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The New Jersey bank offers cheap mortgage refis, but their fine print means that some customers end up paying additional interest or taxes — and complaining about the extra costs.
June 8
Valley National Bancorp's (VLY) second-quarter earnings slipped as the Wayne, N.J., company saw its expenses rise and recorded a higher provision for credit losses.
The $16 billion-asset company said Thursday that it earned $32.8 million in the quarter, down roughly 11% from a year earlier. Its earnings per share of 17 cents fell short of analysts’ estimates by one penny, according to Thomson Reuters.
Valley's shares tumbled more than 6% following the announcement, closing at $9.64 Thursday.
Noninterest expense rose 10%, to $91.5 million, from a year earlier, due to an increase in salary and employee benefits costs relating to
Valley's provision for credit losses was $7.4 million, up almost 23% from a year earlier, while net chargeoffs climbed 52%, to $10.4 million, year over year.
Nonperforming assets totaled $195.4 million, up more than 16% from Dec. 31 and almost 9% from the prior quarter. The increase from the first quarter was mostly due to one new nonaccrual commercial real estate loan totaling $11.8 million and a $7.4 million increase in the estimated fair value of nonaccrual debt securities.
Net interest income rose almost 4%, to $123.8 million, from a year earlier, primarily due to the large volume of new residential mortgage and commercial real estate loan originations. The growth was driven largely by refinancing activity. .
Noninterest income fell 28%, to $24 million, from a year earlier as net gains on securities transactions decreased almost 93%, to $1.2 million.
