Valley National Bancorp

Good day and thank you for standing by. Welcome to the Q1 2025 Valley National Bancorp earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 11 on your telephone. You will then hear an automated message advising you your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Travis Lamb. Please go ahead.

Good morning, and welcome to Valley's first quarter 2025 earnings conference call. I'm joined today by CEO Ira Robbins and Chief Credit Officer Mark Sager. Before we begin, I would like to make everyone aware that our quarterly earnings release and supporting documents can be found on our company website at valley.com. When discussing our results, we refer to non-GAAP measures which exclude certain items from reported results. Please refer to today's earnings release for reconciliations of these non-GAAP measures. Additionally, I would like to highlight slide two of our earnings presentation and remind you that comments made during this call may contain forward-looking statements relating to Valley National Bank Corp. and the banking industry. Valley encourages all participants to refer to our SEC filings, including those found on Forms 8-K, 10Q and 10K for a complete discussion of forward-looking statements and the factors that could cause actual results to differ from those statements. With that, I'll turn the call over to Ira Robbins.

Thank you, Travis. During the first quarter of 2025, net income on both a reported and adjusted basis was approximately $106 million, or $0.18 per diluted share. This compared to $116 million and $0.20 on a reported basis or 76 million and 13 cents on an adjusted basis a quarter ago. The sequential growth in adjusted earnings reflects revenue stability, lower operating expenses, and a smaller loan loss provision. Clearly, much has changed since we spoke to you three months ago. Tariff uncertainty has driven most economic growth estimates lower, while inflation expectations are rising. Volatility in the interest rate in equity markets has increased, and the market now anticipates more cuts during the year. Despite this backdrop, we feel well-positioned to improve further on this quarter's results. While our commercial real estate exposure has been a focus over the last 18 months, this sizable portfolio is relatively insulated from potential tariff disruption, and our ongoing CRE credit improvement should continue. More broadly, our commercial customers remain generally resolute with little direct exposure to the import and export business expected to be impacted by changing tariff policy. From a growth perspective, our consistent CNI expansion has primarily come from small and middle market businesses where demand continues to percolate. While increased competition has resulted in incremental spread compression, we are optimistic that we have sufficient opportunity to grow profitability throughout the year. As such, there are no changes to our return expectations on slide five. On slide six, we do provide a more granular directional update to the 2025 guidance items that we presented a few months ago. We anticipate that both loan growth and net interest income will be at the lower end of our expected range for 2025. However, this should be mostly offset by non-interest expenses coming in towards the low end as well. There's no meaningful adjustment to our expectations for annual fee income or our tax rate. While charges and provisions were both somewhat elevated during the quarter, there is no change to our full year expectations for a roughly 50% decline in each metric from 2024. Slide seven illustrates the long-term value that we continue to create for our stakeholders. Our tangible book value inclusive of dividends has now doubled in the last seven years, and our rate of growth continues to outpace peers. We remain focused on organic customer acquisition in both the commercial and consumer areas. These customers represent longer-term revenue opportunities and will contribute meaningfully to the future performance of our institution. As we have continually discussed, we are a much more diverse bank today than when I took over as CEO. Our evolution into new business lines and geographies has created opportunities that were previously unavailable to us. We continue to evolve with an internal focus on optimizing our operations, customer network, and balance sheet to become a better, more profitable bank for our employees, our clients, and our shareholders. While economic uncertainty may present incremental headwinds for the industry, I am confident that Valley is well positioned to navigate this most recent period of disruption as we continue to execute on our strategic imperatives. With that, I will turn the call back to Travis to discuss the quarter's financial highlights As Travis concludes his remark, Mark, Travis, and I will be available for your questions.