( 107,615 ) Corporate and other debt securities — — 166,800 ( 15,896 ) 166,800 ( 15,896 ) Total $ 1,483,442 $ ( 22,242 ) $ 1,126,912 $ ( 164,370 ) $ 2,610,354 $ ( 186,612 ) Within the AFS debt securities portfolio, the total number of security positions in an unrealized loss position was 661 and 726 at June 30, 2025 and December 31, 2024, respectively. As of June 30, 2025, the fair value of AFS securities that were pledged to secure public deposits, repurchase agreements, lines of credit, and for other purposes required by law, was $ 1.0 billion. 20 Contractual Maturities The contractual maturities of AFS debt securities at June 30, 2025 are set forth in the following table. Contractual maturities may differ from actual maturities as borrowers may have the right to call or repay obligations with or without call or prepayment penalties. Residential mortgage-backed securities are not included in the maturity categories in the following maturity summary as actual maturities may differ from contractual maturities because the underlying mortgages may be called or prepaid without penalties. June 30, 2025 Amortized Cost Fair Value (in thousands) Due in one year $ 179,139 $ 177,670 Due after one year through five years 140,847 137,361 Due after five years through ten years 175,717 162,664 Due after ten years 291,276 229,697 Residential mortgage-backed securities 3,243,118 3,188,813 Total $ 4,030,097 $ 3,896,205 The weighted average remaining expected life for AFS residential mortgage-backed securities was 8.39 years at June 30, 2025. Impairment Analysis of Available For Sale Debt Securities Valley's AFS debt securities portfolio includes corporate bonds and revenue bonds, among other securities. These types of securities may pose a higher risk of future impairment charges by Valley due to a variety of factors such as the unpredictable nature of the U.S. economy and its potential negative effect on the future performance of the security issuers. AFS debt securities in unrealized loss positions are evaluated for impairment related to credit losses on a quarterly basis. Valley also evaluated AFS debt securities that were in an unrealized loss position as of June 30, 2025 included in the tables 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. Based on a comparison of the present value of expected cash flows to the amortized cost, th ere was no impairment recognized during the three and six months ended June 30, 2025 and 2024 . Valley does not intend to sell any of its AFS 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 AFS debt securities were past due as of June 30, 2025. As a result, there was no allowance for credit losses f or AFS debt securities at June 30, 2025 and December 31, 2024. 21 Held to Maturity Debt Securities The amortized cost, gross unrealized gains and losses and fair value of HTM debt securities at June 30, 2025 and December 31, 2024 were as follows: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Allowance for Credit Losses Net Carrying Value (in thousands) June 30, 2025 U.S. Treasury securities $ 25,095 $ — $ ( 16 ) $ 25,079 $ — $ 25,095 U.S. government agency securities 297,057 6 ( 43,324 ) 253,739 — 297,057 Obligations of states and political subdivisions: Obligations of states and state agencies 64,729 167 ( 4,457 ) 60,439 1 64,728 Municipal bonds 293,648 13 ( 25,606 ) 268,055 74 293,574 Total obligations of states and political subdivisions 358,377 180 ( 30,063 ) 328,494 75 358,302 Residential mortgage-backed securities 2,731,797 6,564 ( 367,800 ) 2,370,561 — 2,731,797 Trust preferred securities 36,092 — ( 6,364 ) 29,728 408 35,684 Corporate and other debt securities 83,143 1 ( 2,344 ) 80,800 154 82,989 Total $ 3,531,561 $ 6,751 $ ( 449,911 ) $ 3,088,401 $ 637 $ 3,530,924 December 31, 2024 U.S. Treasury securities $ 25,480 $ — $ ( 19 ) $ 25,461 $ — $ 25,480 U.S. government agency securities 301,315 — ( 49,013 ) 252,302 — 301,315 Obligations of states and political subdivisions: Obligations of states and state agencies 68,025 — ( 5,335 ) 62,690 2 68,023 Municipal bonds 304,464 9 ( 20,802 ) 283,671 48 304,416 Total obligations of states and political subdivisions 372,489 9 ( 26,137 ) 346,361 50 372,439 Residential mortgage-backed securities 2,710,642 2,088 ( 420,582 ) 2,292,148 — 2,710,642 Trust preferred securities 36,081 — ( 6,936 ) 29,145 414 35,667 Corporate and other debt securities 86,213 10 ( 3,356 ) 82,867 183 86,030 Total $ 3,532,220 $ 2,107 $ ( 506,043 ) $ 3,028,284 $ 647 $ 3,531,573 Accrued interest on investments , which is excluded from the amortized cost of HTM debt securities, totaled $ 13.0 million at both June 30, 2025 and December 31, 2024, and is presented within total accrued interest receivable on the consolidated statements of financial condition. HTM debt securities are carried net of an allowance for credit losses (as shown in the table above). 22 The age of unrealized losses and fair value of related HTM debt securities at June 30, 2025 and December 31, 2024 were as follows: Less than 12 Months More than 12 Months Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses (in thousands) June 30, 2025 U.S. Treasury securities $ 25,079 $ ( 16 ) $ — $ — $ 25,079 $ ( 16 ) U.S. government agency securities — — 234,270 ( 43,324 ) 234,270 ( 43,324 ) Obligations of states and political subdivisions: Obligations of states and state agencies 5,762 ( 191 ) 41,766 ( 4,266 ) 47,528 ( 4,457 ) Municipal bonds 27,598 ( 444 ) 186,299 ( 25,162 ) 213,897 ( 25,606 ) Total obligations of states and political subdivisions 33,360 ( 635 ) 228,065 ( 29,428 ) 261,425 ( 30,063 ) Residential mortgage-backed securities 59,062 ( 859 ) 1,876,157 ( 366,941 ) 1,935,219 ( 367,800 ) Trust preferred securities — — 29,728 ( 6,364 ) 29,728 ( 6,364 ) Corporate and other debt securities 17,960 ( 40 ) 57,838 ( 2,304 ) 75,798 ( 2,344 ) Total $ 135,461 $ ( 1,550 ) $ 2,426,058 $ ( 448,361 ) $ 2,561,519 $ ( 449,911 ) December 31, 2024 U.S. Treasury securities $ 25,461 $ ( 19 ) $ — $ — $ 25,461 $ ( 19 ) U.S. government agency securities 22,621 ( 75 ) 229,143 ( 48,938 ) 251,764 ( 49,013 ) Obligations of states and political subdivisions: Obligations of states and state agencies 20,632 ( 517 ) 42,058 ( 4,818 ) 62,690 ( 5,335 ) Municipal bonds 36,766 ( 440 ) 210,723 ( 20,362 ) 247,489 ( 20,802 ) Total obligations of states and political subdivisions 57,398 ( 957 ) 252,781 ( 25,180 ) 310,179 ( 26,137 ) Residential mortgage-backed securities 216,651 ( 2,687 ) 1,917,644 ( 417,895 ) 2,134,295 ( 420,582 ) Trust preferred securities — — 29,145 ( 6,936 ) 29,145 ( 6,936 ) Corporate and other debt securities 5,977 ( 23 ) 63,879 ( 3,333 ) 69,856 ( 3,356 ) Total $ 328,108 $ ( 3,761 ) $ 2,492,592 $ ( 502,282 ) $ 2,820,700 $ ( 506,043 ) Within the HTM securities portfolio, the total number of security positions in an unrealized loss position was 737 and 798 at June 30, 2025 and December 31, 2024, respectively. As of June 30, 2025, the fair value of HTM debt securities that were pledged to secure public deposits, repurchase agreements, lines of credit, and for other purposes required by law was $ 1.2 billion. 23 Contractual Maturities The contractual maturities of investments in HTM debt securities at June 30, 2025 is set forth in the table below. Contractual maturities may differ from actual maturities as borrowers may have the right to call or repay obligations with or without call or prepayment penalties. Residential mortgage-backed securities are not included in the maturity categories in the following maturity summary as actual maturities may differ from contractual maturities because the underlying mortgages may be called or prepaid without penalties. June 30, 2025 Amortized Cost Fair Value (in thousands) Due in one year $ 63,269 $ 63,061 Due after one year through five years 49,356 48,874 Due after five years through ten years 164,449 156,160 Due after ten years 522,690 449,745 Residential mortgage-backed securities 2,731,797 2,370,561 Total $ 3,531,561 $ 3,088,401 The weighted-average remaining expected life for HTM residential mortgage-backed securitie s was 9.13 years at June 30, 2025. 24 Credit Quality Indicators Valley monitors the credit quality of the HTM debt securities utilizing the most c urrent credit ratings from external rating agencies. The following table summarizes the amortized cost of HTM debt securities by external credit rating at June 30, 2025 and December 31, 2024. AAA/AA/A Rated BBB rated Non-rated Total (in thousands) June 30, 2025 U.S. Treasury securities $ 25,095 $ — $ — $ 25,095 U.S. government agency securities 297,057 — — 297,057 Obligations of states and political subdivisions: Obligations of states and state agencies 49,610 — 15,119 64,729 Municipal bonds 255,035 — 38,613 293,648 Total obligations of states and political subdivisions 304,645 — 53,732 358,377 Residential mortgage-backed securities 2,731,797 — — 2,731,797 Trust preferred securities — — 36,092 36,092 Corporate and other debt securities — 6,000 77,143 83,143 Total $ 3,358,594 $ 6,000 $ 166,967 $ 3,531,561 December 31, 2024 U.S. Treasury securities $ 25,480 $ — $ — $ 25,480 U.S. government agency securities 301,315 — — 301,315 Obligations of states and political subdivisions: Obligations of states and state agencies 52,770 — 15,255 68,025 Municipal bonds 277,921 — 26,543 304,464 Total obligations of states and political subdivisions 330,691 — 41,798 372,489 Residential mortgage-backed securities 2,710,642 — — 2,710,642 Trust preferred securities — — 36,081 36,081 Corporate and other debt securities — 6,000 80,213 86,213 Total $ 3,368,128 $ 6,000 $ 158,092 $ 3,532,220 Obligations of states and political subdivisions include municipal bonds and revenue bonds issued by various municipal corporations. At June 30, 2025, most of the obligations of states and political subdivisions were rated investment grade and a large portion of the “non-rated” category included municipal bonds secured by Ginnie Mae securities. Trust preferred securities consist of non-rated single-issuer securities issued by bank holding companies. Corporate bonds consist of debt primarily issued by banks. Allowance for Credit Losses for Held to Maturity Debt Securities Valley has zero loss expectation for certain securities within the HTM portfolio, and therefore it is not required to estimate an allowance for credit losses related to these securities under the CECL standard. After an evaluation of qualitative factors, Valley identified the following security types which it believes qualify for this exclusion: U.S. Treasury securities, U.S. government agency securities, residential mortgage-backed securities issued by Ginnie Mae, Fannie Mae and Freddie Mac, and collateralized municipal bonds. To measure the expected credit losses on HTM debt securities that have loss expectations, Valley estimates the expected credit losses using a discounted cash flow model developed by a third-party. 25 The following table details the activity in the allowance for credit losses for HTM securities for the three and six months ended June 30, 2025 and 2024: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (in thousands) Beginning balance $ 633 $ 1,131 $ 647 $ 1,205 Provision (credit) for credit losses 4 ( 41 ) ( 10 ) ( 115 ) Ending balance $ 637 $ 1,090 $ 637 $ 1,090 There were no net charge-offs of HTM debt securities in the respective periods presented in the table above. Note 7. Loans and Allowance for Credit Losses for Loans The details of the loan portfolio as of June 30, 2025 and December 31, 2024 were as follows: June 30, 2025 December 31, 2024 (in thousands) Loans: Commercial and industrial $ 10,870,036 $ 9,931,400 Commercial real estate: Commercial real estate 25,971,061 26,530,225 Construction 2,854,859 3,114,733 Total commercial real estate loans 28,825,920 29,644,958 Residential mortgage 5,709,971 5,632,516 Consumer: Home equity 634,553 604,433 Automobile 2,178,841 1,901,065 Other consumer 1,172,099 1,085,339 Total consumer loans 3,985,493 3,590,837 Total loans $ 49,391,420 $ 48,799,711 Total loans include net unearned discounts and deferred loan fees of $ 21.5 million and $ 45.3 million at June 30, 2025 and December 31, 2024, respectively. Accrued interest on loans , which is excluded from the amortized cost of loans held for investment, totaled $ 206.2 million and $ 208.9 million at June 30, 2025 and December 31, 2024, respectively, and is presented within total accrued interest receivable on the consolidated statements of financial condition. Loans Portfolio Sales and Transfers to Loans Held for Sale Valley sells residential mortgage loans originated for sale (at fair value) primarily to Fannie Mae and Freddie Mac in the normal course of business. Under certain circumstances, Valley may decide to sell loans that were not originated with the intent to sell. During the six months ended June 30, 2025, Valley transferred a non-performing construction loan totaling $ 10.2 million, net of $ 638 thousand charge-offs, from the held for investment loan portfolio to loans held for sale. See Note 5 for further details. During the six months ended June 30, 2024, Valley completed the sale of its commercial premium finance lending business for $ 96.8 million. This asset sale included $ 95.5 million of assets, mainly consisting of $ 93.6 million of loans, and $ 2.8 million of related liabilities. The transaction generated a $ 3.6 million net gain for the six months ended June 30, 2024. 26 There w ere no other transfers or sales of loans from the held for investment portfolio during the three and six months ended June 30, 2025 and 2024. Credit Risk Management Valley adheres to a credit policy designed to minimize credit risk while generating the maximum income given the level of risk appetite. Management reviews and approves these policies and procedures on a regular basis with subsequent approval by the Board 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. Loan portfolio diversification is an important factor utilized by Valley to manage its risk across business sectors and through cyclical economic circumstances. Additionally, Valley does not accept crypto assets as loan collateral for any of its loan portfolio classes. See Valley’s Annual Report for further details. Credit Quality The following table presents past due, current, and non-accrual loans without an allowance for loan losses by loan portfolio class at June 30, 2025 and December 31, 2024: Past Due and Non-Accrual Loans 30-59 Days Past Due Loans 60-89 Days Past Due Loans 90 Days or More Past Due Loans Non-Accrual Loans Total Past Due Loans Current Loans Total Loans Non-Accrual Loans Without Allowance for Loan Losses (in thousands) June 30, 2025 Commercial and industrial $ 10,451 $ 1,095 $ — $ 90,973 $ 102,519 $ 10,767,517 $ 10,870,036 $ 19,512 Commercial real estate: Commercial real estate 42,884 60,601 — 193,604 297,089 25,673,972 25,971,061 107,756 Construction 35,000 — — 24,068 59,068 2,795,791 2,854,859 — Total commercial real estate loans 77,884 60,601 — 217,672 356,157 28,469,763 28,825,920 107,756 Residential mortgage 21,744 7,627 2,062 41,099 72,532 5,637,439 5,709,971 29,064 Consumer loans: Home equity 1,893 2,499 — 4,391 8,783 625,770 634,553 1,323 Automobile 9,710 1,113 439 209 11,471 2,167,370 2,178,841 — Other consumer 1,275 389 420 15 2,099 1,170,000 1,172,099 — Total consumer loans 12,878 4,001 859 4,615 22,353 3,963,140 3,985,493 1,323 Total $ 122,957 $ 73,324 $ 2,921 $ 354,359 $ 553,561 $ 48,837,859 $ 49,391,420 $ 157,655 27 Past Due and Non-Accrual Loans 30-59 Days Past Due Loans 60-89 Days Past Due Loans 90 Days or More Past Due Loans Non-Accrual Loans Total Past Due Loans Current Loans Total Loans Non-Accrual Loans Without Allowance for Loan Losses (in thousands) December 31, 2024 Commercial and industrial $ 2,389 $ 1,007 $ 1,307 $ 136,675 $ 141,378 $ 9,790,022 $ 9,931,400 $ 15,947 Commercial real estate: Commercial real estate 20,902 24,903 — 157,231 203,036 26,327,189 26,530,225 91,095 Construction — — — 24,591 24,591 3,090,142 3,114,733 5,002 Total commercial real estate loans 20,902 24,903 — 181,822 227,627 29,417,331 29,644,958 96,097 Residential mortgage 21,295 5,773 3,533 36,786 67,387 5,565,129 5,632,516 23,543 Consumer loans: Home equity 1,651 181 — 3,961 5,793 598,640 604,433 1,341 Automobile 8,583 1,346 407 230 10,566 1,890,499 1,901,065 — Other consumer 2,318 2,957 642 24 5,941 1,079,398 1,085,339 — Total consumer loans 12,552 4,484 1,049 4,215 22,300 3,568,537 3,590,837 1,341 Total $ 57,138 $ 36,167 $ 5,889 $ 359,498 $ 458,692 $ 48,341,019 $ 48,799,711 $ 136,928 Credit quality indicators. Valley utilizes an internal loan classification system as a means of reporting problem loans within commercial and industrial, commercial real estate, and construction loan portfolio classes. Under Valley’s internal risk rating system, loan relationships could be classified as “Pass,” “Special Mention,” “Substandard,” “Doubtful,” and “Loss.” Substandard loans include loans that exhibit well-defined weakness and are characterized by the distinct possibility that Valley will sustain some loss if the deficiencies are not corrected. Loans classified as Doubtful have all the weaknesses inherent in those classified as Substandard with the added characteristic that the weaknesses present make collection or liquidation in full, based on currently existing facts, conditions and values, highly questionable and improbable. Loans classified as Loss are those considered uncollectible with insignificant value and are charged-off immediately to the allowance for loan losses and, therefore, not presented in the table below. Loans that do not currently pose a sufficient risk to warrant classification in one of the aforementioned categories but pose weaknesses that deserve management’s close attention are deemed Special Mention. Pass rated loans do not currently pose any identified risk and can range from the highest to average quality, depending on the degree of potential risk. Risk ratings are updated any time the situation warrants. 28 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, 2025 and December 31, 2024, as well as the gross loan charge-offs by year of origination for the six months ended June 30, 2025 and for the year ended December 31, 2024: Term Loans Amortized Cost Basis by Origination Year June 30, 2025 2025 2024 2023 2022 2021 Prior to 2021 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Total (in thousands) Commercial and industrial Risk Rating: Pass $ 899,962 $ 1,579,211 $ 784,023 $ 594,156 $ 378,487 $ 602,119 $ 5,322,292 $ 8,655 $ 10,168,905 Special Mention 1,116 1,566 12,373 8,970 20,015 5,316 169,498 4,699 223,553 Substandard — 26,363 23,749 62,235 3,787 63,259 218,750 20,761 418,904 Doubtful — — 6,253 2 321 49,460 2,638 — 58,674 Total commercial and industrial $ 901,078 $ 1,607,140 $ 826,398 $ 665,363 $ 402,610 $ 720,154 $ 5,713,178 $ 34,115 $ 10,870,036 Commercial real estate Risk Rating: Pass $ 906,097 $ 2,046,206 $ 2,631,836 $ 5,034,673 $ 3,508,472 $ 7,948,426 $ 493,466 $ 53,795 $ 22,622,971 Special Mention 1,783 131,233 262,912 291,603 149,396 251,288 150,586 — 1,238,801 Substandard — 66,645 203,098 413,659 399,249 906,389 77,073 67 2,066,180 Doubtful — — 3,060 — 29,483 10,566 — — 43,109 Total commercial real estate $ 907,880 $ 2,244,084 $ 3,100,906 $ 5,739,935 $ 4,086,600 $ 9,116,669 $ 721,125 $ 53,862 $ 25,971,061 Construction Risk Rating: Pass $ 283,613 $ 565,391 $ 447,756 $ 322,573 $ 64,401 $ 53,919 $ 775,127 $ 17,671 $ 2,530,451 Special Mention — 10,895 21,510 1,742 23,047 1,969 96,667 7,048 162,878 Substandard — 571 33,539 8,950 6,228 8,529 70,770 32,943 161,530 Total construction $ 283,613 $ 576,857 $ 502,805 $ 333,265 $ 93,676 $ 64,417 $ 942,564 $ 57,662 $ 2,854,859 Gross loan charge-offs $ — $ 6,503 $ 3,328 $ 4,109 $ 13,657 $ 15,654 $ 23,450 $ 14,990 $ 81,691 29 Term Loans Amortized Cost Basis by Origination Year December 31, 2024 2024 2023 2022 2021 2020 Prior to 2020 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Total (in thousands) Commercial and industrial Risk Rating: Pass $ 1,769,585 $ 828,087 $ 703,962 $ 476,091 $ 246,992 $ 392,834 $ 4,804,095 $ 6,006 $ 9,227,652 Special Mention 30,755 3,553 59,434 11,646 270 72,514 147,254 10,762 336,188 Substandard 24,613 13,479 9,415 4,296 2,813 7,382 201,053 39,011 302,062 Doubtful — 8,911 4 928 — 52,064 3,591 — 65,498 Total commercial and industrial $ 1,824,953 $ 854,030 $ 772,815 $ 492,961 $ 250,075 $ 524,794 $ 5,155,993 $ 55,779 $ 9,931,400 Commercial real estate Risk Rating: Pass $ 2,097,314 $ 2,941,270 $ 5,310,807 $ 3,883,333 $ 2,302,480 $ 6,086,608 $ 597,266 $ 78,621 $ 23,297,699 Special Mention 156,394 380,852 289,669 192,614 55,739 327,732 141,164 — 1,544,164 Substandard 84,410 107,944 387,638 288,906 236,927 520,858 11,167 — 1,637,850 Doubtful — 3,060 — 35,756 9,813 1,883 — — 50,512 Total commercial real estate $ 2,338,118 $ 3,433,126 $ 5,988,114 $ 4,400,609 $ 2,604,959 $ 6,937,081 $ 749,597 $ 78,621 $ 26,530,225 Construction Risk Rating: Pass $ 545,597 $ 680,260 $ 334,899 $ 92,765 $ 17,955 $ 45,161 $ 1,224,698 $ 58,644 $ 2,999,979 Special Mention 13,278 — 664 5,069 — 2,504 16,691 — 38,206 Substandard 9,835 — 8,950 4,942 — — 43,474 — 67,201 Doubtful — — 2,074 — 7,273 — — — 9,347 Total construction $ 568,710 $ 680,260 $ 346,587 $ 102,776 $ 25,228 $ 47,665 $ 1,284,863 $ 58,644 $ 3,114,733 Gross loan charge-offs $ 706 $ 31,809 $ 7,523 $ 44,610 $ 66,632 $ 49,436 $ 3,930 $ 2,148 $ 206,794 30 For residential mortgages, home equity, automobile and other consumer loan portfolio classes, Valley 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 June 30, 2025 and December 31, 2024, as well as the gross loan charge-offs by year of origination for the six months ended June 30, 2025 and for the year ended December 31, 2024: Term Loans Amortized Cost Basis by Origination Year June 30, 2025 2025 2024 2023 2022 2021 Prior to 2021 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Total (in thousands) Residential mortgage Performing $ 248,495 $ 404,738 $ 405,835 $ 1,264,594 $ 1,385,458 $ 1,899,165 $ 78,028 $ — $ 5,686,313 90 days or more past due — 316 778 5,731 730 15,422 — 681 23,658 Total residential mortgage $ 248,495 $ 405,054 $ 406,613 $ 1,270,325 $ 1,386,188 $ 1,914,587 $ 78,028 $ 681 $ 5,709,971 Consumer loans Home equity Performing $ 14,196 $ 22,375 $ 27,170 $ 37,519 $ 9,579 $ 52,232 $ 462,203 $ 7,758 $ 633,032 90 days or more past due — — 3 133 1 1,098 — 286 1,521 Total home equity 14,196 22,375 27,173 37,652 9,580 53,330 462,203 8,044 634,553 Automobile Performing $ 673,088 $ 713,485 $ 275,710 $ 281,523 $ 150,135 $ 84,287 $ — $ — $ 2,178,228 90 days or more past due — 161 162 96 47 147 — — 613 Total automobile 673,088 713,646 275,872 281,619 150,182 84,434 — — 2,178,841 Other consumer Performing $ 5,634 $ 11,650 $ 19,464 $ 14,006 $ 4,954 $ 60,437 $ 1,037,349 $ 18,225 $ 1,171,719 90 days or more past due 5 — 25 1 — — — 349 380 Total other consumer 5,639 11,650 19,489 14,007 4,954 60,437 1,037,349 18,574 1,172,099 Total consumer $ 692,923 $ 747,671 $ 322,534 $ 333,278 $ 164,716 $ 198,201 $ 1,499,552 $ 26,618 $ 3,985,493 Gross loan charge-offs $ — $ 1,161 $ 626 $ 570 $ 273 $ 1,686 $ — $ 83 $ 4,399 31 Term Loans Amortized Cost Basis by Origination Year December 31, 2024 2024 2023 2022 2021 2020 Prior to 2020 Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Total (in thousands) Residential mortgage Performing $ 428,138 $ 413,528 $ 1,282,524 $ 1,420,835 $ 494,430 $ 1,490,512 $ 75,479 $ 954 $ 5,606,400 90 days or more past due 530 771 1,030 1,533 5,286 16,285 — 681 26,116 Total residential mortgage $ 428,668 $ 414,299 $ 1,283,554 $ 1,422,368 $ 499,716 $ 1,506,797 $ 75,479 $ 1,635 $ 5,632,516 Consumer loans Home equity Performing $ 22,947 $ 29,445 $ 38,774 $ 10,302 $ 3,340 $ 50,613 $ 438,817 $ 9,061 $ 603,299 90 days or more past due — 48 51 1 — 855 — 179 1,134 Total home equity 22,947 29,493 38,825 10,303 3,340 51,468 438,817 9,240 604,433 Automobile Performing $ 863,281 $ 343,203 $ 363,901 $ 211,294 $ 59,288 $ 59,512 $ — $ — $ 1,900,479 90 days or more past due 71 122 140 70 2 181 — — 586 Total automobile 863,352 343,325 364,041 211,364 59,290 59,693 — — 1,901,065 Other consumer Performing $ 15,164 $ 25,884 $ 15,787 $ 1,588 $ 337 $ 53,917 $ 956,339 $ 15,917 $ 1,084,933 90 days or more past due — 59 61 — — 38 — 248 406 Total other consumer 15,164 25,943 15,848 1,588 337 53,955 956,339 16,165 1,085,339 Total consumer $ 901,463 $ 398,761 $ 418,714 $ 223,255 $ 62,967 $ 165,116 $ 1,395,156 $ 25,405 $ 3,590,837 Gross loan charge-offs $ 1,014 $ 1,883 $ 1,511 $ 1,015 $ 519 $ 2,245 $ — $ 131 $ 8,318 32 Loan modifications to borrowers experiencing financial difficulty. From time to time, Valley may extend, restructure, or otherwise modify the terms of existing loans, on a case-by-case basis, to remain competitive and retain certain customers, as well as assist other customers who may be experiencing financial difficulties. The following tables present the amortized cost basis of loans to borrowers experiencing financial difficulty at June 30, 2025 that were modified during the three and six months ended June 30, 2025 and 2024, disaggregated by class of financing receivable and type of modification. Term extension Term extension and interest rate reduction Term extension and principal forgiveness Other than Insignificant Payment Delay Total % of Total Loan Class ($ in thousands) Three Months Ended June 30, 2025 Commercial and industrial $ 8,306 $ — $ — $ — $ 8,306 0.08 % Commercial real estate 3,020 4,008 — — 7,028 0.03 Total $ 11,326 $ 4,008 $ — $ — $ 15,334 0.03 % Three Months Ended June 30, 2024 Commercial and industrial $ 45,807 $ — $ — $ — $ 45,807 0.48 % Commercial real estate 180 — — — 180 — Residential mortgage 898 — — — 898 0.02 Total $ 46,885 $ — $ — $ — $ 46,885 0.10 % Six Months Ended June 30, 2025 Commercial and industrial $ 10,304 $ — $ — $ 5,610 $ 15,914 0.15 % Commercial real estate 10,413 4,008 20,760 396 35,577 0.14 Total $ 20,717 $ 4,008 $ 20,760 $ 6,006 $ 51,491 0.10 % Six Months Ended June 30, 2024 Commercial and industrial $ 79,953 $ 138 $ — $ — $ 80,091 0.84 % Commercial real estate 224 16,221 — — 16,445 0.06 Residential mortgage 898 — — — 898 0.02 Total $ 81,075 $ 16,359 $ — $ — $ 97,434 0.19 % 33 The following table describes the types of modifications made to borrowers experiencing financial difficulty during the three and six months ended June 30, 2025 and 2024: Weighted Average Interest Rate Reduction Weighted Average Term Extension (in months) Principal Forgiveness (in thousands) Weighted Average Payment Deferral (in months) Three Months Ended June 30, 2025 Commercial and industrial — % 18 $ — — Commercial real estate 5.50 3 — — Three Months Ended June 30, 2024 Commercial and industrial — % 11 $ — — Commercial real estate — 2 — — Residential mortgage — 50 — — Six Months Ended June 30, 2025 Commercial and industrial — % 17 $ — 6 Commercial real estate 5.50 26 17,500 * 6 Six Months Ended June 30, 2024 Commercial and industrial 1.11 % 8 $ — — Commercial real estate 1.06 12 — — Residential mortgage — 50 — — Home equity — 120 — — * Relates to one loan that was partially charged off during the fourth quarter 2024 with the subsequent execution of the corresponding principal forgiveness completed in the first quarter 2025. 34 Valley closely monitors the performance of modified loans to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table presents the aging analysis of loans that have been modified within the previous 12 months at June 30, 2025 and 2024. Current 30-89 Days Past Due 90 Days or More Past Due Total June 30, 2025 ($ in thousands) Commercial and industrial $ 75,699 * $ — $ — $ 75,699 Commercial real estate 250,109 * — — 250,109 Residential mortgage 1,187 * — 95 * 1,282 Home equity 40 — — 40 Total $ 327,035 $ — $ 95 $ 327,130 June 30, 2024 Commercial and industrial $ 92,728 * $ 96 $ — $ 92,824 Commercial real estate 99,970 — 2,153 * 102,123 Residential mortgage — — 898 * 898 Home equity 30 — — 30 Total $ 192,728 $ 96 $ 3,051 $ 195,875 * Includes non-accrual loans. T he following table provides the amortized cost basis of financing receivables that had a payment default and were modified in the 12 months before default to borrowers experiencing financial difficulty. June 30, 2025 Term extension Six Months Ended June 30, 2024 (in thousands) Residential mortgage $ 898 Total $ 898 Loans in process of foreclosure. OREO balance totaled $ 4.8 million and $ 12.2 million at June 30, 2025 and December 31, 2024, respectively. Residential mortgage and consumer loans secured by residential real estate properties for which formal foreclosure proceedings are in process totaled $ 3.7 million and $ 4.6 million at June 30, 2025 and December 31, 2024, respectively. Collateral dependent loans. Loans are collateral dependent when the debtor is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral. When Valley determines that repayment or satisfaction of the loan depends on the sale of the collateral, 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. 35 The following table presents collateral dependent loans by class as of June 30, 2025 and December 31, 2024: June 30, 2025 December 31, 2024 (in thousands) Collateral dependent loans: Commercial and industrial * $ 114,302 $ 131,898 Commercial real estate 177,569 156,825 Construction 4,477 15,841 Total commercial real estate loans 182,046 172,666 Residential mortgage 29,317 23,797 Home equity 1,323 1,341 Total $ 326,988 $ 329,702 * Includes non-accrual loans collateralized by taxi medallions totaling $ 48.6 million and $ 49.2 million at June 30, 2025 and December 31, 2024, respectively. Allowance for Credit Losses for Loans The allowance for credit losses for loans consists of the allowance for loan losses and the allowance for unfunded credit commitments. The following table summarizes the ACL for loans at June 30, 2025 and December 31, 2024: June 30, 2025 December 31, 2024 (in thousands) Components of allowance for credit losses for loans: Allowance for loan losses $ 579,500 $ 558,850 Allowance for unfunded credit commitments 14,520 14,478 Total allowance for credit losses for loans $ 594,020 $ 573,328 The following table summarizes the provision for credit losses for loans for the periods indicated: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (in thousands) Components of provision for credit losses for loans: Provision for loan losses $ 39,129 $ 86,901 $ 100,428 $ 133,624 (Credit) provision for unfunded credit commitments ( 1,334 ) ( 4,790 ) 42 ( 6,239 ) Total provision for credit losses for loans $ 37,795 $ 82,111 $ 100,470 $ 127,385 36 The following table details the activity in the allowance for loan losses by portfolio segment for the three and six months ended June 30, 2025 and 2024: Commercial and Industrial Commercial Real Estate Residential Mortgage Consumer Total (in thousands) Three Months Ended June 30, 2025 Allowance for loan losses: Beginning balance $ 184,700 $ 321,662 $ 48,906 $ 22,932 $ 578,200 Loans charged-off ( 25,189 ) ( 14,623 ) ( 46 ) ( 2,213 ) ( 42,071 ) Charged-off loans recovered 2,789 643 37 773 4,242 Net charge-offs ( 22,400 ) ( 13,980 ) ( 9 ) ( 1,440 ) ( 37,829 ) Provision (credit) for loan losses 11,115 27,297 ( 67 ) 784 39,129 Ending balance $ 173,415 $ 334,979 $ 48,830 $ 22,276 $ 579,500 Three Months Ended June 30, 2024 Allowance for loan losses: Beginning balance $ 138,593 $ 265,847 $ 44,377 $ 20,431 $ 469,248 Loans charged-off ( 14,721 ) ( 22,356 ) — ( 1,262 ) ( 38,339 ) Charged-off loans recovered 742 150 5 603 1,500 Net (charge-offs) recoveries ( 13,979 ) ( 22,206 ) 5 ( 659 ) ( 36,839 ) Provision for loan losses 24,629 57,452 3,315 1,505 86,901 Ending balance $ 149,243 $ 301,093 $ 47,697 $ 21,277 $ 519,310 Six Months Ended June 30, 2025 Allowance for loan losses: Beginning balance $ 173,002 $ 304,148 $ 58,895 $ 22,805 $ 558,850 Loans charged-off ( 53,645 ) ( 28,046 ) ( 46 ) ( 4,353 ) ( 86,090 ) Charged-off loans recovered 3,599 892 205 1,616 6,312 Net (charge-offs) recoveries ( 50,046 ) ( 27,154 ) 159 ( 2,737 ) ( 79,778 ) Provision (credit) for loan losses 50,459 57,985 ( 10,224 ) 2,208 100,428 Ending balance $ 173,415 $ 334,979 $ 48,830 $ 22,276 $ 579,500 Six Months Ended June 30, 2024 Allowance for loan losses: Beginning balance $ 133,359 $ 249,598 $ 42,957 $ 20,166 $ 446,080 Loans charged-off ( 29,014 ) ( 31,154 ) — ( 3,071 ) ( 63,239 ) Charged-off loans recovered 1,424 391 30 1,000 2,845 Net (charge-offs) recoveries ( 27,590 ) ( 30,763 ) 30 ( 2,071 ) ( 60,394 ) Provision for loan losses 43,474 82,258 4,710 3,182 133,624 Ending balance $ 149,243 $ 301,093 $ 47,697 $ 21,277 $ 519,310 37 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 June 30, 2025 and December 31, 2024. Commercial and Industrial Commercial Real Estate Residential Mortgage Consumer Total (in thousands) June 30, 2025 Allowance for loan losses: Individually evaluated for credit losses $ 46,395 $ 9,023 $ 25 $ — $ 55,443 Collectively evaluated for credit losses 127,020 325,956 48,805 22,276 524,057 Total $ 173,415 $ 334,979 $ 48,830 $ 22,276 $ 579,500 Loans: Individually evaluated for credit losses $ 114,302 $ 182,046 $ 29,317 $ 1,323 $ 326,988 Collectively evaluated for credit losses 10,755,734 28,643,874 5,680,654 3,984,170 49,064,432 Total $ 10,870,036 $ 28,825,920 $ 5,709,971 $ 3,985,493 $ 49,391,420 December 31, 2024 Allowance for loan losses: Individually evaluated for credit losses $ 59,603 $ 16,225 $ 27 $ — $ 75,855 Collectively evaluated for credit losses 113,399 287,923 58,868 22,805 482,995 Total $ 173,002 $ 304,148 $ 58,895 $ 22,805 $ 558,850 Loans: Individually evaluated for credit losses $ 131,898 $ 172,666 $ 23,797 $ 1,341 $ 329,702 Collectively evaluated for credit losses 9,799,502 29,472,292 5,608,719 3,589,496 48,470,009 Total $ 9,931,400 $ 29,644,958 $ 5,632,516 $ 3,590,837 $ 48,799,711 Note 8. Goodwill and Other Intangible Assets The carrying amounts of goodwill allocated to Valley's reporting units at both June 30, 2025 and December 31, 2024, were as follows: Reporting Unit * Wealth Management Consumer Banking Commercial Banking Total (in thousands) $ 78,142 $ 349,646 $ 1,441,148 $ 1,868,936 * The Wealth Management and Consumer Banking reporting units are both components of the overall Consumer Banking operating segment, which is further described in Note 15 . During the second quarter 2025, Valley performed the annual goodwill impairment test at its normal assessment date, which resulted in no impairment of goodwill. During the six months ended June 30, 2025 , 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 imp airment of goodwill recognized during the three and six months ended June 30, 2025 and 2024. 38 The following table summarizes other intangible assets as of June 30, 2025 and December 31, 2024: Gross Intangible Assets Accumulated Amortization Net Intangible Assets (in thousands) June 30, 2025 Loan servicing rights $ 127,325 $ ( 106,685 ) $ 20,640 Core deposits 215,620 ( 148,924 ) 66,696 Other 50,393 ( 23,150 ) 27,243 Total other intangible assets $ 393,338 $ ( 278,759 ) $ 114,579 December 31, 2024 Loan servicing rights $ 125,961 $ ( 104,833 ) $ 21,128 Core deposits 215,620 ( 138,080 ) 77,540 Other 50,393 ( 20,400 ) 29,993 Total other intangible assets $ 391,974 $ ( 263,313 ) $ 128,661 Loan servicing rights are accounted for using the amortization method. Under this method, Valley amortizes the loan servicing assets over the period of the economic life of the assets arising from estimated net servicing revenues. On a quarterly basis, Valley stratifies its loan servicing assets into groupings based on risk characteristics and assesses each group for impairment based on fair value. 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 impairment of loan servicing rights recognized during the three and six months ended June 30, 2025 and 2024. Core deposits are amortized using an accelerated method over a period of 10.0 years. The line item labeled “Other” included in the table above primarily consists of customer lists, certain financial asset servicing contracts and covenants not to compete, which are amortized over their expected lives generally using a straight-line method and have a weighted average amortization period of approximately 13.5 years. Valley evaluates core deposits and other intangibles for impairment when an indication of impairment exists. There was no impairment of core deposits and other intangibles recognized during the three and six months ended June 30, 2025 and 2024. The following table presents the estimated future amortization expense of other intangible assets for the remainder of 2025 through 2029: Year Loan Servicing Rights Core Deposits Other (in thousands) 2025 $ 1,351 $ 10,204 $ 2,630 2026 2,501 17,223 4,805 2027 2,205 13,544 4,205 2028 1,927 10,117 3,633 2029 1,692 7,500 3,081 Valley recognized amortization expense on other intangible assets totaling approximately $ 7.4 million and $ 8.6 million for the three months ended June 30, 2025 and 2024, respectively, and $ 15.4 million and $ 18.0 million for the six months ended June 30, 2025 and 2024, respectively. 39 Note 9. Deposits Included in time deposits are certificates of deposit over $250 thousand totaling $ 2.5 billion and $ 2.4 billion at June 30, 2025 and December 31, 2024, respectively. The scheduled maturities of time deposits as of June 30, 2025 were as follows: Year Amount (in thousands) 2025 $ 6,804,638 2026 3,926,972 2027 1,529,902 2028 578,914 2029 28,774 Thereafter 17,681 Total time deposits $ 12,886,881 Note 10. Borrowed Funds Short-Term Borrowings Short-term borrowings at June 30, 2025 and December 31, 2024 consisted of the following: June 30, 2025 December 31, 2024 (in thousands) FHLB advances $ 100,000 $ — Securities sold under agreements to repurchase 62,244 72,718 Total short-term borrowings $ 162,244 $ 72,718 Long-Term Borrowings Long-term borrowings at June 30, 2025 and December 31, 2024 consisted of the following: June 30, 2025 December 31, 2024 (in thousands) FHLB advances, net $ 2,463,604 $ 2,526,608 Subordinated debt, net * 439,487 647,547 Total long-term borrowings $ 2,903,091 $ 3,174,155 * Subordinated debt is reported net of debt issuance costs that were immaterial at both June 30, 2025 and December 31, 2024. FHLB advances. Long-term FHLB advances had a weighted average interest rate of 4.42 percent and 4.20 percent at June 30, 2025 and December 31, 2024, 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. 40 The long-term FHLB advances at June 30, 2025 are scheduled for contractual balance repayments as follows: Year Amount (in thousands) 2026 $ 601,804 2027 1,066,800 2028 545,000 2029 250,000 Total long-term FHLB advances $ 2,463,604 The FHLB advances reported in the table above are not callable for early redemption. Subordinated debt. On June 15, 2025, Valley redeemed in full $ 115 million of 5.25 percent fixed-to-floating rate subordinated notes issued in June 2020 and due in June 2030. The transaction was accounted for as an early debt extinguishment and resulted in a $ 922 thousand pre-tax loss reported within non-interest expense for the second quarter 2025. Valley also repaid $ 100 million of 4.55 percent fix rate subordinated notes that matured on June 30, 2025. There were no new issuances or other maturities, calls or principal repayments of subordinated debt during the six months ended June 30, 2025. See Note 10 in Valley’s Annual Report for additional information on the outstanding subordinated debt at June 30, 2025. Note 11. Stock–Based Compensation Valley maintains an incentive compensation plan to provide long-term incentives to officers, employees and non-employee directors whose contributions are essential to the continued growth and success of Valley. Under the plan, Valley may issue awards in amounts up to 14.5 million shares, subject to certain adjustments. As of June 30, 2025, 6.8 million shares of common stock were available for issuance under the plan. RSUs are awarded as performance-based RSUs and time-based RSUs. Performance-based RSUs vest based on (i) growth in tangible book value per share plus dividends and (ii) total shareholder return as compared to our peer group. The performance based RSUs “cliff” vest after three years based on the cumulative performance of Valley during that time period. Generally, time-based RSUs vest ratably in one-third increments each year over a three-year vesting period. The RSUs earn dividend equivalents (equal to cash dividends paid on Valley's common shares) over the applicable performance or service period. Dividend equivalents, per the terms of the agreements, are accumulated and paid to the grantee at the vesting date or forfeited if the applicable performance or service conditions are not met. The table below summarizes RSU awards granted and average grant date fair values for the three and six months ended June 30, 2025 and 2024: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (in thousands, except per share data) Award shares granted: Performance-based RSUs 93 — 742 958 Time-based RSUs 571 193 3,077 2,987 Average grant date fair value per share: Performance-based RSUs $ 9.87 $ — $ 10.91 $ 7.88 Time-based RSUs $ 8.90 $ 7.68 $ 9.76 $ 8.46 Stock award fair values are expensed over the shorter of the vesting or required service period. Valley recorded total stock-based compensation expense of approximately $ 6.8 million and $ 7.6 million for the three months ended June 41 30, 2025 and 2024, respectively, and $ 13.6 million and $ 15.7 million for the six months ended June 30, 2025 and 2024, respectively. As of June 30, 2025, the unrecognized amortization expense for all stock-based employee compensation totaled approximately $ 49.6 million. This expense will be recognized over an average remaining vesting period of approximately 2.2 years. See Note 12 in Valley’s Annual Report for additional information on the stock-based compensation awards. Note 12. Derivative Instruments and Hedging Activities Valley enters into derivative financial instruments to manage exposures that arise from business activities that result in the payment of future known and uncertain cash amounts, the value of which are determined by interest and currency rates. Cash Flow Hedges of Interest Rate Risk. Valley’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish these objectives, Valley has used interest rate swaps, from time to time, as part of its interest rate risk management strategy. 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. Fair Value Hedges of Fixed Rate Assets and Liabilities. Valley is exposed to changes in the fair value of certain fixed-rate assets and liabilities due to changes in interest rates and uses interest rate swaps to manage the exposure to changes in fair value. For derivatives that are designated and qualify as fair value hedges, the gain or loss on the derivative as well as the loss or gain on the hedged item attributable to the hedged risk are recognized in earnings. During the third quarter 2024, Valley terminated interest rate swaps with a total notional amount of $ 500 million used to hedge the fair value of certain fixed rate residential loans. The carrying amount of the hedged assets included an immaterial cumulative loss adjustment at the date of termination that will be amortized to earnings through the fourth quarter 2025. See Note 15 to Valley's Annual Report for additional information regarding Valley's fair value hedges. Non-designated Hedges. Derivatives not designated as hedges may be used to manage Valley’s exposure to interest rate movements or to provide a service to customers but do not meet the requirements for hedge accounting under GAAP. Derivatives not designated as hedges are not entered into for speculative purposes. Valley executes interest rate swaps with commercial lending customers to facilitate their respective risk management strategies. These interest rate swaps with customers are simultaneously offset by interest rate swaps that Valley executes with a third- party, such that Valley minimizes its net risk exposure resulting from such transactions. As these interest rate swaps do not meet the strict hedge accounting requirements, changes in the fair value of both the customer swaps and the offsetting swaps are recognized directly in earnings. Valley sometimes enters into risk participation agreements with external lenders where the banks are sharing their risk of default on the interest rate swaps on participated loans. Valley either pays or receives a fee depending on the type of participation. Risk participation agreements are credit derivatives not designated as hedges. Credit derivatives are not speculative and are not used to manage interest rate risk in assets or liabilities. Changes in the fair value in credit derivatives are recognized directly in earnings. At June 30, 2025, Valley had 63 credit swaps with an aggregate notional amount of $ 946.9 million related to risk participation agreements. At June 30, 2025, 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 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 Term SOFR rate and, therefore, provide an effective economic hedge. Valley regularly enters into mortgage banking derivatives which are non-designated hedges. These derivatives include interest rate lock commitments provided to customers to fund certain residential mortgage loans to be sold into the secondary market and forward commitments for the future delivery of such loans. Valley enters into 42 forward commitments for the future delivery of residential mortgage loans when interest rate lock commitments are entered into in order to economically hedge the effect of future changes in interest rates on Valley's commitments to fund the loans as well as on its portfolio of mortgage loans held for sale. Valley enters into foreign currency forward and option contracts, primarily to accommodate our customers that are not designated as hedging instruments. Upon the origination of certain foreign currency denominated transactions (including foreign currency holdings and non-U.S. dollar denominated loans) with a client, we enter into a respective hedging contract with a third party financial institution to mitigate the economic impact of foreign currency exchange rate fluctuation. During June 2024, Valley entered into a credit default swap related to approximately $ 1.5 billion in automobile loans primarily to enhance the risk profile of these assets for regulatory capital purposes. The covered loans have a total remaining balance of $ 874.9 million within Valley's $ 2.2 billion automobile loan portfolio at June 30, 2025. The credit default swap is a free-standing contract measured at fair value with resulting gains or losses recognized in non-interest expense. The premium amortization expense associated with the credit protection totaled $ 1.8 million and $ 3.8 million for the three and six months ended June 30, 2025 and was recorded in other expense reported in non-interest expense. Amounts included in the consolidated statements of financial condition related to the fair value of Valley’s derivative financial instruments were as follows: June 30, 2025 December 31, 2024 Fair Value Fair Value Other Assets Other Liabilities Notional Amount Other Assets Other Liabilities Notional Amount (in thousands) Derivatives designated as hedging instruments: Fair value hedge interest rate swaps $ 6,469 $ 8,830 $ 780,322 $ 2,419 $ 13,993 $ 780,322 Total derivatives designated as hedging instruments $ 6,469 $ 8,830 $ 780,322 $ 2,419 $ 13,993 $ 780,322 Derivatives not designated as hedging instruments: Interest rate swaps and other contracts * $ 196,937 $ 196,646 $ 16,982,940 $ 423,683 $ 423,492 $ 16,209,499 Foreign currency derivatives 28,616 28,445 1,942,724 18,011 16,488 1,688,338 Mortgage banking derivatives 101 204 44,783 150 192 45,752 Credit default swap — 50 874,898 — 35 1,142,026 Total derivatives not designated as hedging instruments $ 225,654 $ 225,345 $ 19,845,345 $ 441,844 $ 440,207 $ 19,085,615 Total derivative financial instruments $ 232,123 $ 234,175 $ 20,625,667 $ 444,263 $ 454,200 $ 19,865,937 * Other derivative contracts include risk participation agreements. 43 Gains included in the consolidated statements of income and other comprehensive loss, on a pre-tax basis, related to previously terminated interest rate derivatives designated as hedges of cash flows were as follows: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (in thousands) Amount of gain reclassified from accumulated other comprehensive loss to interest income $ 304 $ 299 $ 605 $ 597 The accumulated after-tax gains related to the previously terminated cash flow hedges included in accumulated other comprehensive loss were $ 806 thousand and $ 1.2 million at June 30, 2025 and December 31, 2024, respectively. Valley estimates that $ 875 thousand (before tax) will be reclassified as an increase to interest income 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: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (in thousands) Derivative - interest rate swap: Interest income $ — $ 676 $ — $ 5,555 Interest expense 2,155 3,004 6,724 1,713 Hedged items - loans, time deposits and subordinated debt: Interest income $ ( 161 ) $ ( 702 ) $ ( 322 ) $ ( 5,626 ) Interest expense ( 2,194 ) ( 3,063 ) ( 6,726 ) ( 1,680 ) 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 June 30, 2025 and December 31, 2024. Line Item in the Statement of Financial Condition in Which the Hedged Item is Included Net Carrying Amount of the Hedged Asset/ Liability Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Asset/Liability (in thousands) June 30, 2025 Time deposits $ 484,218 $ 3,914 Long-term borrowings * 290,601 ( 8,627 ) December 31, 2024 Time deposits $ 482,723 $ 2,419 Long-term borrowings * 284,966 ( 13,859 ) * Net carrying amount includes unamortized debt issuance costs of $ 772 thousand and $ 1.2 million at June 30, 2025 and December 31, 2024, respectively. 44 The net 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 June 30, 2025 2024 2025 2024 (in thousands) Non-designated hedge interest rate swaps and credit derivatives Other non-interest expense $ ( 1,930 ) $ ( 1,781 ) $ ( 4,989 ) $ ( 726 ) Capital markets income reported in non-interest income included fee income related to non-designated hedge derivative interest rate swaps executed with commer cial loan customers and foreign exchange contracts (not designated as hedging instruments) with a combined total of $ 8.3 million and $ 6.8 million for the three months ended June 30, 2025 and 2024, respectively, and $ 14.0 million and $ 11.3 million for the six months ended June 30, 2025 and 2024, respectively. Collateral Requirements and Credit Risk Related Contingent Features . By using derivati ves, Valley is exposed to credit risk if counterparties to the derivative contracts do not perform as expected. Management attempts to minimize counterparty credit risk through credit approvals, limits, monitoring procedures and obtaining collateral where appropriate. Credit risk exposure associated with derivative contracts is managed at Valley in conjunction with Valley’s consolidated counterparty risk management process. Valley’s counterparties and the risk limits monitored by management are periodically reviewed and approved by the Board. Valley has agreements with its derivative counterparties providing that if Valley defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then Valley could also be declared in default on its derivative counterparty agreements. Additionally, Valley has an agreement with several of its derivative counterparties that contains provisions that require Valley’s debt to maintain an investment grade credit rating from each of the major credit rating agencies from which it receives a credit rating. 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 June 30, 2025, 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 was in a net asset position at June 30, 2025. Valley has derivative counterparty agreements that require minimum collateral posting thresholds for certain counterparties. Note 13. Balance Sheet Offsetting Certain financial instruments, including certain OTC derivatives (mostly interest rate swaps) and repurchase agreements (accounted for as secured long-term borrowings), may be eligible for offset in the consolidated statements of financial condition and/or subject to master netting arrangements or similar agreements. OTC derivatives include interest rate swaps executed and settled bilaterally with counterparties without the use of an organized exchange or central clearing house (presented in the table below). The credit risk associated with bilateral OTC derivatives is managed through obtaining collateral and enforceable master netting agreements. Valley is party to master netting arrangements with its financial institution counterparties; however, Valley does not offset assets and liabilities under these arrangements for financial statement presentation purposes. The master netting arrangements provide for a single net settlement of all swap agreements, as well as collateral, in the event of default on, or termination of, any one contract. Collateral, usually in the form of cash or marketable investment securities, is posted by or received from the counterparty with net liability or asset positions, respectively, in accordance with contract thresholds. Master repurchase agreements which include “right of set-off” provisions generally have a legally enforceable right to offset recognized amounts. In such cases, the collateral would be used 45 to settle the fair value of the swap or repurchase agreement should Valley be in default. 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 June 30, 2025 and December 31, 2024. Gross Amounts Not Offset Gross Amounts Recognized Gross Amounts Offset Net Amounts Presented Financial Instruments Cash Collateral * Net Amount (in thousands) June 30, 2025 Assets Interest rate swaps and other contracts $ 203,406 $ — $ 203,406 $ 92,986 $ ( 241,945 ) $ 54,447 Liabilities Interest rate swaps and other contracts $ 205,476 $ — $ 205,476 $ ( 92,986 ) $ — $ 112,490 December 31, 2024 Assets Interest rate swaps and other contracts $ 426,102 $ — $ 426,102 $ 32,571 $ ( 358,520 ) $ 100,153 Liabilities Interest rate swaps and other contracts $ 437,485 $ — $ 437,485 $ ( 32,571 ) $ — $ 404,914 * Cash collateral received from or pledged to our counterparties in relation to market value exposures of OTC derivative contracts in an asset/liability position. Note 14. Tax Credit Investments Valley’s tax credit investments are primarily related to investments promoting qualified affordable housing projects and other investments related to community development. Some of these tax-advantaged investments support Valley’s regulatory compliance with the CRA. Valley’s investments in these entities generate a return primarily through the realization of federal income tax credits and other tax benefits, such as tax deductions from operating losses of the investments, over specified time periods. These tax credits and deductions are recognized as a reduction of income tax expense. Valley’s tax credit investments are carried in other assets on the consolidated statements of financial condition. Valley’s unfunded capital and other commitments related to the tax credit investments are carried in accrued expenses and other liabilities on the consolidated statements of financial condition. Valley recognizes amortization of tax credit investments, including impairment losses, within non-interest expense in the consolidated statements of income using the equity method of accounting. 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. 46 The following table presents the balances of Valley’s affordable housing tax credit investments, other tax credit investments at June 30, 2025 and December 31, 2024: June 30, 2025 December 31, 2024 (in thousands) Other assets: Affordable housing tax credit investments, net $ 27,447 $ 22,742 Other tax credit investments, net 352,928 278,468 Total tax credit investments, net $ 380,375 $ 301,210 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, 2025 and 2024: Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (in thousands) Components of income tax expense: Affordable housing tax credits and other tax benefits $ 2,151 $ 1,263 $ 3,376 $ 2,659 Other tax credit investment credits and tax benefits 10,120 6,684 21,009 13,029 Total reduction in income tax expense $ 12,271 $ 7,947 $ 24,385 $ 15,688 Amortization of tax credit investments: Affordable housing tax credit investment losses $ 1,050 $ 876 $ 1,750 $ 1,751 Affordable housing tax credit investment impairment losses 374 10 739 491 Other tax credit investment losses 3,622 1,680 4,394 2,280 Other tax credit investment impairment losses 4,088 3,225 11,571 6,831 Total amortization of tax credit investments recorded in non-interest expense $ 9,134 $ 5,791 $ 18,454 $ 11,353 Note 15. Operating Segments Valley manages its business operations under operating segments consisting of Consumer Banking and Commercial Banking. Activities not assigned to the operating segments are included in Treasury and Corporate Other. The CEO of Valley is the CODM who assesses performance of each operating segment to better understand their cost, opportunity value and impact to Valley's consolidated earnings. Each operating segment is reviewed routinely for its asset growth, contribution to our income before income taxes, 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 segment s. No changes to the operating segments were determined necessary during the six months ended June 30, 2025. The Consumer Banking segment 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. The duration of the residential mortgage loan portfolio is subject to movements in the market level of interest rates and forecasted prepayment speeds. The average weighted life of the automobile loans within the portfolio is relatively unaffected by movements in the market level of interest rates. However, the average life may be impacted by new loans as a result of the availability of credit within the automobile marketplace and consumer demand for purchasing new or used automobiles. Consumer Banking also includes the Wealth Management and Insurance Services Division, comprised of asset management advisory, brokerage, trust, personal and title insurance, tax credit advisory services, and international and domestic private banking businesses. 47 The Commercial Banking segment is comprised of floating rate and adjustable rate commercial and industrial loans and construction loans, as well as adjustable and fixed rate owner occupied and commercial real estate loans. Due to the portfolio’s interest rate characteristics, Commercial Banking is Valley’s operating segment that is most sensitive to movements in market interest rates. Treasury and Corporate Other largely consists of the Treasury managed HTM debt securities and AFS debt securities portfolios mainly utilized in the liquidity management needs of our lending segments and income and expense items resulting from support functions not directly attributable to a specific segment. Interest income is generated through investments in various types of securities (mainly comprised of fixed rate securities) and interest-bearing deposits with other banks (primarily the Federal Reserve Bank of New York). 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 operating segments. Other non-interest income items and general expenses are allocated from Treasury and Corporate Other to each operating segment utilizing a methodology that involves an allocation of operating and funding costs based on each segment's respective mix of average interest earning assets outstanding for the period, number of deposits, or direct allocation to the segments based on the nature of income and expense. U nallocated items included in Treasury and Corporate Other consist of net gains and losses on AFS and HTM securities transactions, amortization of tax credit investments, as well as other non-core items, including loss on extinguishment of debt, corporate restructuring charges and the FDIC special assessment. The accounting for each operating segment and Treasury and Corporate Other 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 GAAP. The financial reporting for each segment contains allocations and reporting in line with Valley’s operations, which may not necessarily be comparable to any other financial institution. Furthermore, changes in management structure or allocation methodologies and procedures may result in changes in reported segment financial data. Certain prior period amounts have been reclassified to conform to the current presentation for each operating segment and Treasury and Corporate Other. The following tables represent the financial data for Valley’s operating segments and Treasury and Corporate Other for the three and six months ended June 30, 2025 and 2024: Three Months Ended June 30, 2025 Consumer Banking Commercial Banking Treasury and Corporate Other Total ($ in thousands) Average interest earning assets $ 10,428,625 $ 38,604,012 $ 8,520,987 $ 57,553,624 Interest income $ 130,616 $ 588,422 $ 85,974 $ 805,012 Interest expense 68,915 248,524 55,165 372,604 Net interest income 61,701 339,898 30,809 432,408 Provision for credit losses 717 37,078 4 37,799 Net interest income after provision for credit losses 60,984 302,820 30,805 394,609 Non-interest income 32,192 24,999 5,413 62,604 Non-interest expense Salary and employee benefits expense 32,294 99,173 13,955 145,422 Net occupancy expense 4,772 16,960 3,751 25,483 Technology, furniture, and equipment expense 6,266 20,469 3,932 30,667 FDIC insurance assessment 2,650 9,542 — 12,192 Professional and legal fees 3,344 14,191 2,435 19,970 Loss on extinguishment of debt — — 922 922 Other segment items * 12,021 17,337 20,108 49,466 Total non-interest expense $ 61,347 $ 177,672 $ 45,103 $ 284,122 Income (loss) before income taxes $ 31,829 $ 150,147 $ ( 8,885 ) $ 173,091 Return on average interest earning assets (pre-tax) 1.22 % 1.56 % ( 0.42 ) % 1.20 % Net interest margin 2.37 % 3.52 % 1.45 % 3.01 % 48 Three Months Ended June 30, 2024 Consumer Banking Commercial Banking Treasury and Corporate Other Total ($ in thousands) Average interest earning assets $ 9,836,298 $ 40,184,603 $ 6,752,049 $ 56,772,950 Interest income $ 118,537 $ 652,427 $ 62,502 $ 833,466 Interest expense 74,780 305,635 51,366 431,781 Net interest income 43,757 346,792 11,136 401,685 Provision (credit) for credit losses 4,820 77,291 ( 41 ) 82,070 Net interest income after provision for credit losses 38,937 269,501 11,177 319,615 Non-interest income 31,568 16,494 3,151 51,213 Non-interest expense Salary and employee benefits expense 29,776 99,422 11,617 140,815 Net occupancy expense 4,262 17,147 2,843 24,252 Technology, furniture, and equipment expense 6,589 24,740 3,874 35,203 FDIC insurance assessment 2,570 10,513 1,363 14,446 Professional and legal fees 2,377 14,256 1,305 17,938 Other segment items * 12,940 11,645 20,258 44,843 Total non-interest expense $ 58,514 $ 177,723 $ 41,260 $ 277,497 Income (loss) before income taxes $ 11,991 $ 108,272 $ ( 26,932 ) $ 93,331 Return on average interest earning assets (pre-tax) 0.49 % 1.08 % ( 1.60 ) % 0.66 % Net interest margin 1.78 % 3.45 % 0.66 % 2.83 % Six Months Ended June 30, 2025 Consumer Banking Commercial Banking Treasury and Corporate Other Total ($ in thousands) Average interest earning assets $ 10,428,621 $ 38,416,202 $ 8,379,663 $ 57,224,486 Interest income $ 253,079 $ 1,168,318 $ 168,367 $ 1,589,764 Interest expense 134,357 494,934 107,960 737,251 Net interest income 118,722 673,384 60,407 852,513 (Credit) provision for credit losses ( 8,016 ) 108,486 ( 10 ) 100,460 Net interest income after provision for credit losses 126,738 564,898 60,417 752,053 Non-interest income 66,546 44,001 10,351 120,898 Non-interest expense Salary and employee benefits expense 64,268 202,163 21,609 288,040 Net occupancy expense 9,477 34,417 7,477 51,371 Technology, furniture, and equipment expense 12,503 40,322 7,738 60,563 FDIC insurance assessment 5,350 19,709 — 25,059 Professional and legal fees 6,243 25,134 4,263 35,640 Loss on extinguishment of debt — — 922 922 Other segment items * 26,307 32,780 40,058 99,145 Total non-interest expense $ 124,148 $ 354,525 $ 82,067 $ 560,740 Income (loss) before income taxes $ 69,136 $ 254,374 $ ( 11,299 ) $ 312,211 Return on average interest earning assets (pre-tax) 1.33 % 1.32 % ( 0.27 ) % 1.09 % Net interest margin 2.27 % 3.50 % 1.44 % 2.98 % 49 Six Months Ended June 30, 2024 Consumer Banking Commercial Banking Treasury and Corporate Other Total ($ in thousands) Average interest earning assets $ 9,814,532 $ 40,319,214 $ 6,562,128 $ 56,695,874 Interest income $ 232,299 $ 1,310,218 $ 119,605 $ 1,662,122 Interest expense 150,066 616,487 100,336 866,889 Net interest income 82,233 693,731 19,269 795,233 Provision for credit losses 7,892 119,493 ( 115 ) 127,270 Net interest income after provision for credit losses 74,341 574,238 19,384 667,963 Non-interest income 64,733 39,624 8,271 112,628 Non-interest expense Salary and employee benefits expense 58,434 201,280 22,932 282,646 Net occupancy expense 8,530 34,510 5,535 48,575 Technology, furniture, and equipment expense 13,126 50,004 7,535 70,665 FDIC insurance assessment 4,684 19,242 8,756 32,682 Professional and legal fees 5,204 26,337 2,862 34,403 Other segment items * 25,531 24,848 38,457 88,836 Total non-interest expense $ 115,509 $ 356,221 $ 86,077 $ 557,807 Income (loss) before income taxes $ 23,565 $ 257,641 $ ( 58,422 ) $ 222,784 Return on average interest earning assets (pre-tax) 0.48 % 1.28 % ( 1.78 ) % 0.79 % Net interest margin 1.67 % 3.44 % 0.59 % 2.80 % * Other segment items include amortization of intangible assets, amortization of tax credit investments and other general operating expenses.