v3.26.1
Loans and Allowance for Credit Losses for Loans
 6 Months Ended
Jun. 30, 2026
Receivables [Abstract]  
Loans and Allowance for Credit Losses for Loans Loans and Allowance for Credit Losses for Loans
The details of the loan portfolio as of June 30, 2026 and December 31, 2025 were as follows: 
June 30, 2026December 31, 2025
(in thousands)
Loans:
Commercial and industrial$11,961,242 $10,961,519 
Commercial real estate:
Commercial real estate27,873,726 26,772,749 
Construction2,475,109 2,471,233 
Total commercial real estate loans30,348,835 29,243,982 
Residential mortgage5,982,941 5,826,192 
Consumer:
Home equity728,623 687,680 
Automobile2,150,089 2,184,600 
Other consumer1,295,521 1,232,755 
Total consumer loans4,174,233 4,105,035 
Total loans$52,467,251 $50,136,728 
Total loans include net unearned discounts and deferred loan fees of $19.9 million and $17.4 million at June 30, 2026 and December 31, 2025, respectively.
Accrued interest on loans, which is excluded from the amortized cost of loans held for investment, totaled $215.3 million and $209.5 million at June 30, 2026 and December 31, 2025, respectively, and is presented within total accrued interest receivable on the consolidated statements of financial condition.
Loan Portfolio Sales and Transfers to Loans Held for Sale
There were no transfers of loans from the held for investment loan portfolio to loans held for sale during the six months ended June 30, 2026. During the first quarter of 2026, Valley sold a non-performing commercial real estate loan relationship totaling $9.1 million that was transferred from the held for investment loan portfolio to loans held for sale during the fourth quarter of 2025. The sale resulted in the recognition of a $767 thousand net gain during the six months ended June 30, 2026. See Valley’s Annual Report for details regarding transfers and sales of loans for the year ended December 31, 2025.
Credit Risk Management
Valley adheres to a credit policy designed to minimize credit risk while generating the maximum income given the level of risk appetite. Management reviews and approves these policies and procedures on a regular basis with subsequent approval by the Board annually. Credit authority relating to a significant dollar percentage of the overall portfolio is centralized and controlled by the Credit Risk Management Division and by the Credit Committee. Loan portfolio diversification is an important factor utilized by Valley to manage its risk across business sectors and through cyclical economic circumstances. Additionally, Valley does not accept crypto assets as loan collateral for any of its loan portfolio classes. See Valley’s Annual Report for further details.
Credit Quality
The following table presents past due, current, and non-accrual loans without an allowance for loan losses by loan portfolio class at June 30, 2026 and December 31, 2025:
Past Due and Non-Accrual Loans
30-59  Days 
Past Due Loans		60-89  Days 
Past Due Loans		90 Days or More
Past Due Loans		Non-Accrual Loans
Total Past Due Loans
Current Loans
Total Loans		Non-Accrual Loans Without Allowance for Loan Losses
(in thousands)
June 30, 2026
Commercial and industrial
$5,083 $2,748 $3,527 $147,731 $159,089 $11,802,153 $11,961,242 $16,428 
Commercial real estate:
Commercial real estate
106,034 — 5,454 256,081 367,569 27,506,157 27,873,726 194,607 
Construction1,752 — — 9,139 10,891 2,464,218 2,475,109 — 
Total commercial real estate loans107,786 — 5,454 265,220 378,460 29,970,375 30,348,835 194,607 
Residential mortgage22,154 6,495 5,223 42,992 76,864 5,906,077 5,982,941 29,237 
Consumer loans:
Home equity1,379 97 — 6,460 7,936 720,687 728,623 2,622 
Automobile9,119 2,814 1,007 210 13,150 2,136,939 2,150,089 — 
Other consumer5,476 993 855 16 7,340 1,288,181 1,295,521 — 
Total consumer loans15,974 3,904 1,862 6,686 28,426 4,145,807 4,174,233 2,622 
Total$150,997 $13,147 $16,066 $462,629 $642,839 $51,824,412 $52,467,251 $242,894 
Past Due and Non-Accrual Loans

30-59
Days
Past Due Loans		60-89 
Days
Past Due Loans		90 Days or More
Past Due Loans		Non-Accrual Loans
Total Past Due Loans
Current Loans		Total LoansNon-Accrual Loans Without Allowance for Loan Losses
(in thousands)
December 31, 2025
Commercial and industrial$11,177 $1,274 $— $138,321 $150,772 $10,810,747 $10,961,519 $21,132 
Commercial real estate:
Commercial real estate72,810 — 212 236,221 309,243 26,463,506 26,772,749 177,372 
Construction— — — 9,140 9,140 2,462,093 2,471,233 — 
Total commercial real estate loans72,810 — 212 245,361 318,383 28,925,599 29,243,982 177,372 
Residential mortgage21,615 10,181 3,300 44,424 79,520 5,746,672 5,826,192 28,320 
Consumer loans:
Home equity1,813 620 — 5,530 7,963 679,717 687,680 2,008 
Automobile10,827 1,328 611 279 13,045 2,171,555 2,184,600 — 
Other consumer1,780 3,321 459 23 5,583 1,227,172 1,232,755 — 
Total consumer loans14,420 5,269 1,070 5,832 26,591 4,078,444 4,105,035 2,008 
Total$120,022 $16,724 $4,582 $433,938 $575,266 $49,561,462 $50,136,728 $228,832 
Credit quality indicators. Valley utilizes an internal loan classification system as a means of reporting problem loans within commercial and industrial, commercial real estate, and construction loan portfolio classes. Under Valley’s internal risk rating system, loan relationships could be classified as “Pass,” “Special Mention,” “Substandard,” “Doubtful,” or “Loss.” Substandard loans include loans that exhibit well-defined weakness and are characterized by the distinct possibility that Valley will sustain some loss if the deficiencies are not corrected. Loans classified as Doubtful have all the weaknesses inherent in those classified as Substandard with the added characteristic that the weaknesses present make collection or liquidation in full, based on currently existing facts, conditions and values, highly questionable and improbable. Loans classified as Loss are those considered uncollectible with insignificant value and are charged-off immediately to the allowance for loan losses and, therefore, not presented in the table below. Loans that do not currently pose a sufficient risk to warrant classification in one of the aforementioned categories but pose weaknesses that deserve management’s close attention are deemed Special Mention. Pass rated loans do not currently pose any identified risk and can range from the highest to average quality, depending on the degree of potential risk. Risk ratings are updated any time the situation warrants.
The following table presents the internal loan classification risk by loan portfolio class by origination year based on the most recent analysis performed at June 30, 2026 and December 31, 2025, as well as the gross loan charge-offs by year of origination for the six months ended June 30, 2026 and for the year ended December 31, 2025:
Term Loans
Amortized Cost Basis by Origination Year
June 30, 202620262025202420232022
Prior to 2022
Revolving Loans Amortized Cost BasisRevolving Loans Converted to Term LoansTotal
(in thousands)
Commercial and industrial
Risk Rating:
Pass$983,702 $1,324,496 $1,066,910 $536,920 $486,773 $820,951 $6,051,460 $6,532 $11,277,744 
Special Mention— 2,202 15,738 25,977 12,704 17,989 115,345 7,156 197,111 
Substandard3,503 9,068 41,456 31,125 57,415 79,516 190,335 26,987 439,405 
Doubtful— — — 4,096 — 42,044 842 — 46,982 
Total commercial and industrial$987,205 $1,335,766 $1,124,104 $598,118 $556,892 $960,500 $6,357,982 $40,675 $11,961,242 
Commercial real estate
Risk Rating:
Pass$2,671,281 $3,202,290 $1,529,892 $2,313,592 $4,706,311 $10,069,598 $482,388 $9,526 $24,984,878 
Special Mention1,911 7,637 139,063 181,535 254,143 374,659 92,553 30,613 1,082,114 
Substandard— 3,938 34,500 151,316 351,101 1,122,826 97,296 — 1,760,977 
Doubtful— — — — — 45,757 — — 45,757 
Total commercial real estate$2,673,192 $3,213,865 $1,703,455 $2,646,443 $5,311,555 $11,612,840 $672,237 $40,139 $27,873,726 
Construction
Risk Rating:
Pass$339,346 $736,849 $350,644 $215,951 $208,217 $102,005 $331,133 $— $2,284,145 
Special Mention— 4,495 16,358 — 1,160 13,219 57,639 6,895 99,766 
Substandard— — 389 — 39,857 10,178 7,783 32,991 91,198 
Total construction$339,346 $741,344 $367,391 $215,951 $249,234 $125,402 $396,555 $39,886 $2,475,109 
Gross loan charge-offs $— $232 $1,820 $733 $567 $32,601 $4,857 $— $40,810 
Term Loans
Amortized Cost Basis by Origination Year
December 31, 202520252024202320222021
Prior to 2021
Revolving Loans Amortized Cost BasisRevolving Loans Converted to Term LoansTotal
(in thousands)
Commercial and industrial
Risk Rating:
Pass$1,501,570 $1,333,581 $676,608 $511,649 $343,565 $500,972 $5,438,418 $8,600 $10,314,963 
Special Mention1,475 13,426 4,767 18,941 10,050 13,064 151,511 6,964 220,198 
Substandard3,071 4,735 26,196 60,885 3,327 78,607 172,627 23,988 373,436 
Doubtful— — 4,717 — — 46,631 1,574 — 52,922 
Total commercial and industrial$1,506,116 $1,351,742 $712,288 $591,475 $356,942 $639,274 $5,764,130 $39,552 $10,961,519 
Commercial real estate
Risk Rating:
Pass$3,179,469 $1,802,585 $2,501,008 $4,926,062 $3,406,631 $7,387,804 $576,394 $20,952 $23,800,905 
Special Mention4,617 90,876 218,532 154,578 112,038 305,609 116,595 30,943 1,033,788 
Substandard— 98,560 175,780 312,117 365,371 818,034 125,261 — 1,895,123 
Doubtful— — 3,060 — 29,133 10,740 — — 42,933 
Total commercial real estate$3,184,086 $1,992,021 $2,898,380 $5,392,757 $3,913,173 $8,522,187 $818,250 $51,895 $26,772,749 
Construction
Risk Rating:
Pass$712,797 $494,598 $215,960 $266,072 $50,397 $50,442 $368,005 $17,474 $2,175,745 
Special Mention4,261 31,142 9,329 2,859 28,205 — 78,494 6,973 161,263 
Substandard— 390 — 39,077 1,638 8,535 51,620 32,965 134,225 
Total construction$717,058 $526,130 $225,289 $308,008 $80,240 $58,977 $498,119 $57,412 $2,471,233 
Gross loan charge-offs$1,979 $7,048 $4,031 $21,122 $15,471 $29,715 $23,458 $15,921 $118,745 
For residential mortgage, home equity, automobile and other consumer loan portfolio classes, Valley evaluates credit quality based on the aging status of the loan and by payment activity. The following table presents the amortized cost in those loan classes based on payment activity by origination year as of June 30, 2026 and December 31, 2025, as well as the gross loan charge-offs by year of origination for the six months ended June 30, 2026 and for the year ended December 31, 2025:
Term Loans
Amortized Cost Basis by Origination Year
June 30, 202620262025202420232022
Prior to 2022
Revolving Loans Amortized Cost BasisRevolving Loans Converted to Term LoansTotal
(in thousands)
Residential mortgage
Performing$406,564 $598,212 $353,938 $360,693 $1,178,351 $2,986,001 $77,029 $7 $5,960,795 
90 days or more past due— 515 4,816 1,986 1,331 12,817 — 681 22,146 
Total residential mortgage $406,564 $598,727 $358,754 $362,679 $1,179,682 $2,998,818 $77,029 $688 $5,982,941 
Consumer loans
Home equity
Performing$11,863 $22,202 $15,802 $21,014 $30,915 $57,169 $560,780 $6,259 $726,004 
90 days or more past due— — 244 324 1,089 710 15 237 2,619 
Total home equity11,863 22,202 16,046 21,338 32,004 57,879 560,795 6,496 728,623 
Automobile
Performing$426,951 $863,060 $473,798 $168,441 $149,041 $67,450 $— $— $2,148,741 
90 days or more past due61 660 229 153 115 130 — — 1,348 
Total automobile427,012 863,720 474,027 168,594 149,156 67,580 — — 2,150,089 
Other consumer
Performing$2,344 $3,551 $8,973 $15,385 $11,063 $72,522 $1,169,259 $11,783 $1,294,880 
90 days or more past due5 15 6 — 42 18 491 64 641 
Total other consumer2,349 3,566 8,979 15,385 11,105 72,540 1,169,750 11,847 1,295,521 
Total consumer$441,224 $889,488 $499,052 $205,317 $192,265 $197,999 $1,730,545 $18,343 $4,174,233 
Gross loan charge-offs $26 $1,300 $997 $575 $346 $3,336 $— $37 $6,617 
Term Loans
Amortized Cost Basis by Origination Year
December 31, 202520252024202320222021
Prior to 2021
Revolving Loans Amortized Cost BasisRevolving Loans Converted to Term LoansTotal
(in thousands)
Residential mortgage
Performing$604,433 $373,656 $384,909 $1,222,224 $1,339,378 $1,792,530 $83,562 $— $5,800,692 
90 days or more past due— 3,829 1,053 1,956 4,435 13,546 — 681 25,500 
Total residential mortgage $604,433 $377,485 $385,962 $1,224,180 $1,343,813 $1,806,076 $83,562 $681 $5,826,192 
Consumer loans
Home equity
Performing$23,659 $18,041 $23,970 $33,368 $9,142 $51,005 $518,208 $7,566 $684,959 
90 days or more past due— 98 498 1,004 — 558 — 563 2,721 
Total home equity23,659 18,139 24,468 34,372 9,142 51,563 518,208 8,129 687,680 
Automobile
Performing$1,036,932 $594,866 $219,316 $209,781 $98,805 $24,078 $— $— $2,183,778 
90 days or more past due170 184 137 85 79 167 — — 822 
Total automobile1,037,102 595,050 219,453 209,866 98,884 24,245 — — 2,184,600 
Other consumer
Performing$5,327 $10,098 $17,242 $12,441 $4,563 $62,516 $1,100,473 $19,962 $1,232,622 
90 days or more past due— — 5 2 — 17 — 109 133 
Total other consumer5,327 10,098 17,247 12,443 4,563 62,533 1,100,473 20,071 1,232,755 
Total consumer$1,066,088 $623,287 $261,168 $256,681 $112,589 $138,341 $1,618,681 $28,200 $4,105,035 
Gross loan charge-offs$760 $2,181 $1,163 $1,041 $466 $2,727 $— $625 $8,963 
Loan modifications to borrowers experiencing financial difficulty. From time to time, Valley may extend, restructure, or otherwise modify the terms of existing loans, on a case-by-case basis, to remain competitive and retain certain customers, as well as assist other customers who may be experiencing financial difficulties.
The following tables present the amortized cost basis of loans to borrowers experiencing financial difficulty at June 30, 2026 that were modified during the three and six months ended June 30, 2026 and 2025, disaggregated by class of financing receivable and type of modification.
Interest rate reductionTerm ExtensionTerm extension and interest rate reductionTerm Extension and Principal ForgivenessOther than Insignificant Payment DelayTotal% of Total Loan Class
($ in thousands)
Three Months Ended
June 30, 2026
Commercial and industrial$— $20,704 $7,394 $— $— $28,098 0.23 %
Commercial real estate74 7,713 — — 108,184 115,971 0.42 
Residential mortgage— — — — 80 80 — 
Total$74 $28,417 $7,394 $— $108,264 $144,149 0.27 %
Three Months Ended
June 30, 2025
Commercial and industrial$— $8,306 $— $— $— $8,306 0.08 %
Commercial real estate— 3,020 4,008 — — 7,028 0.03 
Total$— $11,326 $4,008 $— $— $15,334 0.03 %
Six Months Ended
June 30, 2026
Commercial and industrial$— $72,798 $7,394 $— $17,737 $97,929 0.82 %
Commercial real estate74 7,713 — — 108,639 116,426 0.42 
Residential mortgage— 1,115 — — 502 1,617 0.03 
Home equity— — — — 25 25 — 
Total$74 $81,626 $7,394 $— $126,903 $215,997 0.41 %
Six Months Ended
June 30, 2025
Commercial and industrial$— $10,304 $— $— $5,610 $15,914 0.15 %
Commercial real estate— 10,413 4,008 20,760 396 35,577 0.14 
Total$— $20,717 $4,008 $20,760 $6,006 $51,491 0.10 %
The following table describes the types of modifications made to borrowers experiencing financial difficulty during the three and six months ended June 30, 2026 and 2025:
Weighted Average Interest Rate Reduction Weighted Average Term Extension (in months)Principal Forgiveness (in thousands)Weighted Average Payment Deferral (in months)
Three Months Ended
June 30, 2026
Commercial and industrial4.75 %11$— —
Commercial real estate2.50 13— 8
Residential mortgage— — — 12
Three Months Ended
June 30, 2025
Commercial and industrial— %18$— —
Commercial real estate5.50 3— —
Six Months Ended
June 30, 2026
Commercial and industrial4.75 %43$— 10
Commercial real estate2.50 13— 8
Residential mortgage— 60— 9
Home equity— —— 6
Six Months Ended
June 30, 2025
Commercial and industrial— %17$— 6
Commercial real estate5.50 2617,500 *6
*    Relates to one loan that was partially charged off during the fourth quarter 2024 with the subsequent execution of the corresponding principal forgiveness completed in the first quarter 2025.
Valley closely monitors the performance of modified loans to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. The following table presents the aging analysis of loans that have been modified within the previous 12 months at June 30, 2026 and 2025.
Current30-89 Days Past Due90 Days or More Past Due Total
June 30, 2026(in thousands)
Commercial and industrial$135,968 *$— $— $135,968 
Commercial real estate133,996 *— 5,454 139,450 
Residential mortgage2,528 *906 — 3,434 
Home equity26— — 26 
Total$272,518 $906 $5,454 $278,878 
June 30, 2025
Commercial and industrial$75,699 *$— $— $75,699 
Commercial real estate250,109 *— — 250,109 
Residential mortgage1,187 *— 95 *1,282 
Home equity40 — — 40 
Total$327,035 $— $95 $327,130 
*    Includes non-accrual loans.
The following table provides the amortized cost basis of loans to borrowers experiencing financial difficulty that had a payment default during the six months ended June 30, 2026 and were modified in the 12 months before the default. There were no payment defaults of such loans during the six months ended June 30, 2025.
Term Extension
Six Months Ended June 30, 2026
Commercial real estate$5,454 
Total$5,454 
Loans in process of foreclosure. OREO balance totaled $4.1 million and $4.5 million at June 30, 2026 and December 31, 2025, respectively. Residential mortgage and consumer loans secured by residential real estate properties for which formal foreclosure proceedings are in process totaled $3.0 million and $3.4 million at June 30, 2026 and December 31, 2025, respectively.
Collateral dependent loans. Loans are collateral dependent when the debtor is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral. When Valley determines that repayment or satisfaction of the loan depends on the sale of the collateral, the collateral dependent loan balances are written down to the estimated current fair value (less estimated selling costs) resulting in an immediate charge-off to the allowance, excluding any consideration for personal guarantees that may be pursued in the Bank’s collection process.
The following table presents collateral dependent loans by class as of June 30, 2026 and December 31, 2025:
June 30,
2026		December 31,
2025
(in thousands)
Collateral dependent loans:
Commercial and industrial *$164,930 $159,594 
Commercial real estate250,548 225,982 
Residential mortgage29,483 28,569 
Home equity2,622 2,008 
Total $447,583 $416,153 
*    Includes non-accrual loans collateralized by taxi medallions totaling $42.5 million and $47.1 million at June 30, 2026 and December 31, 2025, respectively.
Allowance for Credit Losses for Loans
The allowance for credit losses for loans consists of the allowance for loan losses and the allowance for unfunded credit commitments.
The following table summarizes the ACL for loans at June 30, 2026 and December 31, 2025: 
June 30,
2026		December 31,
2025
(in thousands)
Components of allowance for credit losses for loans:
Allowance for loan losses$590,600 $583,400 
Allowance for unfunded credit commitments16,320 12,700 
Total allowance for credit losses for loans$606,920 $596,100 
The following table summarizes the provision for credit losses for loans for the periods indicated:
Three Months Ended
June 30,		Six Months Ended
June 30,
2026202520262025
(in thousands)
Components of provision for credit losses for loans:
Provision for loan losses$28,146 $39,129 $46,790 $100,428 
Provision (credit) for unfunded credit commitments1,020 (1,334)3,620 42 
Total provision for credit losses for loans$29,166 $37,795 $50,410 $100,470 
The following table details the activity in the allowance for loan losses by portfolio segment for the three and six months ended June 30, 2026 and 2025: 
Commercial
and Industrial		Commercial
Real Estate		Residential
Mortgage		ConsumerTotal
(in thousands)
Three Months Ended
June 30, 2026
Allowance for loan losses:
Beginning balance$186,143 $324,793 $51,700 $21,864 $584,500 
Loans charged-off(9,838)(14,434)— (3,354)(27,626)
Charged-off loans recovered 1,669 2,790 41 1,080 5,580 
Net (charge-offs) recoveries(8,169)(11,644)41 (2,274)(22,046)
Provision (credit) for loan losses20,936 5,919 (2,836)4,127 28,146 
Ending balance$198,910 $319,068 $48,905 $23,717 $590,600 
Three Months Ended
June 30, 2025
Allowance for loan losses:
Beginning balance$184,700 $321,662 $48,906 $22,932 $578,200 
Loans charged-off (25,189)(14,623)(46)(2,213)(42,071)
Charged-off loans recovered 2,789 643 37 773 4,242 
Net charge-offs(22,400)(13,980)(9)(1,440)(37,829)
Provision (credit) for loan losses11,115 27,297 (67)784 39,129 
Ending balance$173,415 $334,979 $48,830 $22,276 $579,500 
Six Months Ended
June 30, 2026
Allowance for loan losses:
Beginning balance$180,865 $327,426 $53,529 $21,580 $583,400 
Loans charged-off(12,620)(28,190)— (6,617)(47,427)
Charged-off loans recovered 3,067 3,137 124 1,509 7,837 
Net (charge-offs) recoveries(9,553)(25,053)124 (5,108)(39,590)
Provision (credit) for loan losses27,598 16,695 (4,748)7,245 46,790 
Ending balance$198,910 $319,068 $48,905 $23,717 $590,600 
Six Months Ended
June 30, 2025
Allowance for loan losses:
Beginning balance$173,002 $304,148 $58,895 $22,805 $558,850 
Loans charged-off (53,645)(28,046)(46)(4,353)(86,090)
Charged-off loans recovered 3,599 892 205 1,616 6,312 
Net (charge-offs) recoveries(50,046)(27,154)159 (2,737)(79,778)
Provision (credit) for loan losses50,459 57,985 (10,224)2,208 100,428 
Ending balance$173,415 $334,979 $48,830 $22,276 $579,500 
The following table represents the allocation of the allowance for loan losses and the related loans by loan portfolio segment disaggregated based on the allowance measurement methodology at June 30, 2026 and December 31, 2025.
Commercial and IndustrialCommercial
Real Estate		Residential
Mortgage		ConsumerTotal
(in thousands)
June 30, 2026
Allowance for loan losses:
Individually evaluated for credit losses$79,405 $11,116 $20 $— $90,541 
Collectively evaluated for credit losses119,505 307,952 48,885 23,717 500,059 
Total$198,910 $319,068 $48,905 $23,717 $590,600 
Loans:
Individually evaluated for credit losses$164,930 $250,548 $29,483 $2,622 $447,583 
Collectively evaluated for credit losses11,796,312 30,098,287 5,953,458 4,171,611 52,019,668 
Total$11,961,242 $30,348,835 $5,982,941 $4,174,233 $52,467,251 
December 31, 2025
Allowance for loan losses:
Individually evaluated for credit losses$71,188 $10,777 $22 $— $81,987 
Collectively evaluated for credit losses109,677 316,649 53,507 21,580 501,413 
Total$180,865 $327,426 $53,529 $21,580 $583,400 
Loans:
Individually evaluated for credit losses$159,594 $225,982 $28,569 $2,008 $416,153 
Collectively evaluated for credit losses10,801,925 29,018,000 5,797,623 4,103,027 49,720,575 
Total$10,961,519 $29,243,982 $5,826,192 $4,105,035 $50,136,728