What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-08-06 compared with 2026-05-07 · 449 added, 288 removed, 747 unchanged (50% of the section changed)

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federal government and its agencies in connection with prolonged inflationary pressures, which could have a material adverse effect on our clients, our business, our employees, and our ability to provide services to our customers;

• the impact of unfavorable macroeconomic conditions or downturns, including instability or volatility in financial markets resulting from the impact of tariffs/import fees and other trade policies and practices, any retaliatory actions, related market uncertainty, or other factors;

government debt default or rating downgrade;

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and other potential negative effects on our business, employees or clients caused by factors outside of our control, such as new legislation and policy changes under the current U.S.

presidential administration, any shutdown of the U.S federal government, geopolitical instabilities or events, including ongoing conflicts in the Middle East, natural and other disasters, including severe weather events and other climate-related risks, health emergencies, acts of terrorism, or other external events;

presidential administration, any shutdown of the U.S.

federal government, geopolitical instabilities or events, including ongoing conflicts in the Middle East, natural and other disasters, including severe weather events and other climate-related risks, health emergencies, acts of terrorism, or other external events;

• the impact of any potential instability within the U.S.

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We undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in our expectations, except as required by law.

Although we believe that the expectations reflected in the

forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

Critical Accounting Estimates

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In preparing the consolidated financial statements, management has made estimates, judgments and assumptions in accordance with these policies 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.

At March 31, 2026, we identified our policies on the allowance for credit losses, goodwill and other intangible assets, and income taxes to be critical accounting policies because management has to make subjective and/or complex judgments about matters that are inherently uncertain and because it is likely that materially different amounts would be reported under different conditions or using different assumptions.

At June 30, 2026, we identified our policies on the allowance for credit losses, goodwill and other intangible assets, and income taxes to be critical accounting policies because management has to make subjective and/or complex judgments about matters that are inherently uncertain and because it is likely that materially different amounts would be reported under different conditions or using different assumptions.

Management has reviewed the application of these policies and estimates with the Audit Committee of Valley’s Board.

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Company Overview.

At March 31, 2026, Valley had consolidated total assets of approximately $64.5 billion, total net loans of $50.2 billion, total deposits of $52.9 billion and total shareholders’ equity of $7.8 billion.

Valley operates many convenient branch office locations and commercial banking offices in northern and central New Jersey, the New York City boroughs of Manhattan, Brooklyn and Queens, Long Island, Westchester County, New York, Florida, California, Alabama, and Illinois.

Of our current 230 branch network, 55 percent, 18 percent, and 18 percent of the branches are located in New Jersey, New York, and Florida, respectively, with the remaining 9 percent of the branches in Alabama, California, and Illinois combined.

At June 30, 2026, Valley had consolidated total assets of approximately $66.3 billion, total net loans of $51.9 billion, total deposits of $54.1 billion and total shareholders’ equity of $7.9 billion.

Valley operates many convenient branch and commercial banking office locations nationwide and serves clients across New Jersey, New York, Florida, Alabama, California, Illinois, Pennsylvania and Arizona.

Of our current network of 228 branches, 55 percent, 18 percent, and 19 percent of the branches are located in New Jersey, New York, and Florida, respectively, with the remaining 8 percent of the branches in Alabama, California, and Illinois combined.

Financial Condition.

During the first quarter 2026, we continued to expand our business and grow the balance sheet in a responsible manner to best perform in the current uncertain economic environment, while also prudently managing the overall risk of our loan portfolio.

The following items are highlights at March 31, 2026.

Total deposit balances increased $676.5 million to $52.9 billion at March 31, 2026 as compared to $52.2 billion at December 31, 2025.

During the quarter, our direct customer deposits increased $955.0 million, which enabled the net reduction of $278.5 million of indirect (brokered) customer deposits.

Direct customer deposit growth was driven by strength in the savings, NOW and money market deposit category primarily as a result of new commercial and online customer deposits.

Non-Interest bearing deposits also increased $95.5 million reflecting inflows from both commercial and retail customers during the first quarter 2026.

During the second quarter 2026, we continued to expand our business and grow the balance sheet in a responsible manner to best perform in the current economic environment, while also prudently managing the overall risk of our loan portfolio.

The following items are highlights at June 30, 2026.

Total deposit balances increased $1.3 billion to $54.1 billion at June 30, 2026 as compared to $52.9 billion at March 31, 2026.

Direct customer deposits increased $1.1 billion during the second quarter 2026 mainly due to inflows from retail CD offerings and growth in our commercial customer deposits.

Non-interest bearing deposits increased $298.6 million reflecting continued expansion of relationships with commercial banking customers during the second quarter 2026.

See the “Deposits and Other Borrowings” section for more details.

Total loans increased $692.1 million, or 5.5 percent on an annualized basis, to $50.8 billion at March 31, 2026 from December 31, 2025 mostly due to increases of $466.0 million and $142.6 million in total commercial real estate loans and commercial and industrial loans, respectively.

New owner occupied loans continued to drive a disproportionate amount of growth within the commercial real estate loan portfolio during the first quarter 2026 while loan originations from a range of relationship-driven small to midsize clients contributed to the increase in commercial and industrial loans at March 31, 2026.

Based on our current loan growth

targets, we expect a continued gradual reduction of the CRE loan concentration ratio over the remainder of 2026.

Total loans increased $1.6 billion, or 12.9 percent on an annualized basis, to $52.5 billion at June 30, 2026 from March 31, 2026 mostly due to increases of $857.2 million and $638.9 million in commercial and industrial loans and total commercial real estate loans, respectively.

Loan originations from a range of relationship-driven small to midsize clients continued to drive the growth in commercial and industrial loans during the second quarter 2026, while new owner occupied and select multifamily loan originations were the primary contributors to the growth in the commercial real estate loan portfolio at

June 30, 2026.

Our CRE loan concentration ratio (defined as total commercial real estate loans held for investment and held for sale, excluding owner occupied loans, as a percentage of total risk-based capital) continued to decline to 317 percent at June 30, 2026 from 329 percent at March 31, 2026 largely due to organic capital accretion and a $200 million increase in (Tier 2) total risk-based capital related to our issuance of subordinated notes during the second quarter 2026.

Based on our current loan growth and regulatory capital targets, we expect a continued gradual reduction of the CRE loan concentration ratio over the second half of 2026.

See further details of our loan activities under the “Loan Portfolio” section below.

• Allowance for Credit Losses for Loans :

The ACL for loans totaled $599.8 million and $596.1 million at March 31, 2026 and December 31, 2025, respectively, representing 1.18 percent and 1.19 percent of total loans at each respective date.

Given our current projections for loan growth and credit trends within our loan portfolio, we do not anticipate a material change in the ACL for loans as a percentage of total loans during the remainder of 2026.

However, we can provide no assurance that our actual future ACL for loans required under our CECL methodology will not increase as a percent of total loans due to the uncertain nature of our assumptions or other factors.

The ACL for loans totaled $606.9 million and $599.8 million at June 30, 2026 and March 31, 2026, respectively, representing 1.16 percent and 1.18 percent of total loans at each respective date.

During the second quarter 2026, we recorded a provision for credit losses for loans of $29.2 million as compared to $21.2 million and $37.8 million for the first quarter 2026 and second quarter 2025, respectively.

See the “Allowance for Credit Losses for Loans” section for additional information.

• Credit Quality:

Net loan charge-offs totaled $17.5 million for the first quarter 2026 as compared to $22.6 million and $41.9 million for the fourth quarter 2025 and first quarter 2025, respectively.

Total accruing past due loans (i.e., loans past due 30 days or more and still accruing interest) decreased $13.4 million to $127.9 million, or 0.25 percent of total loans, at March 31, 2026 as compared to $141.3 million, or 0.28 percent of total loans, at December 31, 2025.

Non-accrual loans totaled $432.6 million, or 0.85 percent of total loans, at March 31, 2026 as compared to $433.9 million, or 0.87 percent of total loans, at December 31, 2025.

Net loan charge-offs totaled $22.0 million for the second quarter 2026 as compared to $17.5 million and $37.8 million for the first quarter 2026 and second quarter 2025, respectively.

Total accruing past due loans (i.e., loans past due 30 days or more and still accruing interest) increased $52.3 million to $180.2 million, or 0.34 percent of total loans, at June 30, 2026 as compared to $127.9 million, or 0.25 percent of total loans, at March 31, 2026.

The increase was mainly due to a few larger CRE loans within the 30 to 59 days past due delinquency category.

Non-accrual loans totaled $462.6 million, or 0.88 percent of total loans, at June 30, 2026 as compared to $432.6 million, or 0.85 percent of total loans, at March 31, 2026.

See the “Non-Performing Assets” section for additional information.

• Liquid Assets:

Our liquid assets totaled $5.6 billion at March 31, 2026, representing 9.4 percent of interest earning assets, as compared with $6.1 billion, or 10.3 percent of interest earning assets at December 31, 2025.

Our liquid assets totaled $5.6 billion at both June 30, 2026 and March 31, 2026, representing 9.1 percent and 9.4 percent of interest earning assets at each respective period end.

We continue to maintain significant access to readily available, diverse funding sources to fulfill both short-term and long-term funding needs.

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• Regulatory Capital and Shareholders' Equity:

Total shareholders' equity increased $20.7 million to $7.8 billion at March 31, 2026 as compared to December 31, 2025.

Valley's total risk-based capital, CET1 (common equity Tier 1) capital, Tier 1 capital and Tier 1 leverage capital ratios were 13.66 percent, 10.91 percent, 11.60 percent, and 9.56 percent, respectively, at March 31, 2026 as compared to 13.77 percent, 10.99 percent, 11.69 percent and 9.63 percent, respectively, at December 31, 2025.

During the first quarter 2026, we repurchased a total of 4.0 million shares of our common stock at an average price of $12.95 under our current stock repurchase plan.

Currently, we expect that Valley's CET1 capital ratio will remain at the mid to high end of the 10.50 to 11.00 percent range previously disclosed in Valley's Annual Report through December 31, 2026.

Total shareholders' equity increased $88.7 million to $7.9 billion at June 30, 2026 as compared to March 31, 2026.

Valley's total risk-based capital, CET1 (common equity Tier 1) capital, Tier 1 capital and Tier 1 leverage capital ratios were 13.77 percent, 10.71 percent, 11.37 percent, and 9.49 percent, respectively, at June 30, 2026 as compared to 13.66 percent, 10.91 percent, 11.60 percent and 9.56 percent, respectively, at March 31, 2026.

During the second quarter 2026, we repurchased a total of 1.5 million shares of our common stock at an average price of $13.40 under our current stock repurchase plan.

Currently, we expect that Valley's CET1 capital ratio will remain near the midpoint of the 10.50 to 11.00 percent range previously disclosed in Valley's Annual Report through December 31, 2026.

See the “Capital Adequacy” section below for more information.

Quarterly Results.

Net income for the first quarter 2026 was $163.9 million, or $0.28 per diluted common share, as compared to $106.1 million, or $0.18 per diluted common share, for the first quarter 2025.

Net income for the second quarter 2026 was $170.9 million, or $0.29 per diluted common share, as compared to $133.2 million, or $0.22 per diluted common share, for the second quarter 2025.

The $37.7 million increase in quarterly net income as compared to the same quarter one year ago was mainly due to the following changes:

• a $51.4 million increase in net interest income mainly driven by lower interest rates on most interest bearing deposit products and higher average loan and investment securities balances for the first quarter 2026, partially offset by lower yields largely on adjustable-rate loans;

• a $41.4 million decrease in our provision for credit losses mostly due to improved actual and expected performance within the loan portfolio as compared to one year ago;

• a $10.5 million increase in non-interest income that was mainly driven by increases in capital markets income and service charges on deposit accounts.

• a $54.6 million increase in net interest income mainly driven by lower interest rates on most interest bearing deposit products and higher average loan and investment securities balances for the second quarter 2026, partially offset by lower yields largely on adjustable-rate loans;

• an $11.1 million increase in non-interest income that was largely generated by strong transactional income from the capital markets, service charges on deposit accounts, and wealth management and trust fee categories;

• an $8.6 million decrease in our provision for credit losses mostly due to lower commercial and industrial loan charge-offs as compared to one year ago and a decline in quantitative reserves largely within certain commercial real estate loan categories;

which were partially offset by:

• a $33.3 million increase in non-interest expense primarily due to increased investments in talent (largely focused in the commercial and consumer banking and technology areas) and transformation of our business operations and technology, as well as higher tax credit amortization;

• a $27.0 million increase in non-interest expense primarily due to increased investments in talent (largely focused in the commercial and consumer banking and technology areas) and enhancements in our business model and technology transformation efforts, as well as higher tax credit amortization;

• a $9.6 million increase in income taxes mainly due to higher pre-tax income, partially offset by increased investments in tax credits.

See the “Net Interest Income,” “Non-Interest Income,” “Non-Interest Expense” and “Income Taxes” sections below for more details on the impact of the items above and other infrequent non-core items impacting our first quarter 2026 results.

Economic Conditions.

During the first quarter 2026, real GDP increased at an estimated annual rate of 1.2 percent as compared to an increase of 0.5 percent during the fourth quarter 2025.

The first quarter 2026 increase from the fourth quarter 2025 was driven by several factors, including but not limited to consumer spending, decreased imports, and technology related business investment.

Overall, the rate of inflation has decreased to 2.7 percent in the first quarter 2026 as compared to 2.8 percent for the fourth quarter 2025.

While core inflation moderately increased during the first quarter 2026, it still came in slightly below most forecasts.

In March 2026, the FOMC maintained the target range for the federal funds rate at 3.50 - 3.75 percent, unchanged from December 2025, citing elevated inflation and an uncertain economic outlook related to the conflict in the Middle East.

The Committee did not indicate that additional rate cuts are expected in 2026.

During the second quarter 2026, real GDP increased at an estimated annual rate of 1.5 percent as compared to an increase of 2.1 percent during the first quarter 2026.

The decrease from the first quarter 2026 was mainly driven by a decline in government spending, exports, and gross private domestic investment, partly offset by an increase in consumer spending.

Imports increased more in the second quarter than in the first quarter.

Inflation increased to 4.2 percent in the second quarter 2026 as compared to 2.7 percent for the first quarter 2026, primarily driven by higher energy and gasoline prices associated with ongoing geopolitical tensions.

I n June and July 2026, the FOMC maintained the target range for the federal funds rate at 3.50 - 3.75 percent, unchanged since December 2025.

However, the prolonged high level of inflation remains a central focus and could result in future monetary policy actions by the FOMC.

The 10-year U.S.

Treasury note yield ended the first quarter 2026 at 4.30 percent, or 12 basis points higher as compared to the fourth quarter 2025, and the 2-year U.S.

Treasury note yield ended the first quarter 2026 at 3.79 percent, or 32 basis points higher as compared to the fourth quarter 2025.

Treasury note yield ended the second quarter 2026 at 4.42 percent, or 12 basis points higher as compared to the first quarter 2026, and the 2-year U.S.

Treasury note yield ended the second quarter 2026 at 4.14 percent, or 35 basis points higher as compared to the first quarter 2026.

Total loans and leases for U.S.

commercial banks increased 2.2 percent in the first quarter 2026 compared to 1.6 percent in the fourth quarter 2025.

Commercial and industrial loans increased by 3.0 percent, while commercial real estate loans increased 0.7 percent from the fourth quarter 2025 to first quarter 2026.

Overall, most banks reported easing of underwriting standards on commercial real estate loans and a tightening of standards on commercial and industrial loans.

The economic outlook during the first quarter of 2026 continued to be affected by uncertainty related to U.S.

trade and tariff policies, ongoing geopolitical developments, elevated federal deficits, and a moderating labor market.

Although certain measures of inflation showed signs of easing, volatility in energy prices and policy‑driven cost pressures contributed to continued uncertainty regarding the economic and interest rate environment.

These conditions have contributed to a cautious outlook among market participants and analysts and remain a source of pressure on the operating environment for banking institutions.

Should these conditions persist or deteriorate, they could adversely affect our customers, market conditions, and financial results, as discussed elsewhere in this MD&A.

commercial banks increased 2.0 percent in the second quarter 2026 compared to 2.1 percent in the first quarter 2026.

Commercial and industrial loans increased by 3.6 percent, while commercial real estate loans increased 0.8 percent from the first quarter 2026 to second quarter 2026.

Overall, most banks reported tightening of underwriting standards on commercial real estate loans and commercial and industrial loans.

The economic outlook during the second quarter of 2026 was characterized by moderating economic growth, a gradually softening labor market, continuing geopolitical tensions, and ongoing uncertainty regarding U.S.

fiscal, trade and monetary policy.

While consumer spending and business activity generally remained resilient, concerns regarding slower employment growth, elevated government deficits, and the potential economic effects of evolving trade policies and global conflicts contributed to increased caution among businesses and investors.

Inflationary pressures continued to moderate;

however, volatility in energy markets and other external factors created uncertainty regarding the timing and extent of future interest rate adjustments.

These macroeconomic conditions have contributed to a more uncertain operating environment for banking institutions and may affect loan demand, credit performance, deposit trends, and capital markets activity.

Should economic conditions weaken or financial market volatility increase, our customers, business operations, and financial results could be adversely affected, as discussed elsewhere in this MD&A.

Deposits and Other Borrowings

We define cumulative deposit beta as the change in our cost of total deposits relative to the change in the average Fed Funds (upper bound) rate.

We differentiate between the cumulative deposit beta during the "rate increase cycle," which began in the first quarter of 2022 and ended in the second quarter of 2024, and the cumulative deposit beta during the "rate decrease cycle," which started in the third quarter of 2024.

Our cumulative deposit beta in the interest rate increase cycle (between December 31, 2021 and June 30, 2024) was approximately 58 percent.

The Federal Reserve started an interest rate decrease cycle during the third quarter 2024.

Our cumulative deposit beta in this current interest rate decrease cycle (between June 30, 2024 and March 31, 2026) was 52 percent.

Our cumulative deposit beta for the first quarter 2026 was 67 percent.

The beta in the first quarter 2026 was mainly driven by a full quarter’s impact of the Federal Reserve's rate cuts in October and November 2025 and our ability to broadly reduce costs of interest bearing deposit products coupled with the changes in the mix of deposit balances discussed further below.

See the "Net Interest Income" section for additional details on the changes in our cost of deposits during the first quarter 2026.

Total average deposits increased by $1.0 billion to $52.4 billion for the first quarter 2026 as compared to the fourth quarter 2025.

Average savings, NOW and money market deposits increased $1.3 billion to $29.2 billion for the first

quarter 2026 as compared to the fourth quarter 2025 largely due to additional deposits generated from commercial, online and governmental deposit accounts.

Average non-interest bearing deposits also modestly increased $25.2 million to $11.9 billion for the first quarter 2026 as compared to the fourth quarter 2025.

Average time deposit balances decreased $326.5 million from the fourth quarter 2025 mainly due to repayment of higher cost maturing brokered CDs mainly throughout the fourth quarter 2025 and increased funding produced by the other core deposit categories over the last six month period.

Our cumulative deposit beta in this current interest rate decrease cycle (between June 30, 2024 and June 30, 2026) was 51 percent.

The deposit beta in the second quarter 2026 was mainly driven by the mix shift of our deposit balances discussed further below.

See the “Net Interest Income” section for additional details on the changes in our cost of deposits during the second quarter 2026.

Total average deposits increased by $801.1 million to $53.2 billion for the second quarter 2026 as compared to the first quarter 2026.

Average time deposit balances increased $654.4 million from the first quarter 2026 mainly due to

deposits generated from targeted retail CD offerings throughout the second quarter 2026, as well as higher balances of brokered CDs.

Average non-interest bearing deposits also increased $430.7 million to $12.4 billion for the second quarter 2026 as compared to the first quarter 2026 mostly due to the continued successful expansion of our commercial banking customer relationships.

Average savings, NOW and money market deposits decreased $283.9 million to $28.9 billion for the second quarter 2026 as compared to the first quarter 2026 mainly due to repayments of floating rate sweep account balances within brokered deposits, partially offset by additional deposits generated from commercial deposit accounts.

Average non-interest-bearing deposits;

savings, NOW and money market deposits;

and time deposits represented approximately 23 percent, 56 percent, and 21 percent of total deposits for the first quarter 2026, respectively, as compared to 23 percent, 54 percent, and 23 percent of total deposits for the fourth quarter 2025, respectively.

Actual ending balances for deposits increased $676.5 million to $52.9 billion at March 31, 2026 from December 31, 2025 mainly due to additional commercial and online customer deposit balances within the savings, NOW and money market deposit category.

Non-interest bearing deposits increased $95.5 million to $12.3 billion at March 31, 2026 as compared to December 31, 2025 largely driven by deposit inflows from a blend of commercial and retail customers during the first quarter 2026.

Total indirect customer deposits (consisting of brokered time and money market deposits) totaled $5.1 billion and $5.4 billion at March 31, 2026 and December 31, 2025, respectively.

The decrease in indirect customer deposits from December 31, 2025 was mainly related to lower brokered money market deposit balances at March 31, 2026 and increased inflows from direct customer deposits.

and time deposits represented approximately 23 percent, 55 percent, and 22 percent of total deposits for the second quarter 2026, respectively, as compared to 23 percent, 56 percent, and 21 percent of total deposits for the first quarter 2026, respectively.

Actual ending balances for deposits increased $1.3 billion to $54.1 billion at June 30, 2026 from March 31, 2026 mainly due to increases of $1.5 billion and $298.6 million in time and non-interest bearing deposits, respectively, partially offset by a $506.1 million decline in the savings, NOW and money market deposit category.

The increase in time deposits was largely driven by our targeted retail CD offerings and higher indirect customer CD balances at June 30, 2026.

The increase in non-interest bearing deposits was mainly due to continued deposit inflows from commercial banking customers during the second quarter 2026.

The decrease in savings, NOW and money market deposits from March 31, 2026 was mainly driven by lower brokered sweep and governmental account balances at June 30, 2026.

Total indirect customer deposits (mainly consisting of brokered time and money market deposits) totaled $5.3 billion and $5.1 billion at June 30, 2026 and March 31, 2026, respectively.

During the second quarter 2026, we entered into fair value interest rate swap transactions with a combined notional value of $204.3 million that effectively converted a portion of our fixed rate brokered time deposits to variable interest rates through their contractual maturity dates.

See Note 12 to the consolidated financial statements for additional information.

Non-interest bearing deposits;

savings, NOW and money market deposits;

and time deposits represented approximately 23 percent, 55 percent and 22 percent of total deposits at both March 31, 2026 and December 31, 2025.

The following table summarizes CDs included in time deposits in excess of the FDIC insurance limit by maturity at March 31, 2026:

March 31, 2026

and time deposits represented approximately 23 percent, 53 percent and 24 percent of total deposits at June 30, 2026 as compared to 23 percent, 55 percent and 22 percent at March 31, 2026.

The following table summarizes CDs included in time deposits in excess of the FDIC insurance limit by maturity at June 30, 2026:

June 30, 2026

(in thousands)

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Total $ 2,961,605

Total estimated uninsured deposits, excluding collateralized government deposits and intercompany deposits (i.e., deposits eliminated in consolidation), totaled approximately $15.0 billion, or 28 percent of total deposits, at March 31, 2026 as compared to $14.6 billion, or 28 percent of total deposits, at December 31, 2025.

We currently expect our total deposits to grow for the full year of 2026 to be near the high end of the 5 to 7 percent range previously disclosed in Valley's Annual Report.

While we maintained a diversified commercial and consumer deposit base at March 31, 2026, deposit gathering initiatives and our current deposit base could be unexpectedly challenged due to increased market competition, changes in customer behavior, including attractive non-deposit investment alternatives, and other factors.

As a result, we cannot guarantee that we will be able to increase or maintain deposit levels at or near those reported at March 31, 2026.

We currently expect total deposit growth for the full-year 2026 to be near the high end of the 5 to 7 percent range previously disclosed in Valley's Annual Report.

While we maintained a diversified commercial and consumer deposit base at June 30, 2026, deposit gathering initiatives and our current deposit base could be challenged due to increased market competition, changes in customer behavior, including attractive non-deposit investment alternatives, and other factors.

As a result, we cannot guarantee that we will be able to increase or maintain deposit levels at or near those reported at June 30, 2026.

Management continuously monitors liquidity and all available funding sources, including non-deposit borrowings discussed below.

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The following table presents average short-term and long-term borrowings for the periods indicated :

Three Months Ended

March 31, 2026 December 31, 2025 March 31, 2025

Three Months Ended Six Months Ended

June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025

(in thousands)

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Total $ 2,684,781 $ 2,849,479 $ 3,146,434 $ 2,766,675 $ 3,076,770

Average short-term borrowings for the first quarter 2026 decreased $22.5 million from the fourth quarter 2025 and decreased $235.8 million from the first quarter 2025.

The decreases from the fourth quarter 2025 and first quarter 2025 were mainly driven by the maturity and repayment of FHLB advances and a decline in average federal funds purchased balances during the first quarter 2026.

Average long-term borrowings (including junior subordinated debentures issued to capital trusts which are presented separately on the consolidated statements of financial condition) decreased $115.1 million and $156.9 million as compared to the fourth quarter 2025 and first quarter 2025, respectively.

The decrease from the fourth quarter 2025 was mainly due to the maturity and repayment of FHLB advances.

The decrease as compared to the first quarter 2025 was primarily driven by a full redemption of $215.0 million of our subordinated notes in June 2025.

Actual ending balances of short-term borrowings decreased $27.6 million to $63.9 million at March 31, 2026 from December 31, 2025 mainly due to a moderate decrease in securities sold under repurchase agreements.

Long-term borrowings decreased $347.7 million to $2.6 billion at March 31, 2026 as compared to $2.9 billion at December 31, 2025 due to the maturity and repayment of FHLB advances.

Average short-term borrowings for the second quarter 2026 increased $602.3 million from the first quarter 2026 and increased $477.6 million from the second quarter 2025.

The increases were mainly driven by the issuance of new FHLB advances primarily used as a short-term funding source for loan originations during the second quarter 2026.

Average long-term borrowings (including junior subordinated debentures issued to capital trusts which are presented separately on the consolidated statements of financial condition) decreased $164.7 million and $461.7 million as compared to the first quarter 2026 and second quarter 2025, respectively.

The decrease from the first quarter 2026 was mainly due to contractual maturities and repayments of the FHLB advances and, to a lesser extent, Valley's full early redemption of $300 million of its 3.00 percent fixed-to-floating rate subordinated notes on June 15, 2026, partially offset by Valley's issuance of $500 million of 6.219 percent fixed-to-floating rate subordinated notes in May 2026.

Actual ending balances of short-term borrowings increased $369.6 million to $433.5 million at June 30, 2026 from March 31, 2026 due to $375 million of short-term FHLB advances outstanding at June 30, 2026, partially offset by a modest decline in securities sold under repurchase agreements.

Long-term borrowings totaled $2.6 billion at June 30, 2026 and increased $46.3 million as compared to March 31, 2026.

The increase was mainly attributable to the aforementioned issuance of $500 million of subordinated notes and $100 million of long-term FHLB advances, partially offset by the redemption of the 3.00 percent subordinated notes and the repayment of matured FHLB advances during the second quarter 2026.

See Note 10 to the consolidated financial statements for additional information.

Non-GAAP Financial Measures

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Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

Selected Performance Indicators ($ in thousands)

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Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

(in thousands)

2 unchanged sentences

Restructuring charge (1)

2,513 800 8,202 800

Litigation reserve (2)

230 — 1,492 —

Losses on available for sale and held to maturity debt securities, net (3)

Loss on extinguishment of debt — 922 — 922

Total non-GAAP adjustments to net income $ 2,743 $ 1,722 $ 9,704 $ 1,733

Income tax adjustments related to non-GAAP adjustments (4)

(782) (474) (2,766) (477)

Net income, as adjusted (non-GAAP) $ 172,846 $ 134,415 $ 341,736 $ 240,481

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Represents the change in legal reserves and settlement charges included in professional and legal fees.

Included in gains on securities transactions, net.

Included in gains (losses) on securities transactions, net.

Calculated using the appropriate blended statutory tax rate for the applicable period.

In addition to the items used to calculate net income, as adjusted, in the table above, our net income is, from time to time, impacted by fluctuations in the overall level of capital markets fees, wealth management and trust fees, and net gains on sales of loans.

These amounts can vary widely from period to period due to, among other factors, commercial loan customer demand for certain interest rate swap products, brokerage and tax credit investment advisory activities and the amount and timing of residential mortgage loans originated for sale.

In addition to the items used to calculate net income, as adjusted, in the table above, our net income is, from time to time, impacted by fluctuations in the overall level of capital markets income, wealth management and trust fees, and net gains on sales of loans.

These amounts can vary widely from period to period due to, among other factors, commercial loan customer demand for certain interest rate swap products, brokerage and tax credit investment

advisory activities and the amount and timing of residential mortgage loans originated for sale.

See the “Non-Interest Income” section below for more details.

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Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

($ in thousands)

4 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

($ in thousands)

4 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

($ in thousands)

1 unchanged sentence

Amortization of other intangible assets (net of tax), other than loan servicing rights 4,247 5,120 8,993 10,739

Net income available to common shareholders excluding intangible amortization (GAAP) 161,442 104,722

Net income available to common shareholders excluding intangible amortization (non-GAAP) 167,816 131,339 329,258 236,061

Average shareholders’ equity (GAAP) $ 7,901,688 $ 7,524,231 $ 7,878,746 $ 7,491,395

Average preferred shareholders equity 354,345 354,345 354,345 354,345

Average goodwill and other intangible assets 1,858,851 1,859,614

Average goodwill (net of deferred tax liability) 1,858,851 1,859,614 1,858,851 1,859,614

Average intangible assets (net of deferred tax liability), other than loan servicing rights 51,387 69,367 54,218 72,748

8 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

($ in thousands)

1 unchanged sentence

Restructuring charge (pre-tax) (1)

2,513 800 8,202 800

Amortization of tax credit investments (pre-tax) 16,157 9,134 32,171 18,454

Litigation reserve (pre-tax) (2)

230 — 1,492 —

Loss on extinguishment of debt (pre-tax) — 922 — 922

Total non-interest expense, as adjusted (non-GAAP) $ 292,223 $ 273,266 $ 579,184 $ 540,564

6 unchanged sentences

Represents the change in legal reserves and settlement charges included in professional and legal fees.

Included in gains on securities transactions, net.

Included in gains (losses) on securities transactions, net.

Tangible book value per common share is computed by dividing shareholders’ equity less preferred stock, goodwill and other intangible assets by common shares outstanding, as follows:

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Net Interest Income

Net interest income on a tax equivalent basis of $472.8 million for the first quarter 2026 increased $6.7 million and $51.4 million compared to the fourth quarter 2025 and the first quarter 2025, respectively, largely resulting from a decline in the cost of average deposits and, to a lesser extent, lower average long-term borrowings and additional interest income from higher average overnight interest bearing cash balances.

Interest income on a tax equivalent basis decreased $13.0 million to $804.0 million for the first quarter 2026 as compared to the fourth quarter 2025.

The decrease was mostly the result of two fewer days in the first quarter 2026 and downward repricing of adjustable rate loans, partially offset by the additional interest income from interest bearing cash balances in the first quarter 2026.

Total interest expense decreased $19.7 million to $331.2 million for the first quarter 2026 as compared to the fourth quarter 2025.

The decrease was mainly the result of lower costs on most interest bearing deposit products and the maturity and repayment of higher-cost time deposits as well as certain long-term borrowings during the first quarter 2026.

Average interest earning assets increased $2.8 billion to $59.7 billion for the first quarter 2026 as compared to the first quarter 2025 largely due to growth in our loan and investment securities portfolios over the last 12 month period.

Compared to the fourth quarter 2025, average interest earning assets increased by $1.0 billion during the

first quarter 2026.

The increase was primarily driven by the commercial loan growth and higher levels of excess overnight interest bearing cash balances during the first quarter 2026 supported by funding from solid growth in direct customer deposits.

Average interest bearing liabilities increased $2.1 billion and $848.6 million to $43.4 billion for the first quarter 2026 as compared to the first and fourth quarters 2025, respectively.

These increases were primarily due to higher average savings, NOW and money market deposits driven by strong deposit inflows from commercial customers, partially offset lower time deposit balances and average FHLB advances within both long- and short-term borrowings.

Net interest income on a tax equivalent basis of $488.4 million for the second quarter 2026 increased $15.6 million and $54.7 million compared to the first quarter 2026 and the second quarter 2025, respectively.

Interest income on a tax equivalent basis increased $26.7 million to $830.7 million for the second quarter 2026 as compared to the first quarter 2026.

The increase was mostly due to (i) increased average loan balances largely driven by growth in commercial and industrial loans and owner occupied commercial real estate loans during the first half of 2026, (ii) additional interest income from purchases of higher-yielding taxable investments and (iii) one additional day in the second quarter 2026.

Total interest expense increased $11.2 million to $342.4 million for the second quarter 2026 as compared to the first quarter 2026.

The increase was mainly the result of (i) higher average time deposits and short-term borrowings balances during the second quarter 2026, (ii) the higher cost of certain non-maturity deposit

products and short-term borrowings, (iii) the cost of carrying excess subordinated debt for a portion of the quarter, as well as (iv) the aforementioned increase in day count as compared to the first quarter 2026.

Average interest earning assets increased $3.5 billion to $61.1 billion for the second quarter 2026 as compared to the second quarter 2025 largely due to growth in our loan and investment securities portfolios over the last 12 month period.

Compared to the first quarter 2026, average interest earning assets increased by $1.3 billion during the second quarter 2026.

The increase was primarily driven by the commercial loan growth and higher average taxable investments balances, partially offset by lower levels of overnight interest bearing cash balances during the second quarter 2026.

Average interest bearing liabilities increased $2.2 billion to $44.2 billion for the second quarter 2026 as compared to the second quarter 2025 primarily due to strong deposit inflows from commercial customers over the last 12 months within the savings, NOW and money market deposits category, partially offset by lower indirect customer deposit balances.

Compared to the first quarter 2026, average interest bearing liabilities increased by $808.1 million during the second quarter 2026, mostly due to increases within time deposits and short-term borrowings.

See additional information under “Deposits and Other Borrowings” in the Executive Summary section above.

Net interest margin on a tax equivalent basis of 3.17 percent for the first quarter 2026 remained unchanged as compared to the fourth quarter 2025 and increased 21 basis points from 2.96 percent for the first quarter 2025.

The yield on average interest earning assets decreased by 17 basis points to 5.39 percent on a linked quarter basis largely due to downward repricing of our adjustable rate loans and the lower yield on overnight interest bearing cash balances, partially offset by the higher level of yields on new loans and investment securities during the first quarter 2026.

The overall cost of average interest bearing liabilities decreased by 24 basis points to 3.06 percent for the first quarter 2026 as compared to the fourth quarter 2025 largely due to disciplined management of our deposit pricing in the current market environment and rotation towards lower-cost core customer deposits.

Our cost of total average deposits was 2.27 percent for the first quarter 2026 as compared to 2.45 percent and 2.65 percent for the fourth quarter 2025 and first quarter 2025, respectively.

Net interest margin on a tax equivalent basis of 3.20 percent for the second quarter 2026 increased 3 basis points from 3.17 percent for the first quarter 2026 and 19 basis points from 3.01 percent for the second quarter 2025.

The yield on average interest earning assets increased by 5 basis points to 5.44 percent on a linked quarter basis largely due to higher yields on new loan originations and investment securities purchased during the second quarter 2026.

The overall cost of average interest bearing liabilities increased by 4 basis points to 3.10 percent for the second quarter 2026 as compared to the first quarter 2026 largely due to the higher cost of non-maturity deposits and short-term borrowings, as well as carrying excess subordinated debt for a portion of the quarter.

Our cost of total average deposits was 2.28 percent for the second quarter 2026 as compared to 2.27 percent and 2.67 percent for the first quarter 2026 and second quarter 2025, respectively.

We currently anticipate net interest income growth for the full year of 2026 to be at the high end of the 11 to 13 percent range previously disclosed in Valley's Annual Report.

The net interest margin is expected to exceed 3.30 percent by the end of 2026 as we continue to benefit from loan growth and repricing.

While we are optimistic about the projected net interest income for the remainder of 2026, our forecasts include several uncertain assumptions, including projected loan growth and our ability to decrease funding costs over the next nine months.

Therefore, we cannot provide any assurances that our future net interest income or margin will meet our current estimates or remain near the levels reported for the first quarter 2026.

Therefore, we cannot provide any assurances that our future net interest income or margin will meet our current estimates or remain near the levels reported for the second quarter 2026.

For a detailed discussion on the risks related to interest rates please refer to Part I, Item 1A.

“Risk Factors” in Valley's Annual Report.

The following table reflects the components of net interest income for the three months ended March 31, 2026, December 31, 2025 and March 31, 2025:

The following table reflects the components of net interest income for the three months ended June 30, 2026, March 31, 2026 and June 30, 2025:

Quarterly Analysis of Average Assets, Liabilities and Shareholders’ Equity and

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Three Months Ended

March 31, 2026 December 31, 2025 March 31, 2025

June 30, 2026 March 31, 2026 June 30, 2025

Balance Interest Average

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3.20 % 3.17 % 3.01 %

The following table reflects the components of net interest income for the six months ended June 30, 2026 and 2025:

Six Months Ended

June 30, 2026 June 30, 2025

Average Balance Interest Average Rate Average Balance Interest Average Rate

($ in thousands)

Interest earning assets:

$ 51,079,250 $ 1,444,744 5.66 % $ 48,844,823 $ 1,423,936 5.83 %

Taxable investments (3)

7,830,983 160,492 4.10 7,226,565 142,254 3.94

Tax-exempt investments (1)(3)

543,572 12,362 4.55 548,274 11,877 4.33

Interest bearing deposits with banks 938,016 17,141 3.65 604,824 14,236 4.71

Total interest earning assets 60,391,821 1,634,739 5.41 57,224,486 1,592,303 5.57

Allowance for credit losses (596,380) (585,749)

Cash and due from banks 349,824 423,393

Other assets 4,845,862 4,906,634

Unrealized losses on securities available for sale, net (99,821) (162,150)

Total assets $ 64,891,306 $ 61,806,614

Liabilities and shareholders’ equity

Interest bearing liabilities:

Savings, NOW and money market deposits $ 29,061,233 $ 381,758 2.63 % $ 26,399,580 $ 403,611 3.06 %

Time deposits 11,555,879 219,371 3.80 11,846,625 254,393 4.29

Total interest bearing deposits 40,617,112 601,129 2.96 38,246,205 658,004 3.44

Short-term borrowings 374,616 6,283 3.35 251,757 4,682 3.72

Long-term borrowings (4)

2,766,675 66,138 4.78 3,076,770 74,565 4.85

Total interest bearing liabilities 43,758,403 673,550 3.08 41,574,732 737,251 3.55

Non-interest bearing deposits 12,158,837 11,279,752

Other liabilities 1,095,320 1,460,735

Shareholders’ equity 7,878,746 7,491,395

Total liabilities and shareholders’ equity $ 64,891,306 $ 61,806,614

Net interest income/interest rate spread (5)

$ 961,189 2.33 % $ 855,052 2.02 %

Tax equivalent adjustment (2,640) (2,539)

Net interest income, as reported $ 958,549 $ 852,513

Net interest margin (6)

3.17 % 2.98 %

Tax equivalent effect 0.01 0.01

Net interest margin on a fully tax equivalent basis (6)

3.18 % 2.99 %

(1) Interest income is presented on a tax equivalent basis using a 21 percent federal tax rate.

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Change in Net Interest Income on a Tax Equivalent Basis

Three Months Ended March 31, 2026

Compared to March 31, 2025

Three Months Ended June 30, 2026

Compared to June 30, 2025 Six Months Ended June 30, 2026

Compared to June 30, 2025

Volume Change

Change Change

Volume Change

(in thousands)

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Non-Interest Income

Non-interest income represented 12.7 percent and 12.2 percent of total net interest income plus non-interest income for the three months ended March 31, 2026 and 2025, respectively.

For the three months ended March 31, 2026, non-interest income increased $10.5 million as compared to the first quarter 2025.

Non-interest income represented 13.1 percent and 12.6 percent of total net interest income plus non-interest income for the three months ended June 30, 2026 and 2025, respectively, and 12.9 percent and 12.4 percent of total net interest income plus non-interest income for the six months ended June 30, 2026 and 2025, respectively.

For the three and six months ended June 30, 2026, non-interest income increased $11.1 million and $21.6 million, respectively, as compared to the same periods in 2025.

See further details below.

The following table presents the components of non-interest income for the three months ended March 31, 2026 and 2025:

The following table presents the components of non-interest income for the three and six months ended June 30, 2026 and 2025:

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

(in thousands)

3 unchanged sentences

Service charges on deposit accounts 18,728 14,705 36,932 27,431

Gains on securities transactions, net 21 46

Gains (losses) on securities transactions, net 50 (1) 71 45

Fees from loan servicing 3,268 3,671 6,486 6,886

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Total non-interest income $ 73,711 $ 62,604 $ 142,547 $ 120,898

Capital markets income increased $3.4 million for the three months ended March 31, 2026 as compared to the first quarter 2025.

The increase was mostly due to fee income growth from higher volumes of interest rate swap transactions related to commercial lending activities.

Swap fee income totaled $6.4 million and $3.0 million for the three months ended March 31, 2026 as compared to the first quarter 2025.

Service charges on deposit accounts increased $5.5 million for the three months ended March 31, 2026 as compared to the first quarter 2025 mainly due to additional treasury management service related fees generated from commercial deposit accounts.

Bank owned life insurance income increased $1.1 million for the three months ended March 31, 2026 as compared to the first quarter 2025 largely driven by higher death benefits and, to a lesser extent, returns on the underlying investment securities during the first quarter 2026.

For the remainder of 2026, we plan to further leverage the investments that we have made in our treasury solutions, foreign exchange and syndication platforms, and continue to focus on growing revenues from service charges on deposits accounts, interest rate swap transactions and our broker dealer subsidiary.

Wealth management and trust fees income increased $3.6 million and $4.6 million for the three and six months ended June 30, 2026, respectively, as compared to the same periods in 2025.

The increases in both periods were mainly driven by higher asset management fees and increased brokerage commissions from stronger trading volume.

Brokerage fees increased $1.6 million and $3.3 million for the three and six months ended June 30, 2026, respectively, as compared to the same periods in 2025.

Capital markets income increased $3.2 million and $6.6 million for the three and six months ended June 30, 2026, respectively, as compared to the same periods in 2025.

The increase in both periods was mostly due to fee income growth from higher volumes of interest rate swap transactions related to commercial lending activities, as well as higher fees from loan participation and syndication transactions.

Swap fee income increased $1.6 million and $4.9 million for the three and six months ended June 30, 2026, respectively as compared to the same periods in 2025.

Service charges on deposit accounts increased $4.0 million and $9.5 million for the three and six months ended June 30, 2026, respectively, as compared to the same periods in 2025 mainly due to additional treasury management service related fees generated from commercial deposit accounts.

We are encouraged by the growth of our non-interest income during the first half of 2026.

Moving forward, we plan to further leverage our treasury management platform, capital markets capabilities, tax credit advisory services and broader commercial product set to deepen our customer relationships and generate additional high-quality, sustainable non-interest income.

Non-Interest Expense

Non-interest expense increased $33.3 million for the three months ended March 31, 2026 as compared to the first quarter of 2025 mainly due to increases in salary and employee benefits expense, professional and legal fees, amortization of tax credit investments and net occupancy expense.

Non-interest expense increased $27.0 million and $60.3 million for the three and six months ended June 30, 2026 , respectively, as compared to the same periods in 2025 mainly due to increases in salary and employee benefits expense, professional and legal fees, amortization of tax credit investments and net occupancy expense.

See further details below.

The following table presents the components of non-interest expense for the three months ended March 31, 2026 and 2025:

The following table presents the components of non-interest expense for the three and six months ended June 30, 2026 and 2025:

Three Months Ended

June 30, Six Months Ended

2026 2025 2026 2025

(in thousands)

6 unchanged sentences

Amortization of tax credit investments 16,157 9,134 32,171 18,454

Loss on extinguishment of debt — 922 — 922

Other 36,616 32,905 73,216 65,245

Total non-interest expense $ 311,123 $ 284,122 $ 621,049 $ 560,740

Salary and employee benefits expense increased $13.1 million for the three months ended March 31, 2026 as compared to the first quarter 2025 largely due to strategic investments in experienced commercial bankers and specialized technology resources and increased severance, cash incentive compensation and medical insurance related expenses.

Severance expense related to workforce reductions totaled $5.7 million three months ended March 31, 2026.

There was no severance expense related to workforce reductions for the three months ended March 31, 2025.

Net occupancy expense increased $1.3 million for the three months ended March 31, 2026 as compared to the same period in 2025 mainly due to incrementally higher cleaning and maintenance, building repairs and utilities expense.

Technology, furniture and equipment expense increased $2.0 million for the three months ended March 31, 2026 as compared to the first quarter 2025 mostly driven by increases in data processing fees and software licensing costs.

FDIC insurance assessment expense decreased $2.4 million for the three months ended March 31, 2026 as compared to the first quarter 2025.

The decrease was mostly due to a lower assessment rate resulting from a lower level of internally criticized and classified assets and higher cumulative net income since the first quarter 2025.

Professional and legal fees increased $9.5 million for the three months ended March 31, 2026 as compared to the first quarter 2025.

The increase was largely due to higher consulting fees related to enhancing our business operating model and other transformation efforts, as well as $1.2 million of expense related to litigation reserves and settlement charges during the first quarter 2026.

Overall, we expect the level of professional and legal fees to remain elevated during the second quarter 2026 due to ongoing business transformation activities.

Amortization of other intangibles decreased $1.1 million for the three months ended March 31, 2026 as compared to the same period of 2025 mainly due to a normal decline in amortization expense related to core deposits.

Amortization of tax credit investments increased $6.7 million for the three months ended March 31, 2026 as compared to the first quarter 2025 mainly due to additional purchases of tax-advantaged investments over the last 12 month period.

Salary and employee benefits expense increased $5.0 million and $18.1 million for the three and six months ended June 30, 2026 , respectively, as compared to the same periods in 2025.

The increase for the three months ended June 30, 2026 was mainly due to increases in severance, stock-based compensation, and medical insurance expenses.

The increase for the six months ended June 30, 2026 was mostly due to increases in severance, cash incentive and stock-based compensation, and medical insurance expenses, as well as annual salary increases.

Severance expense related to workforce reductions totaled $2.5 million and $8.2 million for the three and six

months ended June 30, 2026, respectively, as compared to $800 thousand for both the three and six months ended June 30, 2025.

Net occupancy expense increased $1.7 million and $3.0 million for the three and six months ended June 30, 2026, respectively, as compared to the same periods in 2025 mainly due to incrementally higher property tax, building repairs and utilities expenses, partially offset by lower rent expense.

Technology, furniture and equipment expense increased $2.6 million and $4.6 million for the three and six months ended June 30, 2026, respectively, as compared to the same periods in 2025 mostly driven by increases in data processing fees and software licensing costs, partially offset by lower depreciation expense.

FDIC insurance assessment expense decreased $2.9 million for the six months ended June 30, 2026 as compared to the same period in 2025 due to a lower assessment rate mostly resulting from a decline in our internally criticized and classified assets.

Professional and legal fees increased $9.6 million and $19.0 million for the three and six months ended June 30, 2026 , respectively, as compared to the same periods in 2025.

The increases for both periods were largely due to higher third party managed services and consulting fees related to enhancing our business operating model and other transformation efforts.

Additionally, the increase for the six months ended June 30, 2026 included $1.5 million of expense related to litigation reserves and settlement charges during the first half of 2026.

Overall, we expect the level of professional and legal fees to remain generally elevated during the third quarter 2026 due to ongoing business transformation activities.

Amortization of other intangibles decreased $1.2 million and $2.3 million for the three and six months ended June 30, 2026, respectively, as compared to the same periods of 2025 mainly due to a normal decline in amortization expense related to core deposits.

Amortization of tax credit investments increased $7.0 million and $13.7 million for the three and six months ended June 30, 2026, respectively, as compared to the same periods in 2025 mainly due to additional purchases of tax-advantaged investments over the last 12 month period.

See Note 14 for more details regarding our tax credit investments.

Other non-interest expense increased $4.3 million for the three months ended March 31, 2026 as compared to the first quarter 2025 due, in part, to a $3.2 million increase in advertising expense related to Valley's new brand campaign.

Income tax expense totaled $45.3 million for the first quarter 2026 as compared to $26.3 million for the fourth quarter 2025 and $33.1 million for the first quarter 2025.

Our effective tax rate was 21.6 percent, 11.9 percent and 23.8 percent for the first quarter 2026, fourth quarter 2025 and first quarter 2025, respectively.

Our effective tax rate largely normalized during the first quarter 2026 as compared to the linked quarter due to an $11.4 million tax refund benefit realized in the fourth quarter 2025 related to the closure of a federal audit.

The moderate decrease in the effective tax rate for the first quarter 2026 as compared to first quarter 2025 was primarily due to larger investment in tax credits.

Other non-interest expense increased $3.7 million and $8.0 million for the three and six months ended June 30, 2026, respectively, as compared to the same periods in 2025.

The increases for both periods were mainly due to an increase in advertising expense related to Valley's brand campaign, higher travel and entertainment expenses, as well as incremental increases in other operating expenses due to growth in our business.

Income tax expense totaled $49.6 million for the second quarter 2026 as compared to $45.3 million for the first quarter 2026 and $39.9 million for the second quarter 2025.

Our effective tax rate was 22.5 percent, 21.6 percent and 23.1 percent for the second quarter 2026, first quarter 2025 and second quarter 2025, respectively.

The increase in our effective tax rate for the second quarter 2026 as compared to the linked quarter was primarily attributable to the impact of discrete tax benefits realized in the first quarter 2026 related to vesting of stock awards.

The decrease in the effective tax rate for the second quarter 2026 as compared to second quarter 2025 was primarily due to larger investment in tax credits.

GAAP requires that any change in judgment or change in measurement of a tax position taken in a prior annual period be recognized as a discrete event in the quarter in which it occurs, rather than being recognized as a change in effective tax rate for the current year.

9 unchanged sentences

See Note 1 5 to the consolidated financial statements for additional details.

The following tables present the financial data for Valley's operating segments, and Treasury and Corporate Other for the three months ended March 31, 2026 and 2025:

Three Months Ended March 31, 2026

The following tables present the financial data for Valley's operating segments, and Treasury and Corporate Other for the three months ended June 30, 2026 and 2025:

Three Months Ended June 30, 2026

Banking Commercial

6 unchanged sentences

Net interest income 74,540 369,262 43,222 487,024

Provision for credit losses 1,206 20,039 11 21,256

Provision (credit) for credit losses 1,291 27,875 (2) 29,164

Net interest income after provision for credit losses 73,249 341,387 43,224 457,860

12 unchanged sentences

Net interest margin 2.61 % 3.66 % 1.89 % 3.19 %

Three Months Ended March 31, 2025

Three Months Ended June 30, 2025

Banking Commercial

6 unchanged sentences

Net interest income 61,701 339,898 30,809 432,408

Provision (credit) for credit losses (8,733) 71,408 (14) 62,661

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

6 unchanged sentences

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

6 unchanged sentences

Consumer Banking Segment

The Consumer Banking segment represented 19.8 percent of our loan portfolio at March 31, 2026, and was mainly comprised of residential mortgage loans and automobile loans, and to a lesser extent, business purpose loans to wealth management clients, home equity loans, secured personal lines of credit and other consumer loans (including credit card loans).

The duration of the residential mortgage loan portfolio (which represented 11.5 percent of our loan portfolio at March 31, 2026) is subject to movements in the market level of interest rates and forecasted prepayment speeds.

The weighted average life of the automobile loans portfolio (which represented 4.3 percent of total loans at March 31, 2026) is relatively unaffected by movements in the market level of interest rates.

The Consumer Banking segment represented 19.4 percent of our loan portfolio at June 30, 2026, and was mainly comprised of residential mortgage loans and automobile loans, and to a lesser extent, business purpose loans to wealth management clients, home equity loans, secured personal lines of credit and other consumer loans (including credit card loans).

The duration of the residential mortgage loan portfolio (which represented 11.4 percent of our loan portfolio at June 30, 2026) is subject to movements in the market level of interest rates and forecasted prepayment speeds.

The weighted average life of the automobile loans portfolio (which represented 4.1 percent of total loans at June 30, 2026) 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 our international and domestic private banking businesses.

Consumer Banking’s average interest earning assets increased $1.1 billion to $11.3 billion for the first quarter 2026 as compared to the same period of 2025.

The increase was mostly due to the steady growth in both the residential mortgage and automobile loan portfolios and targeted growth in lending to private banking clients over the last 12-month period.

Consumer Banking’s average interest earning assets increased $1.0 billion to $11.4 billion for the second quarter 2026 as compared to the same period of 2025.

The increase was mostly due to the steady growth in both the residential mortgage and targeted growth in lending to private banking clients over the last 12-month period.

See additional details in the “Loan Portfolio” section of this MD&A.

Income before income taxes generated by the Consumer Banking segment increased $145 thousand to $37.5 million for the first quarter 2026 as compared to the first quarter 2025.

Net interest income for this segment increased $16.1 million mainly due to the increase in average loans coupled with a decline in our funding costs.

The provision for credit losses increased $9.9 million to $1.2 million for the first quarter 2026 as compared to negative (credit) provision totaling $8.7 million the first quarter 2025.

The continued low level of the provision during the first quarter 2026 continues to reflect the actual and expected strong credit performance in the residential and consumer loan portfolios.

Non-interest income decreased $3.2 million as compared to the first quarter 2025 largely due to lower trust and investment service fees and insurance commissions.

Non-interest expense increased $2.8 million for the first quarter 2026 largely due to higher professional and legal fees related to business transformation efforts and increased salary and employee benefits expense and medical insurance related expenses.

See further details in the “Non-Interest Income” section of this MD&A.

Net interest margin on the Consumer Banking portfolio increased 35 basis points to 2.59 percent for the first quarter 2026 as compared to the first quarter 2025 mainly due to a 34 basis point decrease in the costs associated with our funding sou rces combined with a 1 basis point increase in the yield on average loans.

The decrease in our funding costs was mainly the result of lower interest rates on most deposit products during the first quarter 2026 as compared to one year ago, as well as the repayment of maturing higher cost time deposits over the last 12-month period.

Income before income taxes generated by the Consumer Banking segment decreased $95 thousand to $31.7 million for the second quarter 2026 as compared to the second quarter 2025.

Net interest income for this segment increased $12.8 million mainly due to additional interest income for higher average loan balances coupled with a decline in our funding costs compared to one year ago.

Non-interest income increased $2.2 million as compared to the second quarter 2025 largely due to higher wealth management and trust fees.

Non-interest expense increased $14.6 million

for the second quarter 2026 mostly due to higher professional and legal fees related to business transformation efforts.

See further details in the “Non-Interest Income” and “Non-Interest Expense” section of this MD&A.

Net interest margin on the Consumer Banking portfolio increased 24 basis points to 2.61 percent for the second quarter 2026 as compared to the second quarter 2025 mainly due to a 40 basis point decrease in the costs associated with our funding sou rces, partially offset by a 16 basis point decrease in the yield on average loans.

The decrease in our funding costs was mainly the re sult of lower interest rates on most deposit products during the second quarter 2026 as compared to one year ago, as well as the repayment of maturing higher cost time deposits over the last 12-month period.

See the “Net Interest Income” section above for more details on our net interest margin and funding sources.

2 unchanged sentences

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.

Commercial and industrial loans totaled approximately $11.1 billion and represented 21.8 percent of the total loan portfolio at March 31, 2026.

Commercial real estate and construction loans totaled $29.7 billion and represented 58.4 percent of the total loan portfolio at March 31, 2026.

Average interest earning assets in the Commercial Banking segment increased $553.8 million to $39.0 billion for the first quarter 2026 as compared to the first quarter 2025.

The increase was mostly due to solid growth in commercial and industrial loans and, to a lesser extent, owner occupied commercial real estate loans, partially offset by our strategic runoff of certain non-relationship/transactional loans within the commercial real estate portfolio over the last 12-month period.

Commercial and industrial loans totaled approximately $12.0 billion and represented 22.8 percent of the total loan portfolio at June 30, 2026.

Commercial real estate and construction loans totaled $30.3 billion and represented 57.8 percent of the total loan portfolio at June 30, 2026.

Average interest earning assets in the Commercial Banking segment increased $1.8 billion to $40.4 billion for the second quarter 2026 as compared to the second quarter 2025.

The increase was mostly due to strong growth in commercial and industrial loans and owner occupied commercial real estate loans, partially offset by our strategic runoff of certain non-relationship/transactional loans within the commercial real estate portfolio over the last 12-month period.

See additional details in the “Loan Portfolio” section of this MD&A.

Income before income taxes for Commercial Banking increased $74.7 million to $178.9 million for the first quarter 2026 as compared to the same quarter in 2025 mainly due to a decrease in the provision for credit losses combined with higher net interest income and non-interest income.

The provision for credit losses decreased $51.4 million to $20.0 million as compared to the same period in 2025 mostly due to improved actual and expected performance within the loan portfolio as compared to one year ago.

Income before income taxes for Commercial Banking increased $39.8 million to $190.0 million for the second quarter 2026 as compared to the same quarter in 2025 mainly due to higher net interest income and non-interest income combined with a decrease in the provision for credit losses.

Net interest income increased $29.4 million

as compared to the same period a year ago largely due to lower funding costs and additional interest income from higher average loan balances.

Non-interest income increased $8.6 million during the second quarter 2026 mainly due to higher service charges on deposit accounts related to treasury management services and an increase in capital markets income from higher commercial loan swap fee transaction volumes.

The provision for credit losses decreased $9.2 million to $27.9 million as compared to the same period in 2025 mostly due to lower commercial and industrial loan charge-offs as compared to one year ago and a decline in quantitative reserves largely within certain commercial real estate loan categories.

See more information in the “Allowance for Credit Losses for Loans” section of this MD&A.

Non-interest income increased $12.2 million during the first quarter 2026 mainly due to higher service charges on deposit accounts related to treasury management services and an increase in capital markets income due to higher loan swap fee transaction volumes.

The positive impact of these items was partially offset by $10.9 million increase in non-interest expense, mainly driven by higher professional and legal expenses and incremental increases in other segment items.

The positive impact of these items was partially offset by a $7.3 million increase in non-interest expense mainly driven by higher professional and legal expenses and incremental increases in other segment items.

See further details in the “Non-Interest Income” and “Non-Interest Expense” sections of this MD&A.

The net interest margin for this segment increased 18 basis poin ts to 3.65 percent for the first quarter 2026 as compared to the first quarter 2025 due to a 34 basis point decrease in the cost of our funding sources, partially offset by a 16 basis point decrease in the yield on average loans caused, in part, by the lower repricing of adjustable interest rate loans.

The net interest margin for this segment increased 14 basis poin ts to 3.66 percent for the second quarter 2026 as compared to the second quarter 2025 due to a 35 basis point decrease in the cost of our funding sources, partially offset by a 21 basis point decrease in the yield on average loans caused, in part, by the lower repricing of adjustable interest rate loans.

Treasury and Corporate Other

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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.

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 allocations to the segments based on the nature of income and expense.

U nallocated items included in Treasury and Corporate Other mainly consist of net gains and losses on AFS and HTM securities transactions, amortization of tax credit investments, as well as non-core item, such as corporate restructuring charges.

Treasury and Corporate Other's average interest earning assets increased $1.2 billion to $9.5 billion for the first quarter 2026 compared to the same quarter in 2025 mostly resulting from additional purchases of residential mortgage-backed securities classified as AFS over the last 12-month period combined with a $595.5 million increase in average interest bearing cash held in overnight accounts.

For the first quarter 2026 , loss before income taxes totaled $7.2 million compared to $2.4 million for the same quarter in 2025.

The $4.8 million increase in the pre-tax loss from the first quarter 2025 was mainly driven by an increase in non-interest expense, partially offset by higher net interest income.

Non-interest expense increased $19.6 million to $56.5 million for the first quarter 2026 as compared to the same quarter in 2025 mainly due to increases in salary, including higher severance expenses and medical insurance expense, and the amortization of tax credit investments, and professional and legal fees.

Treasury and Corporate Other's average interest earning assets increased $652.2 million to $9.2 billion for the second quarter 2026 compared to the same quarter in 2025 mostly due to a $577.8 million increase in average taxable investments largely resulting from additional purchases of residential mortgage-backed securities classified as AFS over the last 12-month period combined with a $73.8 million increase in average interest bearing cash held in overnight accounts.

For the second quarter 2026, loss before income taxes totaled $1.2 million compared to $8.9 million for the same quarter in 2025.

The $7.6 million decrease in the pre-tax loss from the second quarter 2025 was mainly driven by an increase in net interest income, partially offset by higher non-interest expense.

Net interest income increased $12.4 million for the second quarter 2026 as compared to the same period of 2025 primarily due to additional interest income from higher average taxable investment balances.

Non-interest expense increased $5.1 million to $50.2 million for the second quarter 2026 as compared to the same quarter in 2025 mainly due to increases in the amortization of tax credit investments, salary and employee benefits expense, including severance charges, and professional and legal fees.

See further details in the “Non-Interest Expense” section of this MD&A.

Net interest income increased $13.3 million for the first quarter 2026 as compared to the same period of 2025 primarily due to additional interest on higher average taxable investments, and, to a lesser extent, average interest bearing cash balances.

Treasury and Corporate Other's net interest margin increased 37 basis points to 1.81 percent for the first quarter 2026 as compared to the first quarter 2025 due to a 34 basis point decrease in the cost of our funding sources and a 3 basis point increase in the yield on average interest earning assets.

Treasury and Corporate Other's net interest margin increased 44 basis points to 1.89 percent for the second quarter 2026 as compared to the second quarter 2025 due to a 35 basis point decrease in the cost of our funding sources and a 9 basis point increase in the yield on average interest earning assets.

The following tables present the financial data for Valley's operating segments and Treasury and Corporate Other for the six months ended June 30, 2026 and 2025:

Six Months Ended June 30, 2026

Banking Commercial

Banking Treasury and Corporate Other Total

($ in thousands)

Average interest earning assets $ 11,358,861 $ 39,720,389 $ 9,312,571 $ 60,391,821

Interest income $ 274,302 $ 1,167,802 $ 189,995 $ 1,632,099

Interest expense 126,685 443,002 103,863 673,550

Net interest income 147,617 724,800 86,132 958,549

Provision for credit losses 2,497 47,913 10 50,420

Net interest income after provision for credit losses 145,120 676,887 86,122 908,129

Non-interest income 65,602 64,795 12,150 142,547

Non-interest expense

Salary and employee benefits expense 65,925 204,100 36,122 306,147

Net occupancy expense 10,371 35,660 8,330 54,361

Technology, furniture and equipment expense 13,677 42,793 8,655 65,125

FDIC insurance assessment 4,929 17,238 — 22,167

Professional and legal fees 10,373 35,713 8,589 54,675

Other segment items * 36,261 37,287 45,026 118,574

Total non-interest expense 141,536 372,791 106,722 621,049

Income (loss) before income taxes $ 69,186 $ 368,891 $ (8,450) $ 429,627

Return on average interest earning assets (pre-tax) 1.22 % 1.86 % (0.18) % 1.42 %

Net interest margin 2.60 % 3.65 % 1.85 % 3.17 %

Six Months Ended June 30, 2025

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 %

* Other segment items include amortization of intangible assets, amortization of tax credit investments and other general operating expenses.

Consumer Banking Segment

The Consumer Banking segment's average interest earning assets increased $930.2 million to $11.4 billion for the six months ended June 30, 2026 as compared to the same period in 2025.

The increase was mostly due to strong growth in our residential mortgage loan portfolio and targeted growth in lending to private banking clients over the last 12-month period.

Income before income taxes generated by Consumer Banking for the six months ended June 30, 2026 was $69.2 million and remained relatively unchanged as compared to the same period in 2025.

Net interest income for this segment increased $28.9 million largely due to the aforementioned growth in average loans coupled with lower funding costs.

Non-interest expense increased $17.4 million for the six months ended June 30, 2026 as compared to the same period in 2025 mostly due to increases in professional and legal fees.

The provision for credit losses increased $10.5 million for the six months ended June 30, 2026 as compared to the same period in 2025 due, in part, to loan growth and higher qualitative reserves.

See further details in the “Non-Interest Expense” and “ Allowance for Credit Losses for Loans” sections of this MD&A.

Net interest margin on the Consumer Banking portfolio increased 33 basis points to 2.60 percent for the six months ended June 30, 2026 as compared to the same period in 2025 mainly due to a 35 basis point decrease in the costs associated with our funding sources, partially offset by a 2 basis point decrease in the yield on average loans.

The decrease in our funding costs was mainly caused by lower interest rates on most deposit products during the six months ended June 30, 2026, as well as the repayment of maturing higher cost time deposits over the last 12-month period.

See the “Net Interest Income” section above for more details on our net interest margin.

The return on average interest earning assets before income taxes for the Consumer Banking segment was 1.22 percent for the six months ended June 30, 2026 compared to 1.33 percent for the same period in 2025.

Commercial Banking Segment

Average interest earning assets in the Commercial Banking segment increased $1.3 billion to $39.7 billion for the six months ended June 30, 2026 as compared to the same period in 2025.

This increase was mostly due to our focused growth in commercial and industrial loans and owner occupied commercial real estate loans, partially offset by our strategic runoff of certain non-relationship/transactional loans within the commercial real estate portfolio over the last 12-month period.

See additional details in the “Loan Portfolio” section of this MD&A.

Income before income taxes for Commercial Banking increased $114.5 million to $368.9 million for the six months ended June 30, 2026 as compared to the same period in 2025 largely attributable to a lower provision for credit losses combined with an increase in net interest income.

The provision for credit losses decreased $60.6 million to $47.9 million for the six months ended June 30, 2026 as compared to the same period in 2025 mainly due to stronger actual and expected credit performance within the commercial loan portfolios reflected by, among other factors, the significant decline in net loan charge-offs as compared to the 2025 period, as well as an overall improvement in our economic outlook at June 30, 2026 as compared to June 30, 2025.

Net interest income for this segment increased $51.4 million to $724.8 million for the six months ended June 30, 2026 as compared to the same period in 2025 mainly due to lower cost of funding combined with additional interest income from higher average loan balances.

Non-interest income increased $20.8 million as compared to the same period in 2025 mostly due to growth in treasury management service fees on commercial deposit accounts and an increase in capital markets income due to higher commercial loan swap fee transaction volumes.

The positive impact of these items was partially offset by an $18.3 million increase in non-interest expense mainly driven by higher professional and legal expenses and incremental increases in other segment items.

See det ails in the “Allowance for Credit Losses for Loans” and “Non-Interest Income” and “Non-Interest Expense” sections of this MD&A.

The net interest margin for this segment increased 15 basis points to 3.65 percent for the six months ended June 30, 2026 as compared to the same period in 2025 mainly due to a 35 basis point decrease in the cost of our funding sources that was partially offset by a 20 basis point decrease in the yield on average loans.

The return on average interest earning assets before income taxes for the commercial banking segment was 1.86 percent for the six months ended June 30, 2026 compared to 1.32 percent for the same period in 2025.

Treasury and Corporate Other

Treasury and Corporate Other's average interest earning assets increased $932.9 million during the six months ended June 30, 2026 primarily due to increases of $599.7 million and $333.2 million in average investment securities and interest bearing cash held in overnight accounts, respectively.

The loss before income taxes totaled $8.5 million for the six months ended June 30, 2026 as compared to $11.3 million for the same period in 2025.

The $2.8 million decrease in pre-tax loss was due to an increase in net interest income mostly resulting from additional interest income from growth in our investment securities portfolio, largely offset by higher non-interest expense.

Non-interest expense increased $24.7 million to $106.7 million for the six months ended June 30, 2026 as compared to the same period in 2025 primarily due to increases in salary and employee benefits expense, including higher severance expenses, amortization of tax credit investments, and professional and legal fees.

See further details in the “Non-Interest Expense” section of this MD&A.

Treasury and Corporate Other's net interest margin increased 41 basis points to 1.85 percent for the six months ended June 30, 2026 as compared to the same period in 2025 due to a 35 basis point decrease in the cost of our funding sources coupled with a 6 basis point increase in the yield on average investments.

The increase in the yield on average investments as compared to the same period in 2025 was largely driven by the purchases of new higher-yielding investments over the last 12-month period.

ASSET/LIABILITY MANAGEMENT

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Interest rate risk can be defined as the exposure of our interest rate sensitive assets and liabilities to the movement in interest rates.

Our Asset/Liability Management Committee is responsible for managing such risks and establishing policies that monitor and coordinate our sources and uses of funds.

Our Asset and Liability Management Committee is responsible for managing such risks and establishing policies that monitor and coordinate our sources and uses of funds.

Asset/Liability management is a continuous process due to the constant change in interest rate risk factors.

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The model is based on the actual maturity and re-pricing characteristics of rate sensitive assets and liabilities.

The model incorporates certain assumptions which management believes to be reasonable regarding the impact of changing interest rates, non-maturity deposit betas, and the prepayment assumptions of certain assets and liabilities as of March 31, 2026.

The model assumes immediate changes in interest rates without any proactive change in the composition or size of the balance sheet, or other future actions that management might undertake to mitigate this risk.

In the model, the forecasted shape of the yield curve remains static as of March 31, 2026.

In the model, the forecasted shape of the yield curve remains static as of June 30, 2026.

The impact of interest rate derivatives, such as interest rate swaps, is also included in the model.

Our simulation model is based on market interest rates and prepayment speeds prevalent in the market as of March 31, 2026.

Although the size of Valley’s balance sheet is forecast to remain static as of March 31, 2026, in our model, the composition is adjusted to reflect new interest earning assets and funding originations coupled with rate spreads utilizing our actual originations during the first quarter 2026.

The model utilizes an immediate parallel shift in market interest rates at March 31, 2026.

Our simulation model is based on market interest rates and prepayment speeds prevalent in the market as of June 30, 2026.

Although the size of Valley’s balance sheet is forecast to remain static as of June 30, 2026, in our model, the composition is adjusted to reflect new interest earning assets and funding originations coupled with rate spreads utilizing our actual originations during the second quarter 2026.

The model utilizes an immediate parallel shift in market interest rates at June 30, 2026.

The assumptions used in the net interest income simulation are inherently uncertain.

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As noted in the table above, a 100 basis point immediate decrease in interest rates combined with a static balance sheet where the size, mix, and proportions of assets and liabilities remain unchanged, is projected to decrease net interest income over the next 12-month period by 1.11 percent.

Management believes the interest rate sensitivity of our balance sheet remains within a n expected t olerance range at March 31, 2026.

Management believes the interest rate sensitivity of our balance sheet remains within a n expected t olerance range at June 30, 2026.

However, the level of net interest income sensitivity may increase or decrease in the future as a result of several factors, including potential changes in our balance sheet strategies, the slope of the yield curve and projected cash flows.

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Management maintains flexibility to temporarily exceed these internal limits in certain operating environments, but also strives to outperform these limits when possible.

The Bank was in compliance with the foregoing policies at March 31, 2026 and December 31, 2025, as summarized in the table below .

The following table presents Valley's loans to deposits and wholesale funding to total funding ratios at March 31, 2026 and December 31, 2025:

The Bank was in compliance with the foregoing policies at June 30, 2026 and December 31, 2025, as summarized in the table below .

The following table presents Valley's loans to deposits and wholesale funding to total funding ratios at June 30, 2026 and December 31, 2025:

2026 December 31,

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Interest bearing deposits with banks 578,148 1,268,399

Trading debt securities 26,493 —

Held to maturity debt securities (1)

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(1) Represents securities that are maturing within 90 days or would otherwise qualify as maturities if sold (i.e., 85 percent of original cost basis has been repaid) within the held to maturity debt security portfolio.

(2) Includes a pproximately $1.1 billion and $1.3 billion of various investment securities that were pledged to counterparties to support our earning asset funding strategies at March 31, 2026 and December 31, 2025, respectively.

Total liquid assets represented 9.4 percent and 10.3 percent of interest earning assets at March 31, 2026 and December 31, 2025, respectively.

T he level of cash liquidity on the balance sheet (as shown in the table above) decreased from December 31, 2025 to a more normalized level at March 31, 2026 partially due to our management of expected period end funding activities in the first quarter 2026 .

(2) Includes a pproximately $1.0 billion and $1.3 billion of various investment securities that were pledged to counterparties to support our earning asset funding strategies at June 30, 2026 and December 31, 2025, respectively.

Total liquid assets represented 9.1 percent and 10.3 percent of interest earning assets at June 30, 2026 and December 31, 2025, respectively.

T he level of cash liquidity on the balance sheet (as shown in the table above) decreased from December 31, 2025 to a more normalized level at June 30, 2026 partially due to our management of expected period end funding activities in the first half of 2026.

Other sources of funds on the asset side are derived from scheduled loan payments of principal and interest, as well as prepayments received.

At March 31, 2026, estimated cash inflows from total loans are projected to be approximatel y $14.1 billion over the next 12-month period.

At June 30, 2026, estimated cash inflows from total loans are projected to be approximatel y $14.2 billion over the next 12-month period.

As a contingency plan for any liquidity constraints, liquidity could also be derived from the sale of conforming residential mortgages from our loan portfolio or alleviated from the temporary curtailment of lending activities.

We anticipate the receipt of approximately $996.2 million in principal payments from securities in the total investment portfolio at March 31, 2026 over the next 12-month period due to normally scheduled principal repayments and expected prepayments of certain securities, primarily residential mortgage-backed securities.

We anticipate the receipt of approximately $962.7 million in principal payments from securities in the total investment portfolio at June 30, 2026 over the next 12-month period due to normally scheduled principal repayments and expected prepayments of certain securities, primarily residential mortgage-backed securities.

On the liability side of the balance sheet, we utilize multiple sources of funds to meet liquidity needs, including commercial and consumer deposits, fully FDIC-insured indirect customer deposits, collateralized municipal deposits, and short-term and long-term borrowings.

Our core deposit base, which generally excludes all fully insured indirect customer deposits, as well as retail certificates of deposit over $250 thousand, represents the largest of these source s.

Average core deposits totaled approximately $46.1 billion and $42.4 billion for the three months ended March 31, 2026 and for the year ended December 31, 2025, respectively, representing 77.2 percent and 73.1 percent of average interest earning assets for the respective periods.

Average core deposits totaled approximately $46.0 billion and $42.4 billion for the six months ended June 30, 2026 and for the year ended December 31, 2025, respectively, representing 76.2 percent and 73.1 percent of average interest earning assets for the respective periods.

The level of interest bearing deposits is affected by interest rates offered, which is often influenced by our need for funds, rates prevailing in the capital markets, competition, and the need to manage interest rate risk sensitivity.

In addition to customer deposits, the Bank has access to readily available borrowing sources to supplement its current and projected funding needs.

The following table presents short-term borrowings, consisting of securities sold under agreements to repurchase, outstanding at March 31, 2026 and December 31, 2025:

The following table presents short-term borrowings by type outstanding at June 30, 2026 and December 31, 2025:

2026 December 31, 2025

(in thousands)

FHLB advances $ 375,000 $ —

Securities sold under agreements to repurchase 58,484 91,475

The following table summarizes the Bank's estimated unused available non-deposit borrowing capacities at March 31, 2026 and December 31, 2025:

Total short-term borrowings $ 433,484 $ 91,475

The following table summarizes the Bank's estimated unused available non-deposit borrowing capacities at June 30, 2026 and December 31, 2025:

2026 December 31, 2025

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* Used and unused FHLB and FRB borrowings are collateralized by certain pledged securities, including but not limited to U.S.

government and agency mortgage-backed securities and blanket qualifying first lien on certain real estate and residential mortgage secured loans.

government and agency mortgage-backed securities and a blanket qualifying first lien on certain real estate and residential mortgage secured loans.

Corporation Liquidity

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Valley also has the right to defer interest payments on the junior subordinated debentures, and therefore distributions on its trust preferred securities for consecutive quarterly periods of up to five years, but not beyond the stated maturity dates, and subject to other conditions.

During the second quarter 2026, Valley issued $500 million of 6.219 percent fixed-to-floating rate subordinated notes and fully redeemed $300 million of callable subordinated notes originally due in June 2031.

See Note 10 to consolidated financial statements for further details.

Investment Securities Portfolio

As of March 31, 2026, we had $83.9 million, $4.2 billion and $3.6 billion in equity, AFS debt and HTM debt securities, respectively.

As of June 30, 2026, we had $88.5 million, $26.5 million, $4.3 billion and $3.8 billion in equity, trading debt, AFS debt and HTM debt securities, respectively.

The AFS and HTM debt securities portfolios, which comprise the majority of the securities we own, include:

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government agency securities, tax-exempt and taxable issuances of states and political subdivisions, residential mortgage-backed securities, single-issuer trust preferred securities principally issued by bank holding companies and high quality corporate bonds.

Among other securities, our AFS debt securities include securities such as bank issued and other corporate bonds, as well as municipal special revenue bonds, which may pose a higher risk of future impairment charges to us as a result of the uncertain economic environment and its potential negative effect on the future performance of the security issuers.

Among other securities, our AFS debt securities include securities such as bank issued and other corporate bonds, as well as

municipal special revenue bonds, which may pose a higher risk of future impairment charges to us as a result of the uncertain economic environment and its potential negative effect on the future performance of the security issuers.

The equity securities consist of two publicly traded mutual funds, CRA investments and several other equity investments that we have made in companies that develop new financial technologies and in partnerships that invest in such companies.

Our CRA and other equity investments are a mix of both publicly traded entities and privately held entities.

Trading debt securities consisted of U.S.

Treasury securities at June 30, 2026.

The primary purpose of our AFS and HTM investment portfolios is to provide a source of earnings and liquidity, as well as serve as a tool for managing interest rate risk.

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We continually evaluate our investment securities portfolio in response to established asset/liability management objectives, changing market conditions that could affect profitability, and the level of interest rate risk to which we are exposed.

These evaluations may cause us to change the level of funds we deploy into investment securities,

change the composition of our investment securities portfolio, and change the proportion of investments primarily made into the AFS and HTM debt securities portfolios.

These evaluations may cause us to change the level of funds we deploy into investment securities, change the composition of our investment securities portfolio, and change the proportion of investments primarily made into the AFS and HTM debt securities portfolios.

Allowance for Credit Losses and Impairment Analysis

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Declines in fair value that have not been recorded through an allowance for credit losses, such as declines due to changes in market interest rates, are recorded through other comprehensive income, net of applicable taxes.

We have evaluated all AFS debt securities that are in an unrealized loss position as of March 31, 2026 and December 31, 2025 and determined that the declines in fair value were mainly attributable to interest rates, credit spreads, market volatility and liquidity conditions, but not credit quality or other factors.

There was no impairment recognized within the AFS debt securities portfolio during the three months ended March 31, 2026 and 2025.

We have evaluated all AFS debt securities that are in an unrealized loss position as of June 30, 2026 and December 31, 2025 and determined that the declines in fair value were mainly attributable to interest rates, credit spreads, market volatility and liquidity conditions, but not credit quality or other factors.

There was no impairment recognized within the AFS debt securities portfolio during the three and six months ended June 30, 2026 and 2025.

We do not intend to sell any of the AFS debt securities in an unrealized loss position prior to recovery of our amortized cost basis, and we believe it is more likely than not that Valley will not be required to sell any of its securities prior to recovery of our amortized cost bas is.

None of the AFS debt securities w ere past due as of March 31, 2026 and there was no allowance for credit losses for AFS debt securities at March 31, 2026 and December 31, 2025 .

None of the AFS debt securities w ere past due as of June 30, 2026 and there was no allowance for credit losses for AFS debt securities at June 30, 2026 and December 31, 2025 .

Held to maturity debt securities.

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Treasury securities, U.S.

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

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, we utilize a third party discounted cash flow model.

The assumptions used in the model for pools of securities with common risk characteristics include the historical lifetime probability of default and severity of loss in the event of default, with the model incorporating several economic cycles of loss history data to calculate expected credit losses given default at the individual security level.

HTM debt securities were carried net of an allowance for credit losses totaling $746 thousand and $734 thousand at March 31, 2026 and December 31, 2025, respectively.

There were no net charge-offs of HTM debt securities during the three months ended March 31, 2026 and 2025.

HTM debt securities were carried net of an allowance for credit losses totaling $744 thousand and $734 thousand at June 30, 2026 and December 31, 2025, respectively.

There were no net charge-offs of HTM debt securities during the three and six months ended June 30, 2026 and 2025.

Investment grades.

The investment grades in the table below reflect the most current independent analysis performed by third parties of each security as of the date presented and not necessarily the investment grades at the date of our purchase of the securities.

For many securities, the rating agencies may not have performed an independent analysis of the tranches owned by us, but rather an analysis of the entire investment pool.

For many securities, the rating agencies may not have performed an

independent analysis of the tranches owned by us, but rather an analysis of the entire investment pool.

For this and other reasons, we believe the assigned investment grades may not accurately reflect the actual credit quality of each security and should not be viewed in isolation as a measure of the quality of our investment portfolio.

The following table presents the available for sale and held to maturity debt investment securities portfolios by investment grades at March 31, 2026:

March 31, 2026

The following table presents the available for sale and held to maturity debt investment securities portfolios by investment grades at June 30, 2026:

June 30, 2026

Losses Fair Value

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The unrealized losses in the AAA/AA/A rated categories of both the AFS and HTM debt securities portfolios (in the above table) were largely related to residential mortgage-backed securities issued by Ginnie Mae, Fannie Mae and Freddie Mac and continue to be driven by the higher level of market interest rates.

The investment securities AFS and HTM portfolios included investments with carrying values of $129.3 million and $183.8 million, respectively, at March 31, 2026 not rated by the rating agencies with aggregate unrealized losses of $4.7 million and $15.1 million, respectively.

The investment securities AFS and HTM portfolios included investments with carrying values of $133.6 million and $217.8 million, respectively, at June 30, 2026 not rated by the rating agencies with aggregate unrealized losses of $3.1 million and $13.2 million, respectively.

The unrealized losses within non-rated AFS debt securities mostly related to several large corporate bonds negatively impacted by rising interest rates and not changes in underlying credit.

The unrealized losses within non-rated HTM debt securities included three municipal bonds with a combined amortized cost of $32.8 million with $6.4 million o f gross unrealized losses and four single-issuer bank trust preferred issuances with amortized cost totaling $36.1 million with $5.2 million gross unrealized losses.

The unrealized losses within non-rated HTM debt securities included, but were not limited to, municipal bonds with a combined amortized cost of $39.3 million and $5.8 million o f gross unrealized losses and four single-issuer bank trust preferred issuances with a combined amortized cost of $36.1 million and $4.4 million of gross unrealized losses.

These HTM debt securities were negatively impacted by a higher level of market interest rates, and not changes in their underlying credit.

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The following table reflects the composition of the loan portfolio as of the dates presented:

2026 March 31,

2026 December 31,

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Total 100.0 % 100.0 % 100.0 %

Includes loans collateralized by properties that are greater than 50 percent rent regulated totaling approximately $583 million and $601 million at March 31, 2026 and December 31, 2025, respectively.

Includes net unearned discount and deferred loan fees of $15.9 million and $17.4 million at March 31, 2026 and December 31, 2025, respectively.

Total loans increased $692.1 million, or 5.5 percent on an annualized basis, to $50.8 billion at March 31, 2026 from December 31, 2025 mostly due to increases in owner occupied commercial real estate loans and commercial and industrial loans.

Loans held for sale decreased $15.0 million to $11.2 million at March 31, 2026 from December 31, 2025 due, in part, to the sale of a non-performing CRE loan relationship totaling $9.1 million to an unrelated party during the first quarter 2026.

The non-performing loan sale resulted in a net gain of $767 thousand recognized within net gains on sales of loans for the first quarter 2026.

Includes loans collateralized by properties that are greater than 50 percent rent regulated totaling approximately $559 million, $583 million and $601 million at June 30, 2026, March 31, 2026 and December 31, 2025, respectively.

Includes net unearned discounts and deferred loan fees of $19.9 million, $15.9 million and $17.4 million at June 30, 2026, March 31, 2026 and December 31, 2025, respectively.

See more details below.

Commercial and industrial loans.

Commercial and industrial loans increased by $142.6 million, or 5.2 percent on an annualized basis, to $11.1 billion at March 31, 2026 from December 31, 2025 largely driven by new originations from a wide range of relationship-driven small to midsize clients from our expanded lending team, as a result of our continued focus on certain specialty business lines, including healthcare lending.

Commercial and industrial loans increased by $857.2 million, or 30.9 percent on an annualized basis, to $12.0 billion at June 30, 2026 from March 31, 2026.

The increase was largely driven by broad-based growth across relationship-based small and middle-market commercial clients, primarily in New York, Florida, and Chicago, and loan originations within the Bank's specialty healthcare and fund finance lending.

Commercial real estate loans.

Commercial real estate loans (excluding construction loans) increased $451.8 million to $27.2 billion at March 31, 2026 from December 31, 2025 .

Owner occupied loans increased $502.3 million, or 30.3 percent on an annualized basis as compared to December 31, 2025 and continued to drive a disproportionate amount of growth within the commercial real estate loan portfolio during the first quarter 2026 as a result of our strategic focus on this category.

Non-owner occupied decreased $67.3 million at March 31, 2026 from December 31, 2025 largely driven by the continued targeted runoff of transactional loans that has outpaced our selective loan originations in this category.

Overall, commercial real estate loans are well-diversified mainly across our footprint areas in New York (including Manhattan), Florida, and New Jersey with a combined weighted average loan to value ratio of 59 percent and debt service coverage ratio of 1.66 at March 31, 2026.

Commercial real estate collateralized by office buildings totaled approximately $3.0 billion at March 31, 2026 and was relatively unchanged from December 31, 2025.

Our loans collateralized by office buildings had a combined weighted average loan to value ratio of 64 percent and debt service coverage ratio of 1.95 at March 31, 2026.

Commercial real estate loans (excluding construction loans) increased $649.1 million to $27.9 billion at June 30, 2026 from March 31, 2026 mainly driven by new owner occupied and select multifamily loan originations.

Owner occupied loans increased $560.6 million, or 31.4 percent on an annualized basis as compared to March 31, 2026 and continued to drive the growth within the commercial real estate loan

portfolio during the second quarter 2026 as a result of our strategic focus on this category.

Multifamily loans increased $445.7 million, or 20.8 percent on an annualized basis as compared to March 31, 2026.

Non-owner occupied loans decreased $357.2 million at June 30, 2026 from March 31, 2026 mainly due to our continued targeted runoff of transactional/non-relationship loans, which outpaced limited new originations in this category during the second quarter 2026.

Construction loans.

Construction loans increased only $14.2 million to $2.5 billion at March 31, 2026 from December 31, 2025 as we remained highly selective with new loan originations in this category.

Construction loans decreased $10.3 million to $2.5 billion at June 30, 2026 from March 31, 2026 as we remained highly selective with new loan originations in this category.

Residential mortgage loans.

Residential mortgage loans increased $42.9 million to $5.9 billion at March 31, 2026 from December 31, 2025 as new loan originations held for investment continued to outpace repayment activity.

New and refinanced residential mortgage loan originations totaled $194.8 million for the first quarter 2026 as compared to $222.6 million and $132.8 million for the fourth quarter 2025 and first quarter 2025, respectively.

We retained approximately 83 percent of the total residential mortgage originations in our held for investment loan portfolio during the first quarter 2026 compared to 78 percent in the fourth quarter 2025.

In addition, we purchased $11.9 million of loans from unrelated third party lenders for qualifying CRA purposes during the three months ended March 31, 2026.

Residential mortgage loans increased $113.9 million to $6.0 billion at June 30, 2026 from March 31, 2026 mainly due to continued retention of most new loan origination activity and modest levels of prepayments.

New and refinanced residential mortgage loan originations totaled $254.0 million for the second quarter 2026 as compared to $194.8 million and $204.1 million for the first quarter 2026 and second quarter 2025, respectively.

In addition, we purchased $30.7 million and $42.6 million of loans from unrelated third-party lenders for qualifying CRA purposes during the three and six months ended June 30, 2026, respectively.

Consumer loans .

Consumer loans increased $40.7 million, or 4.0 percent on an annualized basis, to $4.1 billion at March 31, 2026 as compared to December 31, 2025 due to growth across all consumer loan categories.

Within this portfolio, home equity loans increased $13.5 million, or 7.8 percent on an annualized basis, largely driven by new originations and, to a lesser extent, increased line usage.

Automobile loans increased by $13.5 million, or 2.5 percent on an annualized basis, to $2.2 billion at March 31, 2026 as compared to December 31, 2025 as indirect auto loan volumes from our dealership network outpaced repayment activity.

Auto loan originations totaled $275.0 million for the first quarter 2026 as compared to $248.2 million for the fourth quarter 2025.

Other consumer loans increased $13.7 million to $1.2 billion at March 31, 2026 as compared to December 31, 2025 primarily due to increased originations and usage of collateralized personal lines of credit.

A significant part of our lending is in northern and central Ne w Jersey, New York City, Long Island and Florida.

Consumer loans increased $28.5 million, or 2.8 percent on an annualized basis, to $4.2 billion at June 30, 2026 as compared to March 31, 2026 primarily due to the combined growth in home equity loans and other collateralized personal lines of credit, partially offset by a $48.0 million decrease in automobile loans.

Within this portfolio, home equity loans increased $27.5 million, or 15.7 percent on an annualized basis as compared to March 31, 2026, mostly due to higher line usage and, to a lesser extent, new originations as compared to the first quarter 2026.

Automobile loans decreased by $48.0 million, or 8.7 percent on an annualized basis, to $2.2 billion at June 30, 2026 as compared to March 31, 2026 mainly due to lower indirect auto loan origination volumes from our dealership network combined with higher repayment activity.

Auto loan originations totaled $217.1 million for the second quarter 2026 as compared to $275.0 million for the first quarter 2026.

Other consumer loans increased $49.1 million to $1.3 billion at June 30, 2026 as compared to March 31, 2026 primarily due to increased originations and usage of collateralized personal lines of credit.

A significant part of our lending is in northern and central New Jersey, New York City, Long Island and Florida.

To mitigate our geographic risks, we maintain a diversified portfolio across borrower types and loans to protect against potential downturns in any single sector.

Based on our current projections, we expect the total loan growth for the full year of 2026 to be between the midpoint and high-end of the 4 to 6 percent range previously disclosed in Valley's Annual Report.

Based on our current projections, we expect the total loan growth for the full year of 2026 to be at or above the high end of the 4 to 6 percent range previously disclosed in Valley's Annual Report.

However, there can be no assurance that we will achieve such growth levels given the potential for unforeseen changes in the market and other conditions detailed in our risk factors set forth under Item 1A.

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Non-performing Assets

NPAs include non-accrual loans, OREO, and other repossessed assets (which consist of automobiles and taxi medallions) at March 31, 2026.

NPAs include non-accrual loans, OREO, and other repossessed assets (which consist of automobiles and taxi medallions) at June 30, 2026.

Loans are generally placed on non-accrual status when they become past due more than 90 days as to payment of principal or interest and/or the full and timely collection of principal and interest becomes uncertain.

Exceptions to the non-accrual policy may be permitted if the loan is sufficiently collateralized

and in the process of collection.

Exceptions to the non-accrual policy may be permitted if the loan is sufficiently collateralized and in the process of collection.

OREO is acquired through foreclosure on loans secured by land or real estate.

OREO and other repossessed assets are reported at lower of cost or fair value, less estimated cost to sell.

Our NPAs modestly decreased $190 thousand to $439.6 million at March 31, 2026 as compared to December 31, 2025.

NPAs as a percentage of total loans and NPAs totaled 0.86 percent and 0.87 percent at March 31, 2026 and December 31, 2025, respectively (as shown in the table below).

Management believes that total NPAs at March 31, 2026 remain within credit quality expectations for the loan portfolio and continue to reflect Valley's consistent application of underwriting standards to both originated loans and loans purchased from third parties.

OREO and other repossessed assets are reported at the lower of cost or fair value, less estimated cost to sell.

Our NPAs increased $28.2 million to $467.8 million at June 30, 2026 as compared to March 31, 2026.

NPAs as a percentage of total loans and NPAs totaled 0.88 percent and 0.86 percent at June 30, 2026 and March 31, 2026, respectively (as shown in the table below).

Management believes that total NPAs at June 30, 2026 remain within credit quality expectations for the loan portfolio and continue to reflect Valley's consistent application of underwriting standards to both originated loans and loans purchased from third parties.

For additional details, see the “Credit Quality Indicators” section in Note 7 to the consolidated financial statements.

Our lending strategy is based on underwriting standards designed to maintain high credit quality, and we remain optimistic regarding the overall future performance of our loan portfolio.

During the three months ended March 31, 2026, the majority of our borrowers continued to demonstrate resilience despite the impact of elevated borrowing costs, inflation, labor costs and other factors.

During the six months ended June 30, 2026, the majority of our borrowers continued to demonstrate resilience despite the impact of elevated borrowing costs, inflation, labor costs and other factors.

We continue to proactively monitor our commercial loans for potential negative trends and borrower weakness due to the current operating environment, including the potential negative impact of volatile energy prices and tariffs/import fees, and internally risk rate them accordingly.

Based on our most recent portfolio review, we believe that we have relatively modest direct exposure to customer businesses most influenced by changing tariff/import fee policies and moderate periods of elevated energy prices.

However, management cannot provide assurance that the NPAs will not increase from the levels reported at March 31, 2026 due to the aforementioned or other factors potentially impacting our lending customers.

However, management cannot provide assurance that the NPAs will not increase from the levels reported at June 30, 2026 due to the aforementioned or other factors potentially impacting our lending customers.

The following table sets forth by loan category accruing past due and NPAs on the dates indicated in conjunction with our asset quality ratios:

2026 March 31,

2026 December 31,

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Commercial real estate 106,034 69,494 72,810

Construction 1,752 — —

Residential mortgage 22,154 20,534 21,615

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Total accruing past due and non-accrual loans as a % of loans

1.23 1.10 1.15

Allowance for loan losses as a % of non-accrual loans

127.66 135.10 134.44

Loans 30 to 59 days past due decreased $11.6 million to $108.4 million at March 31, 2026 as compared to December 31, 2025 largely due to lower delinquencies across all loan categories and a C&I loan relationship totaling $3.5 million that migrated from this past due category at December 31, 2025 to loans 90 days or more past due and still accruing at March 31, 2026.

Loans 60 to 89 days past due decreased $7.9 million to $8.8 million at March 31, 2026 as compared to December 31, 2025 primarily due to lower residential mortgage and consumer loan delinquencies caused, in part, by some modest migration of past due loans to loans 90 days or more past due and still accruing at March 31, 2026.

Loans 90 days or more past due and still accruing interest increased $6.1 million to $10.7 million at March 31, 2026 as compared to December 31, 2025 largely due to higher residential mortgage loans delinquencies and the migration

of the aforementioned C&I loan relationship from the 30 to 59 days past due delinquency category during the first quarter of 2026.

Loans 30 to 59 days past due increased $42.6 million to $151.0 million at June 30, 2026 as compared to March 31, 2026 mainly due to certain larger commercial real estate loans, partially offset by the migration of three commercial real estate loans totaling $49.6 million that migrated from this past due category at March 31, 2026 to non-accrual loans at June 30, 2026.

Loans 60 to 89 days past due increased $4.3 million to $13.1 million at June 30, 2026 as compared to March 31, 2026 mainly due to moderate increases in the residential mortgage and commercial and industrial loan categories.

Loans 90 days or more past due and still accruing interest increased $5.4 million to $16.1 million at June 30, 2026 as compared to March 31, 2026 primarily due to the second quarter 2026 migration of a $5.5 million commercial real estate loan previously reported in the 30 to 59 days past due delinquency category at March 31, 2026.

All loans 90 days or more past due and still accruing interest are well-secured and in the process of collection.

Non-accrual loans decreased $1.3 million to $432.6 million, or 0.85 percent of total loans at March 31, 2026 as compared to $433.9 million, or 0.87 percent of total loans, at December 31, 2025.

The decrease was primarily driven by a decline in non-accrual CRE loans, partially offset by higher non-accrual C&I and, to a lesser extent, residential mortgage loans.

Non-accrual CRE loans decreased $10.8 million at March 31, 2026 from December 31, 2025 mainly due to the sale of the $9.1 million non-performing loan relationship that was classified as held for sale at December 31, 2025.

Although the timing of collection is uncertain, management believes that the majority of the non-accrual loans at March 31, 2026 are well secured and largely collectable, based in part on our quarterly review of collateral dependent loans and the valuation of the underlying collateral, if applicable.

Non-accrual loans increased $30.0 million to $462.6 million, or 0.88 percent of total loans at June 30, 2026 as compared to $432.6 million, or 0.85 percent of total loans, at March 31, 2026.

The increase was mainly attributable to the aforementioned migration of commercial real estate loans from the 30 to 59 days past due delinquency category at March 31, 2026.

These three collateral dependent non-accrual commercial real estate loans totaled $49.6 million, net of partial charge-offs of $1.3 million during the second quarter 2026, and had no related allocated reserves within our allowance for credit losses for loans at June 30, 2026.

Although the timing of collection is uncertain, management believes that the majority of the non-accrual loans at June 30, 2026 are well secured and largely collectable, based in part on our quarterly review of collateral dependent loans and the valuation of the underlying collateral, if applicable.

Any estimated shortfall in the net realizable value for collateral dependent loans is charged-off when a loan is 90 or 120 days past due or sooner if it is probable that a loan may not be fully collectable.

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detailed statistical analyses.

We have identified and selected key variables that most closely correlated to our historical credit performance, which include GDP, unemployment and the Case-Shiller Home Price Index.

At March 31, 2026, Valley continued to maintain the majority of its probability weighting used in the economic forecast to the Moody’s Baseline scenario with slightly more emphasis on the S-3 downside scenario and a smaller percentage weighting on the S-1 upside scenarios as compared to December 31, 2025.

At March 31, 2026, the standalone Moody's Baseline scenario reflected more optimistic outlook as compared to December 31, 2025 for several metrics, including a few highlighted below.

At March 31, 2026, Moody's Baseline forecast included the following specific assumptions:

We have identified and selected key variables that most closely correlate to our historical credit performance, which include GDP, unemployment and the Case-Shiller Home Price Index.

At June 30, 2026, Valley continued to maintain the majority of its probability weighting used in the economic forecast to the Moody’s Baseline scenario with slightly more emphasis on the S-3 downside scenario and a smaller percentage weighting on the S-1 upside scenario as compared to December 31, 2025.

At June 30, 2026, the standalone Moody's Baseline scenario reflected a slightly more optimistic outlook as compared to December 31, 2025 for several metrics, including a few highlighted below.

At June 30, 2026, Moody's Baseline forecast included the following specific assumptions:

• GDP growth:

GDP will slowly increase to 2.8 percent throughout 2026 before trending down to 1.8 percent in late 2027.

GDP is expected to remain positive, but moderate, with annual average growth of approximately 2.1 percent for the remainder of 2026 before trending down slightly to 2.0 percent in the second quarter 2028.

• Unemployment Rate:

An unemployment rate around 4.5 percent combined with slow job growth throughout the remainder of 2026 will remain relatively unchanged by the end of 2027.

The outlook for the labor market projects slower job growth over the remainder of 2026, with the unemployment rate expected to be at approximately 4.5 percent by December 31, 2026 and remain near that level through the second quarter 2028.

• Federal funds:

The target federal funds rate range of 3.5 - 3.75 percent at March 31, 2026 is assumed to remain unchanged until June 2026;

and then fall to an upper target rate below 3.14 percent by the end of 2027.

The inflation rate was 3.3 percent in March 2026 and is expected to decrease to 2.71 percent in 2027 and trend downward in the years to follow.

The current target federal funds rate range of 3.5 - 3.75 percent at June 30, 2026 is projected to remain unchanged until the second quarter 2028.

Inflation is expected to average 3.4 percent in the second half of 2026 and decline to 2.3 percent in the second quarter 2028.

See more details regarding our allowance for credit losses for loans in Note 7 to the consolidated financial statements.

The table below summarizes the relationship among loans, loans charged-off, loan recoveries, the provision for credit losses and the allowance for credit losses for loans for the periods indicated:

Three Months Ended

2026 December 31,

Three Months Ended Six Months Ended

2026 March 31,

2026 June 30,

2025 June 30,

2026 June 30,

($ in thousands)

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Construction — — — — (1,163)

Residential mortgage — — (46) — (46)

Total consumer (3,354) (3,263) (2,213) (6,617) (4,353)

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The following table presents the relationship among net loans charged-off and recoveries, and average loan balances outstanding for the periods indicated:

Three Months Ended

March 31, 2026 December 31, 2025 March 31, 2025

Three Months Ended Six Months Ended

June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025

($ in thousands)

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Total annualized net loan charge-offs to total average loans outstanding 0.17 0.14 0.31 0.16 0.33

Net loan charge-offs totaling $17.5 million for the first quarter 2026 as compared to $22.6 million and $41.9 million for the fourth quarter 2025 and the first quarter 2025, respectively.

Gross loan charge-offs totaled $19.8 million for the first quarter 2026 and were mostly driven by the partial charge-offs of non-performing loan relationships within the CRE loan category.

Net loan charge-offs (as presented in the above table) declined from the fourth quarter 2025 and continued to trend within management's expectations for the credit quality of the loan portfolio at March 31, 2026.

Net loan charge-offs totaled $22.0 million for the second quarter 2026 as compared to $17.5 million and $37.8 million for the first quarter 2026 and the second quarter 2025, respectively.

Gross loan charge-offs totaled $27.6 million for the second quarter 2026 and were largely due to partial charge-offs of non-performing commercial real estate and commercial and industrial loans.

Net loan charge-offs for the second quarter 2026 (as presented in the above table) increased from the first quarter 2026, but continued to trend within management's expectations for the credit quality of the loan portfolio at June 30, 2026.

While we currently expect the level of total net loan charge-offs to average loans outstanding to range from 0.15 to 0.20 percent for the full year of 2026, we can make no assurances that actual net loan charge-offs will not be higher than anticipated for 2026.

The following table summarizes the allocation of the allowance for credit losses for loans to loan portfolio categories and the allocations as a percentage of each loan category:

March 31, 2026 December 31, 2025 March 31, 2025

June 30, 2026 March 31, 2026 June 30, 2025

Allocation Allocation

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Allowance for credit losses for loans as a % of total loans 1.16 % 1.18 % 1.20 %

The allowance for credit losses for loans, comprised of our allowance for loan losses and unfunded credit commitments, as a percentage of total loans was 1.18 percent at March 31, 2026, 1.19 percent at December 31, 2025, and 1.22 percent at March 31, 2025.

For the first quarter 2026, the provision for credit losses for loans totaled $21.2 million as compared to $20.0 million and $62.7 million for the fourth quarter 2025 and first quarter 2025, respectively.

The first quarter 2026 provision was mainly impacted by (i) increases in the economic forecast and non-economic qualitative components of our reserve and (ii) commercial loan growth, partially offset by (iii) lower quantitative reserves in certain loan categories at March 31, 2026.

The allowance for credit losses for loans, comprised of our allowance for loan losses and unfunded credit commitments, as a percentage of total loans was 1.16 percent at June 30, 2026, 1.18 percent at March 31, 2026, and 1.20 percent at June 30, 2025.

For the second quarter 2026, the provision for credit losses for loans totaled $29.2 million as compared to $21.2 million and $37.8 million for the first quarter 2026 and second quarter 2025, respectively.

The second quarter 2026 provision was mainly impacted by (i) higher specific reserves associated with collateral dependent loans, (ii) an increase in the economic forecast component of our reserve and (iii) strong commercial loan growth, partially offset by a decline in quantitative reserves largely within certain commercial real estate loan categories at June 30, 2026.

Capital Adequacy

A significant measure of the strength of a financial institution is its shareholders’ equity.

Shareholders' equity of approximately $7.8 billion at both March 31, 2026 and December 31, 2025 represented 12.1 percent and 12.2 percent of total assets at each respective period end.

During the three months ended March 31, 2026, total shareholders’ equity increased by approximately $20.7 million primarily due to the following:

Shareholders' equity of $7.9 billion and $7.8 billion at June 30, 2026 and December 31, 2025, respectively, represented 11.9 percent and 12.2 percent of total assets at each respective period end.

During the six months ended June 30, 2026, total shareholders’ equity increased by approximately $109.5 million primarily due to the following:

• net income of $334.8 million and

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• cash dividends declared on common and preferred stock totaling a combined $138.0 million,

• repurchases of $52.1 million shares of our common stock held in treasury stock, and

• repurchases of $72.4 million of common stock held in treasury stock, and

• other comprehensive loss of $25.2 million.

Valley and the Bank are subject to the regulatory capital requirements administered by the FRB and the OCC.

Quantitative measures established by regulation to ensure capital adequacy require Valley and the Bank to maintain

minimum amounts and ratios of CET1, total and Tier 1 capital to risk-weighted assets, and Tier 1 capital to average assets, as defined in the regulations.

Quantitative measures established by regulation to ensure capital adequacy require Valley and the Bank to maintain minimum amounts and ratios of CET1, total and Tier 1 capital to risk-weighted assets, and Tier 1 capital to average assets, as defined in the regulations.

Valley and the Bank are required to maintain minimum ratios, including a 2.5 percent capital conservation buffer, of (i) CET1 to risk-weighted assets of 7.0 percent or greater, (ii) Tier 1 capital to risk-weighted assets of 8.5 percent or greater, and (iii) total capital to risk-weighted assets of 10.5 percent or greater, as well as a minimum leverage ratio of 4.0 percent for capital adequacy purposes.

As of March 31, 2026 and December 31, 2025, Valley and Valley National Bank exceeded all capital adequacy requirements (see table below).

The following table presents Valley’s and Valley National Bank’s actual capital positions and ratios under Basel III risk-based capital guidelines at March 31, 2026 and December 31, 2025:

As of June 30, 2026 and December 31, 2025, Valley and Valley National Bank exceeded all capital adequacy requirements (see table below).

The following table presents Valley’s and Valley National Bank’s actual capital positions and ratios under Basel III risk-based capital guidelines at June 30, 2026 and December 31, 2025:

Actual Minimum Capital

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($ in thousands)

As of March 31, 2026

As of June 30, 2026

Total Risk-based Capital

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Valley National Bank 6,297,558 10.27 2,453,670 4.00 3,067,088 5.00

Valley's total risk-based capital ratio decreased to 13.66 percent at March 31, 2026 as compared to 13.77 percent at December 31, 2025 mainly as a result of our loan growth and common stock buyback activity during the first quarter 2026.

Typically, our primary source of capital growth is through retention of earnings.

Our rate of earnings retention is calculated by dividing undistributed earnings per common share by earnings (or net income available to common

shareholders) per common share.

Our retention ratio was 60.7 percent for the three months ended March 31, 2026 as compared to 56.4 percent for the full year ended December 31, 2025.

Cash dividends declared amounted to $0.11 per common share for each of the three months ended March 31, 2026 and 2025.

Our rate of earnings retention is calculated by dividing undistributed earnings per common share by earnings (or net income available to common shareholders) per common share.

Our retention ratio was 61.4 percent for the six months ended June 30, 2026 as compared to 56.4 percent for the full year ended December 31, 2025.

Cash dividends declared amounted to $0.22 per common share for each of the six months ended June 30, 2026 and 2025.

The Board is committed to examining and weighing relevant facts and considerations, including its commitment to shareholder value, each time it makes a cash dividend decision.

The Federal Reserve has cautioned all bank holding companies about distributing dividends which may reduce the level of capital or not allow capital to grow considering the increased capital levels required under the Basel III rules.

Prior to the date of this filing, Valley has received no objection or adverse guidance from the Federal Reserve or the OCC regarding the current level of its quarterly common stock dividend.

However, the Federal Reserve has reiterated its long-standing guidance in recent years that banking organizations should consult them before declaring dividends in excess of earnings for the corresponding quarter.

Risk Factors of Valley's Annual Report for additional information.

Risk Factors of Valley's Annual Report for additional information regarding factors that could adversely impact our ability to declare future cash dividends.

Off-Balance Sheet Arrangements, Contractual Obligations and Other Matters

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis