VALLEY NATIONAL BANCORP

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The foregoing 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 such forward-looking terminology as “intend,” “should,” “expect,” “believe,” “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 by such forward-looking statements include, but are not limited to:

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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 such forward-looking terminology as “intend,” “should,” “expect,” “believe,” “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 by such forward-looking statements include, but are not limited to:

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•the impact of unfavorable macroeconomic conditions or downturns, including instability or volatility in financial markets resulting from the impact of tariffs, any retaliatory actions, related market uncertainty, or other factors; 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 legislation and policy changes under the new U.S. presidential administration, geopolitical instabilities or events, natural and other disasters, including severe weather events, health emergencies, acts of terrorism, or other external events;

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•the impact of unfavorable macroeconomic conditions or downturns, including instability or volatility in financial markets resulting from the impact of tariffs, 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, geopolitical instabilities or events, natural and other disasters, including severe weather events, health emergencies, acts of terrorism, or other external events;

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•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 the actual or perceived soundness, or concerns about the 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;

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•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 the 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;

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•damage verdicts or 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;

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•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;

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•a material change in our allowance for credit losses under CECL due to forecasted economic conditions and/or unexpected credit deterioration in our loan and investment portfolios;

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•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;

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•increased competitive challenges, including our ability to stay current with rapid technological changes in the financial services industry;

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•increased competitive challenges and our ability to stay current with rapid technological changes in the financial services industry, including the use of artificial intelligence, as well as our ability to assess and monitor the effects of, and risks associated with, the implementation and use of such technology;

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Company Overview. At March 31, 2025, Valley had consolidated total assets of approximately $61.9 billion, total net loans of $48.1 billion, total deposits of $50.0 billion and total shareholders’ equity of $7.5 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 229 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.

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Company Overview. At June 30, 2025, Valley had consolidated total assets of approximately $62.7 billion, total net loans of $48.8 billion, total deposits of $50.7 billion and total shareholders’ equity of $7.6 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.

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Financial Condition. During the first quarter 2025, we continued to strengthen our balance sheet to best perform in the current uncertain economic environment, while also prudently managing and reducing the overall risk of our loan portfolio. The following items, including key balance sheet initiatives, are highlights at March 31, 2025.

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Financial Condition. During the second quarter 2025, we continued to strengthen our balance sheet to best perform in the current uncertain economic environment, while also prudently managing the overall risk of our loan portfolio. The following items, including key balance sheet initiatives, are highlights at June 30, 2025.

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•Commercial Real Estate Loan Concentration: Total commercial real estate loans (including construction loans) totaled $29.1 billion, or 59.8 percent of total loans at March 31, 2025 as compared to $29.6 billion, or 60.7 percent of total loans at December 31, 2024. The decrease was mostly due to normal repayment activity and selective originations as we continue to proactively diversify our loan portfolio by reducing new originations of certain types of transactional commercial real estate lending, such as non-owner occupied and multifamily loans to single-product borrowers. As a result, our CRE loan concentration ratio declined to approximately 353 percent at March 31, 2025 from 362 percent at December 31, 2024. Our current balance sheet goal is to reduce CRE concentration ratio to below 350 percent by December 31, 2025. See further details of our loan activities under the “Loan Portfolio” section below.

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•Commercial Real Estate Loan Concentration: Total commercial real estate loans (including construction loans) totaled $28.8 billion, or 58.4 percent of total loans at June 30, 2025, as compared to $29.1 billion, or 59.8 percent of total loans at March 31, 2025. The decrease was mostly due to normal repayment activity and selective originations as we continue to proactively diversify our loan portfolio and focus on the generation of more profitable and holistic banking client relationships. As a result, our CRE loan concentration ratio declined to approximately 349 percent at June 30, 2025 from 353 percent at March 31, 2025. Our current balance sheet goal is a continued gradual reduction of the CRE loan concentration ratio and to maintain the ratio below 350 percent through December 31, 2025. See further details of our loan activities under the “Loan Portfolio” section below.

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•Allowance for Credit Losses for Loans: The ACL for loans totaled $594.1 million and $573.3 million at March 31, 2025 and December 31, 2024, respectively, representing 1.22 percent and 1.17 percent of total loans at each respective date. The increase reflects, among other factors, an increase in quantitative reserves and continued growth in the commercial and industrial loan portfolio. Given our current projections for continued growth in our commercial and industrial loan portfolio and credit trends within our loan portfolio, we anticipate the ACL could continue to migrate towards approximately 1.25 percent of total loans by December 31, 2025. See the “Allowance for Credit Losses" section for additional information.

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•Allowance for Credit Losses for Loans: The ACL for loans totaled $594.0 million and $594.1 million at June 30, 2025 and March 31, 2025, respectively, representing 1.20 percent and 1.22 percent of total loans at each respective date. The moderate decrease reflects, among other factors, a decline in quantitative reserves in certain loan categories and lower specific reserves associated with collateral dependent loans at June 30, 2025. Given our current projections and credit trends within our loan portfolio, we anticipate the ACL will range between 1.20 percent and 1.25 percent of total loans through December 31, 2025. See the “Allowance for Credit Losses for Loans" section for additional information.

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•Credit Quality: Total accruing past due loans (i.e., loans past due 30 days or more and still accruing interest) decreased $47.5 million to $51.7 million, or 0.11 percent of total loans, at March 31, 2025 as compared to $99.2 million, or 0.20 of total loans, at December 31, 2024. Non-accrual loans totaled $346.5 million, or 0.71 percent of total loans, at March 31, 2025 as compared to $359.5 million, or 0.74 percent of total loans, at December 31, 2024. See the “Non-Performing Assets” section for additional information.

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•Credit Quality: Net loan charge-offs totaled $37.8 million for the second quarter 2025 as compared to $41.9 million and $36.8 million for the first quarter 2025 and second quarter 2024, respectively. Non-accrual loans totaled $354.4 million, or 0.72 percent of total loans, at June 30, 2025 as compared to $346.5 million, or 0.71 percent of total loans, at March 31, 2025. Total accruing past due loans (i.e., loans past due 30 days or more and still accruing interest) increased $147.5 million to $199.2 million, or 0.40 percent of total loans, at June 30, 2025 as compared to $51.7 million, or 0.11 percent of total loans, at March 31, 2025. The majority of this increase related to three CRE loans, of which two were no longer past due in July 2025. See the “Non-Performing Assets” section for additional information.

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•Liquid Assets: Our liquid assets totaled $5.1 billion at March 31, 2025, representing 9.1 percent of interest earning assets as compared with $5.5 billion, or 9.6 percent of interest earning assets at December 31, 2024. 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.

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•Liquid Assets: Our liquid assets totaled $5.4 billion at June 30, 2025, representing 9.3 percent of interest earning assets, as compared with $5.1 billion, or 9.1 percent of interest earning assets at March 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.

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•Investment Securities: Total investment securities increased $305.6 million to $7.3 billion, or 11.8 percent of total assets, at March 31, 2025 as compared to December 31, 2024 mainly due to targeted purchases of residential mortgage backed securities primarily issued by Ginnie Mae (with a risk-weighting of zero for regulatory capital purposes) that were classified as AFS. See the “Investment Securities Portfolio” section for more details.

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•Investment Securities: Total investment securities increased $226.1 million to $7.5 billion, or 12.0 percent of total assets, at June 30, 2025 as compared to March 31, 2025 mainly due to targeted purchases of residential mortgage backed securities mostly issued by Ginnie Mae (with a risk-weighting of zero for regulatory capital purposes) that were classified as AFS. See the “Investment Securities Portfolio” section for more details.

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•Regulatory Capital and Shareholders' Equity: Total shareholders' equity increased $64.8 million to $7.5 billion at March 31, 2025 as compared to December 31, 2024. Valley's total risk-based capital, common equity Tier 1 capital, Tier 1 capital and Tier 1 leverage capital ratios were 13.91 percent, 10.80 percent, 11.53 percent, and 9.41 percent, respectively, at March 31, 2025 as compared to 13.87 percent, 10.82 percent, 11.55 percent and 9.16 percent, respectively, at December 31, 2024. Currently, we expect that Valley's common equity Tier 1 capital will gradually increase to approximately 11 percent by December 31, 2025 largely through projected growth in our retained earnings and continuous management of the overall regulatory risk weighted asset profile of our balance sheet, including the goal to reduce our commercial real estate loan concentration. See the "Capital Adequacy" section below for more information.

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•Regulatory Capital and Shareholders' Equity: Total shareholders' equity increased $75.5 million to $7.6 billion at June 30, 2025 as compared to March 31, 2025. Valley's total risk-based capital, common equity Tier 1 capital, Tier 1 capital and Tier 1 leverage capital ratios were 13.67 percent, 10.85 percent, 11.57 percent, and 9.49 percent, respectively, at June 30, 2025 as compared to 13.91 percent, 10.80 percent, 11.53 percent and 9.41 percent, respectively, at March 31, 2025. The decline in our total risk-based capital ratio as compared to March 31, 2025 reflects the early redemption of our $115 million of 5.25 percent fixed-to-floating rate subordinated notes, which were previously eligible for full regulatory capital treatment. Currently, we expect that Valley's common equity Tier 1 capital will gradually increase to approximately 11 percent by December 31, 2025 largely through projected growth in our retained earnings and continuous management of the overall regulatory risk weighted asset profile of our balance sheet, including the goal to reduce our commercial real estate loan concentration. See the "Capital Adequacy" section below for more information.

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Quarterly Results. Net income for the first quarter 2025 was $106.1 million, or $0.18 per diluted common share, as compared to $96.3 million, or $0.18 per diluted common share, for the first quarter 2024. The $9.8 million increase in quarterly net income as compared to the same quarter one year ago was mainly due to the following changes:

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Quarterly Results. Net income for the second quarter 2025 was $133.2 million, or $0.22 per diluted common share, as compared to $70.4 million, or $0.13 per diluted common share, for the second quarter 2024. The $62.7 million increase in quarterly net income as compared to the same quarter one year ago was mainly due to the following changes:

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•a $26.6 million increase in net interest income mainly driven bylower interest rates on most interest bearing deposit products in the first quarter 2025 and additional interest income from investment security purchases, partially offset by lower yields on adjustable-rate loans; and

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•a $30.7 million increase in net interest income mainly driven by lower interest rates on most interest bearing deposit products in the second quarter 2025 and additional interest income from investment security purchases, partially offset by lower yields on adjustable-rate loans;

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•a $3.7 million decrease in non-interest expense primarily due to decreases in technology, furniture and equipment expense and FDIC assessment fees, largely offset by higher amortization of tax credit investments and other expense;

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•a $6.6 million increase in non-interest expense primarily due to increases in salary and employee benefits expense, amortization of tax credit investments, and net occupancy expense, partially offset by lower technology, furniture and equipment expense and FDIC insurance assessment fees; and

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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 aboveand other infrequent non-core items impactingour first quarter 2025 results.

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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 aboveand other infrequent non-core items impactingour second quarter 2025 results.

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U.S. Economic Conditions. During the first quarter 2025, real gross GDP decreased at an estimated annual rate of 0.3 percent as compared to an increase of 2.5 percent during the fourth quarter 2024. The contraction in GDP was primarily driven by a significant increase in imports likely caused by businesses and consumers stockpiling goods before potential tariffs take effect, as well as a reduction in government spending. These movements were partially offset by increases in investment, consumer spending and net exports. In addition, most measures of inflation continued to reflect a moderation in price pressures during the first quarter 2025. The rate of inflation declined to 2.4 percent in the first quarter 2025 as compared to 2.9 percent for the fourth quarter 2024.

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U.S. Economic Conditions. During the second quarter 2025, real GDP increased at an estimated annual rate of 3.0 percent as compared to a decrease of 0.5 percent during the first quarter 2025. The second quarter rebound from the first quarter 2025 was mainly driven by a decrease in imports and a modest increase in consumer spending and government expenditures. These movements were partially offset by decreases in gross private domestic investment driven by a reduction in inventory as inventory levels normalized after businesses and consumers stockpiled goods ahead of anticipated tariff increases in the first quarter 2025. While core inflation recently came in slightly below most forecasts, pricing trends did not significantly ease during the second quarter 2025. Overall, the rate of inflation has increased to 2.7 percent in the second quarter 2025 as compared to 2.4 percent for the first quarter 2025.

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The 10-year U.S. Treasury note yield ended the first quarter 2025 at 4.23 percent, or 35 basis points lower as compared to thefourth quarter 2024, and the 2-year U.S. Treasury note yield ended the first quarter 2025 at 3.89 percent, or 36 basis points lower as compared to thefourth quarter 2024.

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The 10-year U.S. Treasury note yield ended the second quarter 2025 at 4.24 percent, or 1 basis point higher as compared to the first quarter 2025, and the 2-year U.S. Treasury note yield ended the second quarter 2025 at 3.72 percent, or 15 basis points lower as compared to the first quarter 2025.

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Entering the first quarter of 2025, there was a general sense of an economic recovery and improving operating environment, and the Federal Reserve started to see modest progress in their efforts to combat inflation. However, more recent economic and political developments, such as new tariff policies, strict immigration enforcement, government spending cuts, a potentially weakening job market, continued elevated market interest rates, and ongoing geopolitical conflicts has weakened the current economic outlook. As a result of these factors, many market analysts have increased the likelihood of a recession in the coming year in their forecasts, and foresee an overall challenging bank operating environment. Should these conditions persist or further deteriorate, they may adversely impact our banking clients and our financial results, as highlighted elsewhere in this MD&A.

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The second quarter 2025 economic lookout was weakened by the continued negative impact of volatile U.S. tariff policies and trade negotiations, heightened geopolitical tensions, immigration enforcement, persistent concerns about the government deficit, including the impact of the recently passed OBBBA, and the level of inflation. As a result of these factors, many market analysts have increased the likelihood of a recession in their forecast for the coming year, and foresee an overall challenging bank operating environment. Should these conditions persist or further deteriorate, they may adversely impact our banking clients and our financial results, as highlighted elsewhere in this MD&A.

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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, 2025) was 53 percent as compared to 34 percent (between June 30, 2024 and December 31, 2024) one quarter ago. The continued increase of our cumulative deposit beta in the first quarter 2025 was mainly driven by a full quarter’s impact of the Federal Reserve's rate cuts in November and December 2024, and our ability to broadly reduce costs of interest bearing deposit products coupled with a reduction of higher cost indirect customer CDs. See the "Net Interest Income" section for additional details on the changes in our cost of deposits during the first quarter 2025.

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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 June 30, 2025) was 51 percent as compared to 53 percent (between June 30, 2024 and March 31, 2025) one quarter ago. The relative stabilization of our cumulative deposit beta in the second quarter 2025 was mainly driven by the Federal Reserve's decision to leave the target federal funds rate unchanged in the second quarter of 2025, and our ability to broadly maintain the level of interest rates offered on our interest bearing deposit products. See the "Net Interest Income" section for additional details on the changes in our cost of deposits during the second quarter 2025.

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Total average deposits decreased by $1.6 billion to $49.1 billion for the first quarter 2025 as compared to the fourth quarter 2024. Average time deposits balances decreased $2.0 billion from the fourth quarter 2024 largely due tothe maturity and repayment of higher cost indirect customer(i.e., brokered)CDs, partially offset by new direct retail customer CDs during the first quarter 2025. Average savings, NOW and money market deposits increased $417.8 million to $26.3 billion for the first quarter 2025 as compared to the fourth quarter 2024. Average non-interest-bearing deposits; savings, NOW and money market deposits; and time deposits represented approximately 23 percent, 54 percent, and 24 percent of total deposits for the first quarter 2025, respectively, as compared to 22 percent, 51 percent, and 27 percent of total deposits for the fourth quarter 2024, respectively.

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Total average deposits increased by $767.8 million to $49.9 billion for the second quarter 2025 as compared to the first quarter 2025. Average time deposit balances increased $548.7 million from the first quarter 2025 largely due to new direct retail customer CDs and our greater use of indirect customer (i.e., brokered) CDs in our funding mix during the second quarter 2025. Average non-interest bearing deposits increased $113.8 million to $11.3 billion for the second quarter 2025 as compared to the first quarter 2025, while average savings, NOW and money market deposits increased $105.4 million to $26.5 billion for the same period. Average non-interest-bearing deposits; savings, NOW and money market deposits; and time deposits represented approximately 23 percent, 53 percent, and 24 percent of total deposits for the second quarter 2025, respectively, as compared to 23 percent, 54 percent, and 23 percent of total deposits for the first quarter 2025, respectively.

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Actual ending balances for deposits decreased $110.0 million to $50.0 billion at March 31, 2025 from December 31, 2024 mainly due to a $418.5 million decrease in time deposits, partially offset by increases of $199.9 million and $108.6 million in non-interest bearing deposits and savings, NOW and money market deposits, respectively. The decrease in time deposit balances was mainly driven by a decline of approximately $661 million in indirect customer CDs, partially offset by deposit inflows from new retail CD offerings during the first quarter 2025. The increase in non-interest bearing was mostly due to higher commercial customer deposit inflows late in the first quarter 2025. Savings, NOW and money market deposit balances increased at March 31, 2025 from December 31, 2024 largely due to new deposits from our online savings deposit product offerings, partially offset by lower governmental deposits account balances. Total indirect customer deposits (including both brokered money market and time deposits) totaled $6.3 billion and $7.0 billion in March 31, 2025 and December 31, 2024, respectively. Non-interest bearing deposits; savings, NOW and money market deposits; and time deposits represented approximately 23 percent, 53 percent, and 24 percent of total deposits as of March 31, 2025, respectively, as compared to 23 percent, 52 percent, and 25 percent of total deposits as of December 31, 2024, respectively.

Current wording

Actual ending balances for deposits increased $759.4 million to $50.7 billion at June 30, 2025 from March 31, 2025 due to increases of $962.9 million and $118.2 million in time deposits and non-interest bearing deposits, respectively, partially offset by a $321.6 million decrease in savings, NOW and money market deposit balances. The increase in time deposit balances was mainly driven by continued deposit inflows from new promotional retail CD offerings and brokered customer CDs during the second quarter 2025. The increase in non-interest bearing deposit balances was mostly due to higher commercial customer deposit inflows in the second quarter 2025. Savings, NOW and money market deposit balances decreased at June 30, 2025 from March 31, 2025 largely due to lower indirect customer deposits, as well as some seasonal runoff in governmental deposits account balances. Total indirect customer deposits (including both brokered money market and time deposits) totaled $6.5 billion and $6.3 billion in June 30, 2025 and March 31, 2025, respectively. Non-interest bearing deposits; savings, NOW and money market deposits; and time deposits represented approximately 23 percent, 52 percent and 25 percent of total deposits as of June 30, 2025, respectively, as compared to 23 percent, 53 percent and 24 percent of total deposits as of March 31, 2025, respectively.

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Total estimated uninsured deposits, excluding collateralized government deposits and intercompany deposits (i.e., deposits eliminated in consolidation), totaled approximately $13.0 billion, or 26 percent of total deposits, at March 31, 2025 as compared to $12.6 billion, or 25 percent of total deposits, at December 31, 2024.

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Total estimated uninsured deposits, excluding collateralized government deposits and intercompany deposits (i.e., deposits eliminated in consolidation), totaled approximately $13.1 billion, or 26 percent of total deposits, at June 30, 2025 as compared to $13.0 billion, or 26 percent of total deposits, at March 31, 2025.

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Average long-term borrowings (including junior subordinated debentures issued to capital trusts which are presented separately on the consolidated statements of financial condition) decreased $227.9 million as compared to the fourth quarter 2024 and increased $380.5 million as compared to the first quarter 2024. The increase as compared to the first quarter 2024 was partly due to new FHLB advances totaling $1.0 billion issued in early March 2024, partially offset by the maturity and repayment of $273 million of FHLB advances in January 2025.

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Average short-term borrowings for the second quarter 2025 decreased $111.1 million from the first quarter 2025 and increased $99.0 million from the second quarter 2024. The decrease from the first quarter 2025 was mainly due to the maturity and repayment of FHLB advances. The increase from the second quarter 2024 was mostly driven by a greater use of short-term FHLB advances in our mix of funding sources during the second quarter 2025. Average long-term borrowings (including junior subordinated debentures issued to capital trusts which are presented separately on the consolidated statements of financial condition) increased $140.1 million as compared to the first quarter 2025 and decreased $172.8 million as compared to the second quarter 2024. The increase as compared to the first quarter 2025 was mainly due to new issuances of FHLB advances totaling $210.0 million in the second quarter

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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 net gains on sales of loans, wealth management and trust fees, and capital markets fees. These amounts can vary widely from period to period due to, among other factors, the amount and timing of residential mortgage loans originated for sale, brokerage and tax credit investment advisory activities and commercial loan customer demand for certain interest rate swap products. See the “Non-Interest Income” section below for more details.

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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 net gains on sales of loans, wealth management and trust fees, and capital markets income. These amounts can vary widely from period to period due to, among other factors, the amount and timing of residential mortgage loans originated for sale, brokerage and tax credit investment advisory activities and commercial loan customer demand for certain interest rate swap products. See the “Non-Interest Income” section below for more details.

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Average interest earning assets increased $272.9 million to $56.9 billion for the first quarter 2025 as compared to the first quarter 2024 mainly due to a $2.0 billion increase in average taxable investments largely resulting from purchases of residential mortgage-backed securities classified as available for sale over the past 12 months, largely offset by lower average loan balances. Compared to the fourth quarter 2024, average interest earning assets decreased by $1.3 billion during the first quarter 2025. The decrease was mainly driven by decreases of$1.1 billion and $831.1 million in average loans and overnight interest bearing cash balances, respectively, partially offset by an increase of $596.9 million in average taxable investments. The decrease inaverage loan balances to$48.7 billion for thefirst quarter 2025 wasmostly due to the bulk sale of certain performing CRE loans during the fourth quarter 2024 and continued CRE loan repayment activity. The decline in average overnight interest bearing cash balances was largely the result of excess funds from both loan sales and issuance of common stock in the fourth quarter 2024 used, in part, to repay maturing indirect customer time deposits and purchase taxable investment securities in thefirst quarter 2025.

Current wording

Average interest earning assets increased $780.7 million to $57.6 billion for the second quarter 2025 as compared to the second quarter 2024 mainly due to a $2.0 billion increase in average taxable investments largely resulting from purchases of residential mortgage-backed securities classified as available for sale over the past 12 months, largely offset by lower average loan balances and to a lesser extent lower excess liquidity held in overnight interest-bearing deposits with banks. Compared to the first quarter 2025, average interest earning assets increased by$661.9 million during the second quarter 2025. The increase was mainly driven by increases of $377.7 million in average loans, $42.4 million overnight interest bearing cash balances and an increase of $249.8 million in average taxable investments. The increase in average loan balances to $49.0 billion for the second quarter 2025 was mostly due to continued growth in the commercial and industrial loan portfolio.

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Average interest bearing liabilities decreased $325.9 million to $41.2 billion for the first quarter 2025 as compared to the first quarter 2024 primarily due to a decrease of$1.2 billion in average short-term borrowings, partially offset by increases of $523.9 million and $380.5 million in average interest bearing deposits and long-term borrowings, respectively. The $1.2 billion decrease in average short-term borrowings was mostly the result of a shift from the use of short-term FHLB advances to indirect customer time deposits in our mix of liquidity funding sources starting in the second quarter 2024. As compared to the fourth quarter 2024, average interest bearing liabilities decreased by $1.5 billion for the first quarter 2025 largely due to a decrease in average time deposit balances caused by the aforementioned repayment of maturing indirect customer time deposits. See additional information under“Deposits and Other Borrowings” in the Executive Summary section above.

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Average interest bearing liabilities increased $337.4 million to $41.9 billion for the second quarter 2025 as compared to the second quarter 2024 primarily due to increases of $411.2 million and $99.0 million in average interest bearing deposits and short-term borrowings, respectively, partially offset by a decrease of $172.8 million in long-term borrowings. As compared to the first quarter 2025, average interest bearing liabilities increased by$683.0 million for the second quarter 2025 largely due to an increase in average time deposit balances. See additional information under“Deposits and Other Borrowings” in the Executive Summary section above.

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In Valley's Annual Report, we provided guidance that we anticipated net interest income growth of approximately 9 to 12 percent for the full year of 2025 as compared to $1.6 billion reported for 2024. Based upon our current projections, we now expect the growth of our net interest income for 2025 to fall within the low-end of the 9 to 12 percent range largely due to lower anticipated loan growth and continued lending spread compression. Our forecasts include additional assumptions and, 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 2025. 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.

Current wording

In Valley's Annual Report, we provided guidance that we anticipated net interest income growth of approximately 9 to 12 percent for the full year of 2025 as compared to $1.6 billion reported for 2024. Based upon our current projections, we now expect the growth of our net interest income for 2025 to fall within a range of 8 to 10 percent range largely due to lower anticipated loan growth of 3 percent for same period. Our forecasts include additional assumptions and, therefore, we cannot provide any assurances that our future net interest income or margin will meet our current estimates or remain near the levels reported for the second quarter 2025. 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.

Previous wording

Non-interest income represented 12.2 percent and 13.5 percent of total net interest income plus non-interest income for the three months ended March 31, 2025 and 2024, respectively. For the three months ended March 31, 2025, non-interest income decreased $3.1 million as compared to the same quarter in 2024 mainly driven by lower gains on sales of assets and decreases in wealth management and trust fees and other income, partially offset by moderate increases in several other categories. See further details below.

Current wording

Non-interest income represented 12.6 percent and 11.3 percent of total net interest income plus non-interest income for the three months ended June 30, 2025 and 2024, respectively, and 12.4 percent of total interest income plus non-interest income for both the six months ended June 30, 2025 and 2024, respectively. For the three and six months ended June 30, 2025, non-interest income increased $11.4 million and $8.3 million, respectively, as compared to the same periods in 2024 mainly driven by increases in service charges on deposit accounts, capital markets income and bank owned life insurance income. See further details below.

Previous wording

The following table presents the components of non-interest income for the three months ended March 31, 2025 and 2024:

Current wording

The following table presents the components of non-interest income for the three and six months ended June 30, 2025 and 2024:

Previous wording

Capital markets income increased $1.3 million for the three months ended March 31, 2025 as compared to the same quarter in 2024 mostly due to an increase in the volume of interest rate swap transactions related to commercial lending activities.

Current wording

Capital markets income increased $2.0 million and $3.3 million for the three and six months ended June 30, 2025, respectively, as compared to the same periods in 2024. The increase for both periods was mostly due to fee growth from higher volumes of interest rate swap transactions related to commercial lending activities, as well as fees from foreign exchange and loan syndication transactions.

Previous wording

Service charges on deposit accounts increased $1.5 million for the three months ended March 31, 2025 as compared to the same quarter in 2024 mainly due to additional treasury service related fees for commercial deposit accounts.

Current wording

Service charges on deposit accounts increased $3.5 million and $5.0 million for the three and six months ended June 30, 2025, respectively, as compared to the same periods in 2024 mainly due to additional treasury service related fees for commercial deposit accounts, partially offset by lower overdraft fees.

Previous wording

Bank owned life insurance income increased $1.5 million for the three months ended March 31, 2025 as compared to the same quarter in 2024 due to higher returns on the underlying investment securities.

Current wording

Bank owned life insurance income increased $1.5 million and $3.0 million for the three and six months ended June 30, 2025, respectively, as compared to the same periods in 2024 due to higher returns on the underlying investment securities during the respective periods.

Previous wording

Net gains on sales of assets decreased $3.7 million for the three months ended March 31, 2025 as compared to the same quarter in 2024 primarily as a result of a $3.6 million net gain realized on the sale of our commercial premium finance lending business during the first quarter 2024.

Current wording

second quarter 2024 was mainly due to a $1.5 million increase in card fee income for three months ended June 30, 2025. The decrease for the six months ended June 30, 2025 was largely as a result of a $3.6 million net gain realized on the sale of our commercial premium finance lending business during the first quarter 2024.

Previous wording

The following table presents the components of non-interest expense for the three months ended March 31, 2025 and 2024:

Current wording

The following table presents the components of non-interest expense for the three and six months ended June 30, 2025 and 2024:

Previous wording

Net occupancy expense increased $1.6 million for the three months ended March 31, 2025 compared to the same quarter in 2024 mainly due to incremental increases in rent expense, cleaning and maintenance and property tax expenses.

Current wording

Net occupancy expense increased $1.2 million and $2.8 million for the three and six months ended June 30, 2025, respectively, as compared to the same periods in 2024 mainly due to incremental increases in cleaning and maintenance, rent expense and depreciation expense.

Previous wording

Technology, furniture and equipment expense decreased $5.6 million for the three months ended March 31, 2025 as compared to the same quarter of 2024, mostly due to a decrease in software licensing costs, as well as lower depreciation expense and telecommunication related expense.

Current wording

Technology, furniture and equipment expense decreased $4.5 million and $10.1 million for the three and six months ended June 30, 2025, respectively, as compared to the same periods in 2024. The decreases were mostly driven by a reduction in software licensing costs, as well as moderately lower depreciation and telecommunication related expenses.

Previous wording

FDIC insurance assessment expense decreased $5.4 million for the three months ended March 31, 2025 as compared to the same quarter of 2024 primarily due to FDIC special assessment expenses of $7.4 million recorded in the first quarter of 2024.

Current wording

FDIC insurance assessment expense decreased $2.3 million and $7.6 million for the three and six months ended June 30, 2025, respectively, as compared to the same periods of 2024. The decreases were primarily due to additional estimated expenses of $1.4 million and $8.8 million recorded during the three and six months ended June 30, 2024, respectively, related to the FDIC special assessment.