VALLEY NATIONAL BANCORP 10-Q

Item 2. Management’s Discussion and Analysis (MD&A) of Financial Condition and Results of Operations The following MD&A should be read in conjunction with the consolidated financial statements and notes thereto appearing in Part I, Item 1 of this report. The MD&A contains supplemental financial information, described in the sections that follow, which has been determined by methods other than GAAP that management uses in its analysis of our performance. Management believes these non-GAAP financial measures provide information useful to investors in understanding our underlying operational performance, our business and performance trends and facilitate comparisons with the performance of others in the financial services industry. These non-GAAP financial measures should not be considered in isolation, as a substitute for or superior to financial measures calculated in accordance with GAAP. These non-GAAP financial measures may also be calculated differently from similar measures disclosed by other companies. Cautionary Statement Concerning Forward-Looking Statements This Quarterly Report on Form 10-Q, both in the MD&A and elsewhere, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are not historical facts and include expressions about management’s confidence and strategies and management’s expectations about our business, new and existing programs and products, acquisitions, relationships, opportunities, taxation, technology, market conditions and economic expectations. These statements may be identified by forward-looking terminology such as “intend,” “should,” “expect,” “believe,” "position", “view,” “opportunity,” “allow,” “continues,” “reflects,” “would,” “could,” “typically,” “usually,” “anticipate,” “may,” “estimate,” “outlook,” “project” or similar statements or variations of such terms. Such forward-looking statements involve certain risks and uncertainties. Actual results may differ materially from such forward-looking statements. Factors that may cause actual results to differ materially from those contemplated in these forward-looking statements include, but are not limited to: • the impact of market interest rates and monetary and fiscal policies of the U.S. 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; U.S. government debt default or rating downgrade; unanticipated loan delinquencies; loss of collateral; decreased service revenues; increased business disruptions or failures; reductions in employment; 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; • the impact of any potential instability within the U.S. financial sector or future bank failures, including the possibility of a run on deposits by a coordinated deposit base, and the impact of any actual or perceived concerns regarding the soundness, or creditworthiness, of other financial institutions, including any resulting disruption within the financial markets, increased expenses, including FDIC insurance assessments, or adverse impact on our stock price, deposits or our ability to borrow or raise capital; • the impact of negative public opinion regarding Valley or banks in general that damages our reputation and adversely impacts business and revenues; • changes in the statutes, regulations, policies, enforcement priorities, or composition of the federal bank regulatory agencies; • the loss of or decrease in lower-cost funding sources within our deposit base; • investigations, damage verdicts, settlements or restrictions related to existing or potential class action litigation or individual litigation arising from claims of violations of laws or regulations, contractual claims, breach of fiduciary responsibility, negligence, fraud, environmental laws, patent, trademark or other intellectual property infringement, misappropriation or other violation, employment-related claims, and other matters; 44 • a prolonged downturn and contraction in the economy, as well as any decline in commercial real estate values collateralizing a significant portion of our loan portfolio; • higher or lower than expected income tax expense or tax rates, including increases or decreases resulting from changes in uncertain tax position liabilities, tax laws, regulations, and case law; • the inability to grow customer deposits to keep pace with the level of loan growth; • a material change in our allowance for credit losses due to forecasted economic conditions and/or unexpected credit deterioration in our loan and investment portfolios; • the need to supplement debt or equity capital to maintain or exceed internal capital thresholds; • changes in our business, strategy, market conditions or other factors that may negatively impact the estimated fair value of our goodwill and other intangible assets and result in future impairment charges; • greater than expected technology-related costs due to, among other factors, prolonged or failed implementations, additional project staffing and obsolescence caused by continuous and rapid market innovations; • increased competitive challenges and competitive pressure on pricing of our products and services; • our ability to stay current with rapid technological changes and evolving legal and regulatory requirements in the financial services industry, including developments relating to the use of artificial intelligence, blockchain, and related regulatory developments, as well as our ability to effectively assess and monitor the effects of, and risks associated with, the implementation and use of such technology; • cyberattacks, ransomware attacks, computer viruses, malware or other cybersecurity incidents that may breach the security of our or our third-party service providers’ websites or other systems or networks to obtain unauthorized access to personal, confidential, proprietary or sensitive information, destroy data, disable or degrade service, or sabotage our systems or networks, and the increasing sophistication of such attacks and use of targeted tactics against the financial services industry; • any disruption of our systems and network, or those of our third-party service providers, resulting from events that are wholly or partially beyond our control, including, for example, electrical, telecommunications, or other major service outages, or actions by employees, which may give rise to financial loss or liability; • results of examinations by the OCC, the FRB, the CFPB and other regulatory authorities, including the possibility that any such regulatory authority may, among other things, require us to increase our allowance for credit losses, write-down assets, reimburse customers, change the way we do business, or limit or eliminate certain other banking activities; • application of heightened regulatory standards for certain large insured national banks, and the expenses we will incur to develop policies, programs, and systems that comply with the enhanced standards applicable to us; • our inability or determination not to pay dividends at current levels, or at all, because of inadequate earnings, regulatory restrictions or limitations, changes in our capital requirements, or a decision to increase capital by retaining more earnings; • unanticipated loan delinquencies, loss of collateral, decreased service revenues, and other potential negative effects on our business caused by severe weather and other climate-related risks, pandemics or other public health crises, acts of terrorism or other external events; • our ability to successfully execute our business plan and strategic initiatives; and • unexpected significant declines in the loan portfolio due to the lack of economic expansion, increased competition, large prepayments, risk mitigation strategies, changes in regulatory lending guidance or other factors. A detailed discussion of factors that could affect our results is included in our SEC filings, including Item 1A. "Risk Factors" of Valley's Annual Report. 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 45 forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Critical Accounting Estimates Valley’s accounting policies are fundamental to understanding management’s discussion and analysis of its financial condition and results of operations. 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. Management has reviewed the application of these policies and estimates with the Audit Committee of Valley’s Board. Our critical accounting policies and estimates are described in detail in Part II, Item 7 in Valley’s Annual Report, and there have been no material changes in such policies and estimates since the date of Valley’s Annual Report. New Authoritative Accounting Guidance See Note 4 to the consolidated financial statements for a description of new authoritative accounting guidance, including the dates of adoption and effects on results of operations and financial condition. Executive Summary 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. 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. • Deposits: 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. See the "Deposits and Other Borrowings" section for more details. • Loans: 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. 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) modestly declined to 329 percent at March 31, 2026 from 333 percent at December 31, 2025. Based on our current loan growth 46 targets, we expect a continued gradual reduction of the CRE loan concentration ratio over the remainder 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. 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. 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. We continue to maintain significant access to readily available, diverse funding sources to fulfill both short-term and long-term funding needs. See the “Bank Liquidity” section for additional information. • 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. 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. The $57.8 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; and • 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. 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; and 47 • a $12.2 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. U.S. 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. 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. 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. 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 48 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. 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. 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 (in thousands) Less than three months $ 1,082,860 Three to six months 633,827 Six to twelve months 830,929 More than twelve months 167,114 Total $ 2,714,730 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. Management continuously monitors liquidity and all available funding sources, including non-deposit borrowings discussed below. See the “Liquidity and Cash Requirements” section of this MD&A for additional information. 49 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 (in thousands) Average short-term borrowings: FHLB advances $ — $ 12,173 $ 241,944 Securities sold under repurchase agreements 70,698 70,495 60,693 Federal funds purchased 1,111 11,685 5,000 Total $ 71,809 $ 94,353 $ 307,637 Average long-term borrowings: FHLB advances $ 2,345,826 $ 2,463,604 $ 2,300,093 Subordinated debt 445,806 443,222 648,738 Junior subordinated debentures issued to capital trusts 57,847 57,761 57,500 Total $ 2,849,479 $ 2,964,587 $ 3,006,331 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 $2.9 billion at December 31, 2025 due to the maturity and repayment of FHLB advances. Non-GAAP Financial Measures The table below presents selected performance indicators, their comparative non-GAAP measures and the (non-GAAP) efficiency ratio for the periods indicated. Valley believes that the non-GAAP financial measures provide useful supplemental information to both management and investors in understanding Valley's underlying operational performance, business, and performance trends, and may facilitate comparisons of our current and prior performance with the performance of others in the financial services industry. Management utilizes these measures for internal planning, forecasting, and analysis purposes. Management believes that Valley’s presentation and discussion of this supplemental information, together with the accompanying reconciliations to the GAAP financial measures, also allows investors to view performance in a manner similar to management. These non-GAAP financial measures should not be considered in isolation, as a substitute for or superior to financial measures calculated in accordance with GAAP. These non-GAAP financial measures may also be calculated differently from similar measures disclosed by other companies. 50 The following table presents our annualized performance ratios : Three Months Ended March 31, 2026 2025 Selected Performance Indicators ($ in thousands) GAAP measures: Net income, as reported $ 163,913 $ 106,058 Return on average assets 1.02 % 0.69 % Return on average shareholders’ equity 8.35 5.69 Non-GAAP measures: Net income, as adjusted $ 168,890 $ 106,066 Return on average assets, as adjusted 1.05 % 0.69 % Return on average shareholders' equity, as adjusted 8.60 5.69 Return on average tangible common shareholders’ equity (ROATCE) 11.56 8.11 ROATCE, as adjusted 11.92 8.11 Efficiency ratio, as adjusted 53.10 55.87 March 31, 2026 December 31, 2025 Common Equity Per Share Data: Book value per common share (GAAP) $ 13.48 $ 13.39 Tangible book value per common share (non-GAAP) 9.94 9.85 Non-GAAP Reconciliations to GAAP Financial Measures Adjusted net income is computed as follows: Three Months Ended March 31, 2026 2025 (in thousands) Net income, as reported (GAAP) $ 163,913 $ 106,058 Non-GAAP adjustments: Add: Restructuring charge (1) 5,689 — Add: Litigation reserve (2) 1,262 — Add: Losses on available for sale and held to maturity debt securities, net (3) 10 11 Total non-GAAP adjustments to net income $ 6,961 $ 11 Income tax adjustments related to non-GAAP adjustments (4) (1,984) (3) Net income, as adjusted (non-GAAP) $ 168,890 $ 106,066 (1) Represents severance expense related to workforce reductions within salary and employee benefits expense. (2) Represents the change in legal reserves and settlement charges included in professional and legal fees. (3) Included in gains on securities transactions, net. (4) 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. See the “Non-Interest Income” section below for more details. 51 Adjusted annualized return on average assets is computed by dividing adjusted net income by average assets, as follows: Three Months Ended March 31, 2026 2025 ($ in thousands) Net income, as adjusted (non-GAAP) $ 168,890 $ 106,066 Average assets (GAAP) $ 64,190,084 $ 61,502,768 Annualized return on average assets, as adjusted (non-GAAP) 1.05 % 0.69 % Adjusted annualized return on average shareholders' equity is computed by dividing adjusted net income by average shareholders' equity, as follows: Three Months Ended March 31, 2026 2025 ($ in thousands) Net income, as adjusted (non-GAAP) $ 168,890 $ 106,066 Average shareholders' equity (GAAP) $ 7,855,550 $ 7,458,177 Annualized return on average shareholders' equity, as adjusted (non-GAAP) 8.60 % 5.69 % ROATCE and adjusted ROATCE are computed by dividing net income and adjusted net income (excluding intangible amortization, net of tax), respectively, by average tangible common shareholders’ equity calculated, as follows: Three Months Ended March 31, 2026 2025 ($ in thousands) Net income available to common shareholders, as reported (GAAP) $ 156,696 $ 99,103 Add: Amortization of other intangible assets (net of tax), other than loan servicing rights 4,746 5,619 Net income available to common shareholders excluding intangible amortization (GAAP) 161,442 104,722 Average shareholders’ equity (GAAP) $ 7,855,550 $ 7,458,177 Less: Average preferred shareholders equity 354,345 354,345 Less: Average goodwill and other intangible assets 1,858,851 1,859,614 Less: Average intangible assets (net of deferred tax liability), other than loan servicing rights 57,080 76,167 Average tangible common shareholders' equity (non-GAAP) $ 5,585,274 $ 5,168,051 ROATCE (non-GAAP) 11.56 % 8.11 % Net income available to common shareholders, as adjusted (non-GAAP) $ 161,673 $ 99,111 Add: Amortization of other intangible assets (net of tax), other than loan servicing rights 4,746 5,619 Net income available to common shareholders excluding intangible amortization (non-GAAP) 166,419 104,730 Average tangible common shareholders' equity (non-GAAP) $ 5,585,274 $ 5,168,051 ROATCE, as adjusted (non-GAAP) 11.92 % 8.11 % 52 The efficiency ratio is computed as follows: Three Months Ended March 31, 2026 2025 ($ in thousands) Total non-interest expense, as reported (GAAP) $ 309,926 $ 276,618 Less: Restructuring charge (pre-tax) (1) 5,689 — Less: Amortization of tax credit investments (pre-tax) 16,014 9,320 Less: Litigation reserve (pre-tax) (2) 1,262 — Total non-interest expense, as adjusted (non-GAAP) $ 286,961 $ 267,298 Net interest income, as reported (GAAP) 471,525 420,105 Total non-interest income, as reported (GAAP) 68,836 58,294 Add: Losses on available for sale and held to maturity debt securities, net (pre-tax) (3) 10 11 Gross operating income, as adjusted (non-GAAP) $ 540,371 $ 478,410 Efficiency ratio (non-GAAP) 53.10 % 55.87 % (1) Represents severance expense related to workforce reductions within salary and employee benefits expense. (2) Represents the change in legal reserves and settlement charges included in professional and legal fees. (3) Included in gains 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: March 31, 2026 December 31, 2025 ($ in thousands, except for share data) Common shares outstanding 554,316,876 556,618,021 Shareholders’ equity (GAAP) $ 7,828,443 $ 7,807,698 Less: Preferred stock 354,345 354,345 Less: Goodwill and other intangible assets 1,963,706 1,969,811 Tangible common shareholders’ equity (non-GAAP) $ 5,510,392 $ 5,483,542 Book value per common share (GAAP) $ 13.48 $ 13.39 Tangible book value per common share (non-GAAP) $ 9.94 $ 9.85 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 53 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. 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. 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. 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. 54 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: Quarterly Analysis of Average Assets, Liabilities and Shareholders’ Equity and Net Interest Income on a Tax Equivalent Basis Three Months Ended March 31, 2026 December 31, 2025 March 31, 2025 Average Balance Interest Average Rate Average Balance Interest Average Rate Average Balance Interest Average Rate ($ in thousands) Assets Interest earning assets: Loans (1)(2) $ 50,265,383 $ 708,662 5.64 % $ 49,614,838 $ 724,231 5.84 % $ 48,654,921 $ 703,632 5.78 % Taxable investments (3) 7,732,330 78,608 4.07 7,737,669 78,433 4.05 7,100,958 69,562 3.92 Tax-exempt investments (1)(3) 542,177 5,972 4.41 533,578 5,777 4.33 552,291 5,952 4.31 Interest bearing deposits with banks 1,178,997 10,758 3.65 869,310 8,592 3.95 583,521 6,879 4.72 Total interest earning assets 59,718,887 804,000 5.39 58,755,395 817,033 5.56 56,891,691 786,025 5.53 Allowance for credit losses (595,508) (590,780) (577,551) Cash and due from banks 347,912 354,629 418,806 Other assets 4,803,608 4,838,490 4,950,547 Unrealized losses on securities available for sale, net (84,815) (102,180) (180,725) Total assets $ 64,190,084 $ 63,255,554 $ 61,502,768 Liabilities and Shareholders’ Equity Interest bearing liabilities: Savings, NOW and money market deposits $ 29,203,978 $ 190,785 2.61 % $ 27,891,256 $ 197,892 2.84 % $ 26,345,983 $ 200,221 3.04 % Time deposits 11,226,874 106,678 3.80 11,553,390 116,657 4.04 11,570,758 125,069 4.32 Total interest bearing deposits 40,430,852 297,463 2.94 39,444,646 314,549 3.19 37,916,741 325,290 3.43 Short-term borrowings 71,809 236 1.31 94,353 502 2.13 307,637 2,946 3.83 Long-term borrowings (4) 2,849,479 33,500 4.70 2,964,587 35,839 4.84 3,006,331 36,411 4.84 Total interest bearing liabilities 43,352,140 331,199 3.06 42,503,586 350,890 3.30 41,230,709 364,647 3.54 Non-interest bearing deposits 11,942,322 11,917,134 11,222,562 Other liabilities 1,040,072 1,111,872 1,591,320 Shareholders’ equity 7,855,550 7,722,962 7,458,177 Total liabilities and shareholders’ equity $ 64,190,084 $ 63,255,554 $ 61,502,768 Net interest income/interest rate spread (5) $ 472,801 2.33 % $ 466,143 2.26 % $ 421,378 1.99 % Tax equivalent adjustment (1,276) (1,236) (1,273) Net interest income, as reported $ 471,525 $ 464,907 $ 420,105 Net interest margin (6) 3.16 % 3.17 % 2.95 % Tax equivalent effect 0.01 0.00 0.01 Net interest margin on a fully tax equivalent basis (6) 3.17 % 3.17 % 2.96 % _____________ (1) Interest income is presented on a tax equivalent basis using a 21 percent federal tax rate. (2) Loans are stated net of unearned income and include non-accrual loans. (3) The yield for securities that are classified as AFS is based on the average historical amortized cost. (4) Includes junior subordinated debentures issued to capital trusts which are presented separately on the consolidated statements of financial condition. 55 (5) Interest rate spread represents the difference between the average yield on interest earning assets and the average cost of interest bearing liabilities and is presented on a fully tax equivalent basis. (6) Net interest income as a percentage of total average interest earning assets. The following table demonstrates the relative impact on net interest income of changes in the volume of interest earning assets and interest bearing liabilities and changes in rates earned and paid by Valley on such assets and liabilities. Variances resulting from a combination of changes in volume and rates are allocated to the categories in proportion to the absolute dollar amounts of the change in each category. Change in Net Interest Income on a Tax Equivalent Basis Three Months Ended March 31, 2026 Compared to March 31, 2025 Change Due to Volume Change Due to Rate Total Change (in thousands) Interest Income: Loans* $ 22,957 $ (17,927) $ 5,030 Taxable investments 6,349 2,697 9,046 Tax-exempt investments* (110) 130 20 Federal funds sold and other interest bearing deposits 5,721 (1,842) 3,879 Total increase (decrease) in interest income 34,917 (16,942) 17,975 Interest Expense: Savings, NOW and money market deposits 20,391 (29,827) (9,436) Time deposits (3,628) (14,763) (18,391) Short-term borrowings (1,459) (1,251) (2,710) Long-term borrowings and junior subordinated debentures (1,864) (1,047) (2,911) Total increase (decrease) in interest expense 13,440 (46,888) (33,448) Total increase in net interest income $ 21,477 $ 29,946 $ 51,423 * Interest income is presented on a tax equivalent basis using 21 percent as the federal tax rate. 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. See further details below. 56 The following table presents the components of non-interest income for the three months ended March 31, 2026 and 2025: Three Months Ended March 31, 2026 2025 (in thousands) Wealth management and trust fees $ 16,006 $ 15,031 Insurance commissions 2,867 3,402 Capital markets 10,381 6,940 Service charges on deposit accounts 18,204 12,726 Gains on securities transactions, net 21 46 Fees from loan servicing 3,218 3,215 Gains on sales of loans, net 3,090 2,197 Bank owned life insurance 5,835 4,777 Other 9,214 9,960 Total non-interest income $ 68,836 $ 58,294 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. 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. See further details below. 57 The following table presents the components of non-interest expense for the three months ended March 31, 2026 and 2025: Three Months Ended March 31, 2026 2025 (in thousands) Salary and employee benefits expense $ 155,715 $ 142,618 Net occupancy expense 27,182 25,888 Technology, furniture and equipment expense 31,878 29,896 FDIC insurance assessment 10,476 12,867 Amortization of other intangible assets 6,919 8,019 Professional and legal fees 25,142 15,670 Amortization of tax credit investments 16,014 9,320 Other 36,600 32,340 Total non-interest expense $ 309,926 $ 276,618 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. 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. 58 Income Taxes 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. 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. Our adherence to these tax guidelines may result in volatile effective income tax rates in future quarterly and annual periods. Factors that could impact management’s judgment include changes in income, tax laws and regulations, and tax planning strategies. Based on the current information available, we anticipate that our effective tax rate will be at the low end of the 23 to 24 percent range previously disclosed in Valley's Annual report for the remainder of 2026. Operating Segments Valley manages its business operations under operating segments consisting of Consumer Banking and Commercial Banking. Activities not assigned to the operating segments are included in Treasury and Corporate Other. The accounting for each operating segment and Treasury and Corporate Other includes internal accounting policies designed to measure consistent and reasonable financial reporting and may result in income and expense measurements that differ from amounts under GAAP. The financial reporting for each segment contains allocations and reporting in line with Valley’s operations, which may not necessarily be comparable to those of any other financial institution. Furthermore, changes in management structure or allocation methodologies and procedures may result in changes in reported segment financial data. See Note 1 5 to the consolidated financial statements for additional details. 59 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 Consumer Banking Commercial Banking Treasury and Corporate Other Total ($ in thousands) Average interest earning assets $ 11,266,938 $ 38,998,445 $ 9,453,504 $ 59,718,887 Interest income $ 135,563 $ 571,823 $ 95,338 $ 802,724 Interest expense 62,486 216,285 52,428 331,199 Net interest income 73,077 355,538 42,910 471,525 Provision for credit losses 1,206 20,039 11 21,256 Net interest income after provision for credit losses 71,871 335,499 42,899 450,269 Non-interest income 31,193 31,223 6,420 68,836 Non-interest expense Salary and employee benefits expense 32,708 102,830 20,177 155,715 Net occupancy expense 5,194 17,709 4,279 27,182 Technology, furniture, and equipment expense 6,793 20,736 4,349 31,878 FDIC insurance assessment 2,348 8,128 — 10,476 Professional and legal fees 4,582 16,097 4,463 25,142 Other segment items * 13,987 22,294 23,252 59,533 Total non-interest expense $ 65,612 $ 187,794 $ 56,520 $ 309,926 Income (loss) before income taxes $ 37,452 $ 178,928 $ (7,201) $ 209,179 Return on average interest earning assets (pre-tax) 1.33 % 1.84 % (0.30) % 1.40 % Net interest margin 2.59 % 3.65 % 1.81 % 3.16 % Three Months Ended March 31, 2025 Consumer Banking Commercial Banking Treasury and Corporate Other Total ($ in thousands) Average interest earning assets $ 10,210,226 $ 38,444,695 $ 8,236,770 $ 56,891,691 Interest income $ 122,463 $ 579,896 $ 82,393 $ 784,752 Interest expense 65,442 246,411 52,794 364,647 Net interest income 57,021 333,485 29,599 420,105 Provision (credit) for credit losses (8,733) 71,408 (14) 62,661 Net interest income after provision for credit losses 65,754 262,077 29,613 357,444 Non-interest income 34,354 19,002 4,938 58,294 Non-interest expense Salary and employee benefits expense 31,974 102,990 7,654 142,618 Net occupancy expense 4,705 17,457 3,726 25,888 Technology, furniture, and equipment expense 6,237 19,853 3,806 29,896 FDIC insurance assessment 2,700 10,167 — 12,867 Professional and legal fees 2,899 10,943 1,828 15,670 Other segment items * 14,286 15,443 19,950 49,679 Total non-interest expense $ 62,801 $ 176,853 $ 36,964 $ 276,618 Income (loss) before income taxes $ 37,307 $ 104,226 $ (2,413) $ 139,120 Return on average interest earning assets (pre-tax) 1.46 % 1.08 % (0.12) % 0.98 % Net interest margin 2.24 % 3.47 % 1.44 % 2.95 % * Other segment items include amortization of intangible assets, amortization of tax credit investments and other general operating expenses. 60 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. 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. 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. See the “Net Interest Income” section above for more details on our net interest margin and funding sources. Commercial Banking Segment The Commercial Banking segment is comprised of floating rate and adjustable rate commercial and industrial loans and construction loans, as well as adjustable and fixed rate owner occupied and commercial real estate loans. Due to the portfolio’s interest rate characteristics, Commercial Banking is Valley’s operating segment that is most sensitive to movements in market interest rates. 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. See additional details in the "Loan Portfolio" section of this MD&A. 61 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. 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. 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. Treasury and Corporate Other Treasury and Corporate Other largely consists of the Treasury managed HTM debt securities and AFS debt securities portfolios mainly utilized for the liquidity management needs of our lending segments and income and expense items resulting from support functions not directly attributable to a specific segment. Interest income is generated through investments in various types of securities (mainly comprised of fixed rate securities) and interest-bearing deposits with other banks (primarily the Federal Reserve Bank of New York). Expenses related to the branch network, all other components of retail banking, along with the back office departments of the Bank are allocated from Treasury and Corporate Other to operating segments. Other non-interest income items and general expenses are allocated from Treasury and Corporate Other to each operating segment utilizing a methodology that involves an allocation of operating and funding costs based on each segment's respective mix of average interest earning assets outstanding for the period, number of deposits, or direct 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. 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. 62 ASSET/LIABILITY MANAGEMENT Interest Rate Risk Our success is largely dependent upon our ability to manage interest rate risk. 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. Asset/Liability management is a continuous process due to the constant change in interest rate risk factors. In assessing the appropriate interest rate risk levels for us, management weighs the potential benefit of each risk management activity within the desired parameters of liquidity, capital levels and management’s tolerance for exposure to income fluctuations. Many of the actions undertaken by management utilize fair value analysis and attempt to achieve consistent accounting and economic benefits for financial assets and their related funding sources. We have predominantly focused on managing our interest rate risk by attempting to match the inherent risk and cash flows of financial assets and liabilities. Specifically, management employs multiple risk management activities, such as optimizing the level of new residential mortgage originations retained in our mortgage portfolio through increasing or decreasing loan sales in the secondary market, product pricing levels, the desired maturity levels for new originations, the composition levels of both our interest earning assets and interest bearing liabilities, as well as several other risk management activities. We use a simulation model to analyze net interest income sensitivity to movements in interest rates. The simulation model projects net interest income based on various interest rate scenarios over a 12-month period. 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. 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. The assumptions used in the net interest income simulation are inherently uncertain. Actual results may differ significantly from those presented in the table below, due to the frequency and timing of changes in interest rates and changes in spreads between maturity and re-pricing categories. Overall, our net interest income is affected by changes in interest rates and cash flows from our loan and investment portfolios. We actively manage these cash flows in conjunction with our liability mix, duration, and interest rates to optimize the net interest income, while structuring the balance sheet in response to actual or potential changes in interest rates. Additionally, our net interest income is impacted by the level of competition within our marketplace. Competition can negatively impact the level of interest rates attainable on loans and increase the cost of deposits, which may result in downward pressure on our net interest margin in future periods. Other factors, including, but not limited to, the slope of the yield curve and projected cash flows will impact our net interest income results and may increase or decrease the level of asset sensitivity of our balance sheet. Convexity is a measure of how the duration of a financial instrument changes as market interest rates change. Potential movements in the convexity of bonds held in our investment portfolio, as well as the duration of the loan portfolio may have a positive or negative impact on our net interest income in varying interest rate environments. As a result, the increase or decrease in forecast net interest income may not have a linear relationship to the results reflected in the table below. Management cannot provide any assurance about the actual effect of changes in interest rates on our net interest income. 63 The following table reflects management’s expectations of the change in our net interest income over the next 12- month period considering the aforementioned assumptions. While an instantaneous and severe shift in interest rates was used in this simulation model, we believe that any actual shift in interest rates would likely be more gradual and would therefore have a more modest impact than shown in the table below. Estimated Change in Future Net Interest Income Changes in Interest Rates Dollar Change Percentage Change (in basis points) ($ in thousands) +300 $ 81,287 4.07 % +200 58,650 2.94 +100 26,789 1.34 –100 (29,895) (1.50) –200 (55,405) (2.77) –300 (54,588) (2.73) 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 1.50 percent. Management believes the interest rate sensitivity of our balance sheet remains within a n expected t olerance range at March 31, 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. Liquidity and Cash Requirements Bank Liquidity Liquidity measures Valley's ability to satisfy its current and future cash flow needs. Our objective is to have liquidity available to fulfill loan demands, repay deposits and other liabilities, and execute balance sheet strategies in all market conditions while adhering to internal controls and income targets. Valley's liquidity program is managed by the Treasury Department and routinely monitored by the Asset and Liability Management Committee and Board Risk Committee. Among other actions, the Treasury Department actively monitors Valley's current liquidity profile, sources and stability of funding, availability of assets for pledging or sale, opportunities to gather additional funds, and anticipated future funding needs, including the level of unfunded commitments. The Bank adheres to certain internal liquidity measures including ratios of loans to deposits below 105.0 percent and wholesale funding to total funding below 22.5 percent . 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: March 31, 2026 December 31, 2025 Loans to deposits 96.2 % 96.1 % Wholesale funding to total funding 14.3 15.3 Valley's short- and long-term cash requirements include contractual obligations under borrowings, deposits, payments related to leases, capital expenditures and other purchase commitments. In the ordinary course of operations, the Bank also enters into various financial obligations, including contractual obligations that may require future cash payments. Management believes the Bank has the ability to generate and obtain adequate amounts of 64 cash to meet its short-term and long-term obligations as they come due by utilizing various cash resources described below. On the asset side of the balance sheet, the Bank has numerous sources of liquid funds in the form of cash and due from banks, interest bearing deposits with banks (including the FRB of New York) and other sources. The following table summarizes Valley's liquid assets: March 31, 2026 December 31, 2025 (in thousands) Cash and due from banks $ 362,073 $ 315,166 Interest bearing deposits with banks 797,357 1,268,399 Held to maturity debt securities (1) 261,839 260,743 Available for sale debt securities (2) 4,157,034 4,202,218 Loans held for sale 11,227 26,236 Total liquid assets $ 5,589,530 $ 6,072,762 (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 . 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. 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. 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. 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: March 31, 2026 December 31, 2025 (in thousands) Securities sold under agreements to repurchase $ 63,877 $ 91,475 65 The following table summarizes the Bank's estimated unused available non-deposit borrowing capacities at March 31, 2026 and December 31, 2025: March 31, 2026 December 31, 2025 (in thousands) FHLB borrowing capacity* $ 5,789,820 $ 6,020,343 Unused FRB discount window* 10,316,000 10,145,000 Unused federal funds lines available from commercial banks 1,610,000 1,610,000 Unencumbered investment securities 5,230,655 4,694,183 Total $ 22,946,475 $ 22,469,526 * 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. Corporation Liquidity Valley’s recurring cash requirements primarily consist of dividends to preferred and common shareholders and interest expense on subordinated notes and junior subordinated debentures issued to capital trusts. As part of our ongoing asset/liability management strategies, Valley could also use cash to repurchase shares of its outstanding common stock under its share repurchase program or redeem its callable junior subordinated debentures and subordinated notes. Valley's cash needs are routinely satisfied by dividends collected from the Bank. Projected cash flows from the Bank are expected to be adequate to pay preferred and common dividends, if declared, and interest expense payable to subordinated note holders and capital trusts, given the current capital levels and current profitable operations of the Bank. In addition to dividends received from the Bank, Valley can satisfy its cash requirements by utilizing its own cash and potential new funds borrowed from outside sources or capital issuances. 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. 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. The AFS and HTM debt securities portfolios, which comprise the majority of the securities we own, include: U.S. Treasury securities, U.S. 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. 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. 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. The decision to purchase or sell securities is based upon the current assessment of long- and short-term economic and financial conditions, including the interest rate environment and other components of statement of financial condition. See additional information under “Interest Rate Risk,” “Liquidity and Cash Requirements” and “Capital Adequacy” sections elsewhere in this MD&A. 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, 66 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 Available for sale debt securities. AFS debt securities in unrealized loss positions are evaluated for impairment related to credit losses at least quarterly. In assessing whether a credit loss exists, we compare the present value of cash flows expected to be collected from the security with the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis for the security, a credit loss exists and an allowance for credit losses is recorded, limited to the amount that the fair value is less than the amortized cost basis. 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 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 . Held to maturity debt securities. Valley estimates the expected credit losses on HTM debt securities that have loss expectations using a discounted cash flow model developed by a third party. Valley has a zero-loss expectation for certain securities within the HTM portfolio, including U.S. Treasury securities, U.S. 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. 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 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. 67 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 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (in thousands) Available for sale investment grades: * AAA/AA/A Rated $ 4,025,108 $ 20,596 $ (135,523) $ 3,910,181 BBB Rated 116,566 574 (1,566) 115,574 Non-investment grade 2,371 — (383) 1,988 Not rated 132,919 1,101 (4,729) 129,291 Total $ 4,276,964 $ 22,271 $ (142,201) $ 4,157,034 Held to maturity investment grades: * AAA/AA/A Rated $ 3,436,744 $ 6,720 $ (383,433) $ 3,060,031 Not rated 183,810 1 (15,102) 168,709 Total $ 3,620,554 $ 6,721 $ (398,535) $ 3,228,740 Allowance for credit losses 746 — — 746 Total, net of allowance for credit losses $ 3,619,808 $ 6,721 $ (398,535) $ 3,227,994 * Rated using external rating agencies. Ratings categories include entire range. For example, “A Rated” includes A+, A, and A-. Split rated securities with two ratings are categorized at the higher of the rating levels. 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 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 $5.2 million gross unrealized losses. These HTM debt securities were negatively impacted by a higher level of market interest rates, and not changes in their underlying credit. See Note 6 to the consolidated financial statements for additional information regarding our investment securities portfolio. 68 Loan Portfolio The following table reflects the composition of the loan portfolio as of the dates presented: March 31, 2026 December 31, 2025 ($ in thousands) Loans Commercial and industrial $ 11,104,079 $ 10,961,519 Commercial real estate: Non-owner occupied 11,503,874 11,571,127 Multifamily (1) 8,588,462 8,571,713 Owner occupied 7,132,254 6,629,909 Total 27,224,590 26,772,749 Construction 2,485,387 2,471,233 Total commercial real estate 29,709,977 29,243,982 Residential mortgage 5,869,070 5,826,192 Consumer: Home equity 701,136 687,680 Automobile 2,198,102 2,184,600 Other consumer 1,246,456 1,232,755 Total consumer loans 4,145,694 4,105,035 Total loans (2) $ 50,828,820 $ 50,136,728 As a percentage of total loans: Commercial and industrial 21.8 % 21.9 % Commercial real estate: Non-owner occupied 22.6 23.1 Multifamily 16.9 17.1 Owner occupied 14.0 13.2 Construction 4.9 4.9 Total commercial real estate 58.4 58.3 Residential mortgage 11.5 11.6 Consumer loans 8.3 8.2 Total 100.0 % 100.0 % (1) 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. (2) 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. 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. 69 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. 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. 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. 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. 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. 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. Risk Factors of Valley's Annual Report. Non-performing Assets NPAs include non-accrual loans, OREO, and other repossessed assets (which consist of automobiles and taxi medallions) at March 31, 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 70 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 $439.6 million at March 31, 2026 as compared to December 31, 2025. NPAs as a percentage of total loans and NPAs totaled 0.86 percent and 0.87 percent at March 31, 2026 and December 31, 2025, respectively (as shown in the table below). Management believes that total NPAs at March 31, 2026 remain within credit quality expectations for the loan portfolio and continue to reflect Valley's consistent application of underwriting standards to both originated loans and loans purchased from third parties. For additional details, see the “Credit Quality Indicators” section in Note 7 to the consolidated financial statements. Our lending strategy is based on underwriting standards designed to maintain high credit quality, and we remain optimistic regarding the overall future performance of our loan portfolio. During the three months ended March 31, 2026, the majority of our borrowers continued to demonstrate resilience despite the impact of elevated borrowing costs, inflation, labor costs and other factors. We continue to proactively monitor our commercial loans for potential negative trends and borrower weakness due to the current operating environment, including the potential negative impact of volatile energy prices and tariffs/import fees, and internally risk rate them accordingly. Based on our most recent portfolio review, we believe that we have relatively modest direct exposure to customer businesses most influenced by changing tariff/import fee policies and moderate periods of elevated energy prices. However, management cannot provide assurance that the NPAs will not increase from the levels reported at March 31, 2026 due to the aforementioned or other factors potentially impacting our lending customers. 71 The following table sets forth by loan category accruing past due and NPAs on the dates indicated in conjunction with our asset quality ratios: March 31, 2026 December 31, 2025 ($ in thousands) Accruing past due loans: 30 to 59 days past due: Commercial and industrial $ 5,285 $ 11,177 Commercial real estate 69,494 72,810 Residential mortgage 20,534 21,615 Total consumer 13,112 14,420 Total 30 to 59 days past due 108,425 120,022 60 to 89 days past due: Commercial and industrial 1,015 1,274 Residential mortgage 4,285 10,181 Total consumer 3,506 5,269 Total 60 to 89 days past due 8,806 16,724 90 or more days past due: Commercial and industrial 3,499 — Commercial real estate — 212 Residential mortgage 5,894 3,300 Total consumer 1,309 1,070 Total 90 or more days past due 10,702 4,582 Total accruing past due loans $ 127,933 $ 141,328 Non-accrual loans: Commercial and industrial $ 145,804 $ 138,321 Commercial real estate 225,417 236,221 Construction 9,148 9,140 Residential mortgage 45,988 44,424 Total consumer 6,289 5,832 Total non-accrual loans 432,646 433,938 Other real estate owned (OREO) 5,161 4,531 Other repossessed assets 1,758 1,286 Total non-performing assets (NPAs) $ 439,565 $ 439,755 Total non-accrual loans as a % of loans 0.85 % 0.87 % Total NPAs as a % of loans and NPAs 0.86 0.87 Total accruing past due and non-accrual loans as a % of loans 1.10 1.15 Allowance for loan losses as a % of non-accrual loans 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 72 of the aforementioned C&I loan relationship from the 30 to 59 days past due delinquency category during the first quarter of 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. 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. For performing non-accrual loans, the collateral valuation shortfall may result in an allocation of specific reserves within our allowance for credit losses for loans. Allowance for Credit Losses for Loans The ACL for loans includes the allowance for loan losses and the reserve for unfunded credit commitments. Under CECL, our methodology to establish the allowance for loan losses has two basic components: (i) a collective reserve component for estimated expected credit losses for pools of loans that share common risk characteristics and (ii) an individually evaluated reserve component for loans that do not share risk characteristics, consisting of collateral dependent loans. Valley also maintains a separate allowance for unfunded credit commitments mainly consisting of undisbursed non-cancellable lines of credit, new loan commitments and commercial standby letters of credit. Valley estimates the collective ACL using a current expected credit losses methodology which is based on relevant information about historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the loan balances. In estimating the component of the allowance on a collective basis, we use a transition matrix model which calculates an expected life of loan loss percentage for each loan pool by using probability of default and loss given default metrics. The probability of default and loss given default metrics are adjusted using a scaling factor to incorporate a full economic cycle. The expected life of loan loss percentages are determined by analyzing the migration of loans within the commercial and industrial loan categories from performing to loss by credit quality rating or delinquency categories using historical life-of-loan data for each loan portfolio pool, and by assessing the severity of loss based on the aggregate net lifetime losses incurred. The expected credit losses based on loss history are adjusted for qualitative factors. Among other things, these adjustments include and account for differences in: (i) the impact of the reasonable and supportable economic forecast, relative probability weightings and economic variables under each scenario and reversion period, (ii) other weighted asset specific risks to the extent that they do not exist in the historical loss information, and (iii) net expected recoveries of charged-off loan balances. These adjustments are based on qualitative factors not reflected in the transition matrix but are likely to impact the measurement of estimated credit losses. The expected lifetime loss rate is the life of loan loss percentage from the transition matrix model plus the impact of the adjustments for qualitative factors. The expected credit losses are the product of multiplying the model’s expected lifetime loss rate by the exposure at default at period end on an undiscounted basis. Valley utilizes a two-year reasonable and supportable forecast period followed by a one-year period over which estimated losses revert to historical loss experience on a straight-line basis for the remaining life of the loan. The forecast consists of multi-scenario economic forecasts to estimate future credit losses and are governed by a cross-functional committee. The committee meets each quarter to determine which economic scenarios developed by Moody's will be incorporated into the model, as well as the relative probability weightings of the selected scenarios, based upon all readily available information. The model projects economic variables under each scenario based on 73 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: • GDP growth: GDP will slowly increase to 2.8 percent throughout 2026 before trending down to 1.8 percent in late 2027. • 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. • 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. • Inflation: 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. See more details regarding our allowance for credit losses for loans in Note 7 to the consolidated financial statements. 74 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 March 31, 2026 December 31, 2025 March 31, 2025 ($ in thousands) Allowance for credit losses for loans Beginning balance $ 596,100 $ 598,604 $ 573,328 Loans charged-off: Commercial and industrial (2,782) (5,958) (28,456) Commercial real estate (13,756) (16,034) (12,260) Construction — — (1,163) Total consumer (3,263) (3,060) (2,140) Total loans charged-off (19,801) (25,052) (44,019) Charged-off loans recovered: Commercial and industrial 1,398 636 810 Commercial real estate 347 1,096 249 Construction — 193 — Residential mortgage 83 180 168 Total consumer 429 397 843 Total loans recovered 2,257 2,502 2,070 Total net loan charge-offs (17,544) (22,550) (41,949) Provision charged for credit losses 21,244 20,046 62,675 Ending balance $ 599,800 $ 596,100 $ 594,054 Components of allowance for credit losses for loans: Allowance for loan losses $ 584,500 $ 583,400 $ 578,200 Allowance for unfunded credit commitments 15,300 12,700 15,854 Allowance for credit losses for loans $ 599,800 $ 596,100 $ 594,054 Components of provision for credit losses for loans: Provision for credit losses for loans $ 18,644 $ 20,950 $ 61,299 Provision (credit) for unfunded credit commitments 2,600 (904) 1,376 Total provision for credit losses for loans $ 21,244 $ 20,046 $ 62,675 Allowance for credit losses for loans as a % of total loans 1.18 % 1.19 % 1.22 % 75 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 ($ in thousands) Net loan (charge-offs) recoveries Commercial and industrial $ (1,384) $ (5,322) $ (27,646) Commercial real estate (13,409) (14,938) (12,011) Construction — 193 (1,163) Residential mortgage 83 180 168 Total consumer (2,834) (2,663) (1,297) Total $ (17,544) $ (22,550) $ (41,949) Average loans outstanding Commercial and industrial $ 11,015,736 $ 10,906,341 $ 9,996,024 Commercial real estate 26,898,522 26,338,955 26,328,971 Construction 2,470,225 2,507,513 3,054,230 Residential mortgage 5,850,295 5,833,105 5,639,313 Total consumer 4,030,605 4,028,924 3,636,383 Total $ 50,265,383 $ 49,614,838 $ 48,654,921 Annualized net loan charge-offs (recoveries) to average loans outstanding Commercial and industrial 0.05% 0.20% 1.11% Commercial real estate 0.20 0.23 0.18 Construction 0.00 (0.03) 0.15 Residential mortgage (0.01) (0.01) (0.01) Total consumer 0.28 0.26 0.14 Total annualized net loan charge-offs to total average loans outstanding 0.14 0.18 0.34 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 $19.8 million for the first quarter 2026 and were mostly driven by the partial charge-offs of non-performing loan relationships within the CRE loan category. Net loan charge-offs (as presented in the above table) declined from the fourth quarter 2025 and continued to trend within management's expectations for the credit quality of the loan portfolio at March 31, 2026. While we currently expect the level of total net loan charge-offs to average loans outstanding to range from 0.15 to 0.20 percent for the full year of 2026, we can make no assurances that actual net loan charge-offs will not be higher than anticipated for 2026. 76 The following table summarizes the allocation of the allowance for credit losses for loans to loan portfolio categories and the allocations as a percentage of each loan category: March 31, 2026 December 31, 2025 March 31, 2025 Allowance Allocation Allocation as a % of Loan Category Allowance Allocation Allocation as a % of Loan Category Allowance Allocation Allocation as a % of Loan Category ($ in thousands) Loan Category: Commercial and industrial loans $ 186,143 1.68 % $ 180,865 1.65 % $ 184,700 1.82 % Commercial real estate loans: Commercial real estate 269,847 0.99 271,890 1.02 266,938 1.02 Construction 54,946 2.21 55,536 2.25 54,724 1.81 Total commercial real estate loans 324,793 1.09 327,426 1.12 321,662 1.10 Residential mortgage loans 51,700 0.88 53,529 0.92 48,906 0.87 Consumer loans: Home equity 4,120 0.59 3,878 0.56 3,401 0.56 Auto and other consumer 17,744 0.52 17,702 0.52 19,531 0.62 Total consumer loans 21,864 0.53 21,580 0.53 22,932 0.61 Allowance for loan losses 584,500 1.15 583,400 1.16 578,200 1.19 Allowance for unfunded credit commitments 15,300 12,700 15,854 Total allowance for credit losses for loans $ 599,800 $ 596,100 $ 594,054 Allowance for credit losses for loans as a % of total loans 1.18 % 1.19 % 1.22 % 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. 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: • net income of $163.9 million and • a $1.2 million increase attributable to the effect of our stock incentive plan, partially offset by • cash dividends declared on common and preferred stock totaling a combined $69.1 million, • repurchases of $52.1 million shares of our common stock held in treasury stock, and • other comprehensive loss of $23.2 million. Valley and the Bank are subject to the regulatory capital requirements administered by the FRB and the OCC. Quantitative measures established by regulation to ensure capital adequacy require Valley and the Bank to maintain 77 minimum amounts and ratios of CET1, total and Tier 1 capital to risk-weighted assets, and Tier 1 capital to average assets, as defined in the regulations. Valley and the Bank are required to maintain minimum ratios, including a 2.5 percent capital conservation buffer, of (i) CET1 to risk-weighted assets of 7.0 percent or greater, (ii) Tier 1 capital to risk-weighted assets of 8.5 percent or greater, and (iii) total capital to risk-weighted assets of 10.5 percent or greater, as well as a minimum leverage ratio of 4.0 percent for capital adequacy purposes. As of March 31, 2026 and December 31, 2025, Valley and Valley National Bank exceeded all capital adequacy requirements (see table below). The following table presents Valley’s and Valley National Bank’s actual capital positions and ratios under Basel III risk-based capital guidelines at March 31, 2026 and December 31, 2025: Actual Minimum Capital Requirements To Be Well Capitalized Under Prompt Corrective Action Provision Amount Ratio Amount Ratio Amount Ratio ($ in thousands) As of March 31, 2026 Total Risk-based Capital Valley $ 7,018,614 13.66 % $ 5,393,104 10.50 % N/A N/A Valley National Bank 6,920,020 13.49 5,387,251 10.50 $ 5,130,715 10.00 % Common Equity Tier 1 Capital Valley 5,605,258 10.91 3,595,402 7.00 N/A N/A Valley National Bank 6,370,185 12.42 3,591,500 7.00 3,334,965 6.50 Tier 1 Risk-based Capital Valley 5,959,500 11.60 4,365,846 8.50 N/A N/A Valley National Bank 6,370,185 12.42 4,361,108 8.50 4,104,572 8.00 Tier 1 Leverage Capital Valley 5,959,500 9.56 2,492,902 4.00 N/A N/A Valley National Bank 6,370,185 10.23 2,490,224 4.00 3,112,780 5.00 As of December 31, 2025 Total Risk-based Capital Valley $ 6,965,724 13.77 % $ 5,311,534 10.50 % N/A N/A Valley National Bank 6,841,494 13.54 5,306,493 10.50 $ 5,053,803 10.00 % Common Equity Tier 1 Capital Valley 5,558,508 10.99 3,541,023 7.00 N/A N/A Valley National Bank 6,297,558 12.46 3,537,662 7.00 3,284,972 6.50 Tier 1 Risk-based Capital Valley 5,912,750 11.69 4,299,813 8.50 N/A N/A Valley National Bank 6,297,558 12.46 4,295,733 8.50 4,043,042 8.00 Tier 1 Leverage Capital Valley 5,912,750 9.63 2,455,946 4.00 N/A N/A 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 78 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. 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. See Item 1A. Risk Factors of Valley's Annual Report for additional information. Off-Balance Sheet Arrangements, Contractual Obligations and Other Matters For a discussion of Valley’s off-balance sheet arrangements and contractual obligations see information included in Valley’s Annual Report in the MD&A section “Liquidity and Cash Requirements” and Notes 1 2 and 13 to the consolidated financial statements included in this report. Item 3. Quantitative and Qualitative Disclosures About Market Risk Market risk refers to potential losses arising from changes in interest rates, foreign exchange rates, equity prices, and commodity prices. Valley’s market risk is composed primarily of interest rate risk. See pa ge 63 for a discussion of interest rate risk.