Valley National Bancorp "Top Self-Help Story - Assuming at Buy" (Buy) Braziler

研报英文原文证据摘录

Valley National Bancorp "Top Self-Help Story - Assuming at Buy" (Buy) Braziler

Reported NIM and NII improvement is the output, not the thesis

Figure 6 validates that the mechanics are already flowing through earnings, with NII

expanding and NIM holding at 3.17% in 1Q26 despite day-count pressure and lower

asset yields due to rate cut lag effect. The more important takeaway from 1Q EPS is what

drove the result: deposit cost relief, brokered runoff, lower borrowings, and continued

repricing on the asset side. That is a higher-quality margin story than simple cyclical

recovery because it reflects controllable balance sheet actions rather than only the

external rate environment.

FigureSource:Company7: VLY Filings,NII / NIMUBS ResearchrecoveryFigure FigureSource:Capital8: CostIQ, Companyof CDs Filings,vs. newUBS moneyResearch ratesFigure

The main pushback is deposit competition, but Valley does not need an

unusually benign deposit backdrop for the thesis to work

Funding competition remains intense, particularly in consumer CDs and promotional

products, and Valley is not immune from that pressure. Management acknowledged

using a 4% nine-month CD promotion in April (Figure 8 above), which lifted deposit

acquisition costs for the month (subsequently fell in May). But the broader point is that

consumer rate competition is not the center of Valley’s margin story. Roughly two-thirds

of the deposit base is commercial, and management emphasized that commercial

deposits are won through relationship, service, treasury management capability and

operating-account penetration, not rate alone.

The peer comparison should therefore be used as a risk check rather than the

foundation of the argument. Valley still has elevated funding costs and meaningful time