Valley National Bancorp (VLY) Q1 2025 earnings summary

Executive summary

• Net income for Q1 2025 was $106.1 million ($0.18 per diluted share), up from $96.3 million in Q1 2024, with stable revenue, improved net interest margin, and reduced non-accrual loans and delinquencies.

• Core deposit growth enabled reduction of higher-cost brokered and indirect deposits, supporting net interest income and margin stability.

• The business remains well-positioned despite economic headwinds from tariff uncertainty, inflation expectations, and market volatility.

• Ongoing diversification and expansion into new business lines and geographies are supporting long-term growth.

• Credit quality improved with lower provision for loan losses and reduced non-accrual loans and delinquencies.

Financial highlights

• Net interest income was $421.4 million, up $26.5 million year-over-year, with net interest margin rising to 2.96% from 2.79% in Q1 2024.

• Adjusted non-interest expense was $267 million, down 3% sequentially and flat year-over-year, with efficiency ratio improving to 55.87%.

• Allowance for credit losses as a percentage of loans was 1.22%, up from 1.17% at year-end 2024.

• Non-interest income was $58.3 million, with growth in FX and syndication fees offsetting lower wealth and trust fees.

• Provision for credit losses was $62.7 million, down from $107.0 million in Q4 2024 but up from $45.3 million in Q1 2024.

Outlook and guidance

• Loan growth and net interest income are expected at the low end of 2025 guidance, with allowance for credit losses anticipated to migrate toward 1.25% of total loans by year-end.

• Annual fee income and tax rate expectations remain unchanged at 23–25%.

• Net charge-offs and loan loss provision are expected to decline by roughly 50% from 2024 levels.

• Net interest margin is projected to increase throughout 2025, with a year-end target of 3.10%.

• Management expects further improvement in credit quality and continued core deposit growth to support profitability goals.