Valley National Bancorp

Hello, and thank you for standing by. Welcome to Valley National Bancorp third quarter 2025 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 the question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. I would now like to turn the conference over to Andrew Giannetti. Please go ahead, sir.

Good morning, and welcome to Valley's third quarter 2025 earnings conference call. I am joined today by CEO Ira Robbins and CFO Travis Land. Our quarterly earnings release and supporting documents are available at valley.com. Reconciliations of any non-GAAP measures mentioned on the call can be found in today's earnings release. Please also note slide two of our earnings presentation, and remember that comments made today may include forward-looking statements about Valley National Bancorp and the banking industry. For more information on these forward-looking statements and associated risk factors, please refer to our SEC filings including Forms 8-K, 10-Q, and 10-K. With that, I'll turn the call over to Ira Robbins.

Thank you, Andrew. Value delivered strong results in the third quarter, reporting net income of approximately $163 million, or 28 cents per diluted chair. This is up from $133 million, or 22 cents, last quarter, and represents our highest level of quarterly profitability since the end of 2022. This performance reflects a significant operating momentum that has been building in our organization. This quarter's results were highlighted by robust core customer deposit growth, continued momentum in net interest income and fee income, disciplined expense control, and a meaningful reduction in credit costs. Our balance sheet remains extremely strong and we have achieved many of our stated profitability goals ahead of schedule, including annualized return on average assets being above 1%. Valley is well positioned in the current environment. In 2024, we enhanced our balance sheet and are now leveraging this strength to improve our profitability and franchise value. Today, I'm thrilled to formally introduce our new commercial and consumer banking leaders who we believe will help accelerate the next phase of our evolution and success. Gina Martocchi joined Valley in March as President of Commercial Banking, bringing extensive experience from M&T Bank, where he led national commercial and Cree banking efforts. Gina played a key role in M&T's growth and has already contributed his market knowledge, network, and strategic insight to support our commercial franchise's further development. In September, Patrick Smith joined as President of the Consumer Bank, following leadership roles at Santander, Capital One, and other large financial institutions. Patrick will oversee retail, consumer, and small business sectors, drawing on a notable record of growth and execution. Gino and Patrick are already making an incredible impact by enhancing our customer acquisition efforts, talent base, and strategic operating model. Their expertise helps position Valley to further leverage our strong foundation and accelerate our strategic initiatives. Before passing the call to Travis, let me highlight a few of the key areas of sustained momentum. First, ongoing growth in core deposits and funding transformation. Over the past 12 months, we've added nearly 110,000 new deposit accounts, which have contributed to nearly 10% core deposit growth. Targeted investments in products, technology, and talent, especially in commercial and specialty lines, have driven this progress. Consequently, indirect deposits as a percent of total deposits dropped from 18% to 11%, the lowest level since the third quarter of 2022. This has been achieved alongside a 56 basis point reduction in our average cost of deposits since the third quarter of 2024. We continue to actively manage deposit pricing in the back book and expect to benefit from lower deposit costs in the fourth quarter and into 2026. Secondly, non-interest income. Excluding volatile net gains on loans sold, Non-interest income has grown at an annual rate of 15% since 2017, three times faster than public trade appears in our size range. We spoke last quarter about our focused efforts with respect to treasury management and tax credit advisory opportunities. These initiatives collectively contribute roughly $3 million of incremental revenue during the third quarter. The success of our treasury management demonstrates our effective combination of technology and talent. The implementation of an upgraded platform following our core conversion two years ago, coupled with expanding our expert sales team, has resulted in nearly $16 million of incremental deposit service charge revenue on an annualized basis since the third quarter of 2024. Thirdly, the resilience of our credit performance Consistent with our guidance, we saw a significant reduction in net charge-offs and provisions during the third quarter. We expect to sustain these levels again in the fourth quarter. At the start of 2024, Valley was notably CRE heavy in a challenging environment. However, differentiated underwriting and credit management have limited aggregate CRE losses to just 57 basis points of average CRE loans over the last seven quarters. Although 2024 Cree charge-off rates were beyond our internal standards, loss rates have remained far below larger banks' more pessimistic stress test forecasts. From a CNI perspective, we continue to focus our growth efforts on traditional small business and middle market opportunities in our well-known geographies and established specialty verticals. As I mentioned last quarter, we have specifically targeted the healthcare CNI and capital call line areas giving their compelling risk-adjusted return profiles. We've been active in both verticals for some time, and we have never taken a loss on a value-originated healthcare CNI or capital call loan. I am extremely proud of our organization's achievements over the past few years, and I'm highly optimistic about our future prospects. The bank continues to demonstrate exceptional momentum with respect to customer growth, talent acquisition, and profitability. We have set ambitious goals for ourselves and are confident that continued execution of our strategic initiatives will deliver substantial value to our associates, shareholders, and clients. With that, I would turn the call over to Travis to discuss this course's financial highlights. After Travis concludes his remarks, Gino, Patrick, Travis, Mark Sager, and I will be available for your questions.