
	June 30, 2021		December 31, 2020
	(in thousands)
Loans:
Commercial and industrial:
Commercial and industrial	$	4,733,771	$	4,709,569
Commercial and industrial PPP loans *	1,350,684		2,152,139
Total commercial and industrial loans	6,084,455		6,861,708
Commercial real estate:
Commercial real estate	17,512,142		16,724,998
Construction	1,752,838		1,745,825
Total commercial real estate loans	19,264,980		18,470,823
Residential mortgage	4,226,975		4,183,743
Consumer:
Home equity	410,856		431,553
Automobile	1,531,262		1,355,955
Other consumer	938,926		913,330
Total consumer loans	2,881,044		2,700,838
Total loans	$	32,457,454	$	32,217,112

Total loans includes net unearned discounts and deferred loan fees of $86.1 million and $95.8 million at June 30, 2021 and December 31, 2020, respectively. Net unearned discounts and deferred loan fees include the non-credit discount on purchased credit deterioration (PCD) loans and net unearned fees related to PPP loans at June 30, 2021 and December 31, 2020.

Valley transferred and sold approximately $30.0 million of residential mortgage loans from the loan portfolio to loans held for sale during the six months ended June 30, 2020. Excluding the loan transfers, there were no other material sales of loans from the held for investment portfolio during the three and six months ended June 30, 2021 and 2020.

For all of its loan types, 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 of Directors 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. A reporting system supplements the management review process by providing management with frequent reports concerning loan production, loan quality, internal loan classification,

concentrations of credit, loan delinquencies, non-performing, and potential problem loans. Loan portfolio diversification is an important factor utilized by Valley to manage its risk across business sectors and through cyclical economic circumstances. See Valley’s Annual Report on Form 10-K for the year ended December 31, 2020 for further details.


	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 Credit Losses
	(in thousands)
June 30, 2021
Commercial and industrial	$	3,867	$	1,361	$	2,351	$	102,594	$	110,173	$	5,974,282	$	6,084,455	$	9,550
Commercial real estate:
Commercial real estate	40,524		11,451		1,948		58,893		112,816		17,399,326		17,512,142		37,116
Construction	—		—		—		17,660		17,660		1,735,178		1,752,838		—
Total commercial real estate loans	40,524		11,451		1,948		76,553		130,476		19,134,504		19,264,980		37,116
Residential mortgage	8,479		1,608		956		35,941		46,984		4,179,991		4,226,975		16,807
Consumer loans:
Home equity	592		325		—		4,431		5,348		405,508		410,856		48
Automobile	5,521		636		441		389		6,987		1,524,275		1,531,262		—
Other consumer	129		24		22		104		279		938,647		938,926		—
Total consumer loans	6,242		985		463		4,924		12,614		2,868,430		2,881,044		48
Total	$	59,112	$	15,405	$	5,718	$	220,012	$	300,247	$	32,157,207	$	32,457,454	$	63,521


	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 Credit Losses
	(in thousands)
December 31, 2020
Commercial and industrial	$	6,393	$	2,252	$	9,107	$	106,693	$	124,445	$	6,737,263	$	6,861,708	$	4,075
Commercial real estate:
Commercial real estate	35,030		1,326		993		46,879		84,228		16,640,770		16,724,998		32,416
Construction	315		—		—		84		399		1,745,426		1,745,825		—
Total commercial real estate loans	35,345		1,326		993		46,963		84,627		18,386,196		18,470,823		32,416
Residential mortgage	17,717		10,351		3,170		25,817		57,055		4,126,688		4,183,743		11,610
Consumer loans:
Home equity	953		492		—		4,936		6,381		425,172		431,553		50
Automobile	8,056		1,107		245		338		9,746		1,346,209		1,355,955		—
Other consumer	1,248		224		26		535		2,033		911,297		913,330		—
Total consumer loans	10,257		1,823		271		5,809		18,160		2,682,678		2,700,838		50
Total	$	69,712	$	15,752	$	13,541	$	185,282	$	284,287	$	31,932,825	$	32,217,112	$	48,151

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," and "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. Loans rated as Pass 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.


	Term Loans
	Amortized Cost Basis by Origination Year
June 30, 2021	2021		2020		2019		2018		2017		Prior to 2017		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans		Total
	(in thousands)
Commercial and industrial
Risk Rating:
Pass	$	1,539,921	$	1,227,478	$	508,228	$	438,246	$	162,119	$	409,413	$	1,571,927	$	225	$	5,857,557
Special Mention	1,282		1,550		1,476		11,182		2,159		17,041		59,376		64		94,130
Substandard	3,325		8,658		4,366		8,803		859		1,374		17,141		321		44,847
Doubtful	129		—		2,739		—		16,370		68,683		—		—		87,921

Total commercial and industrial	$	1,544,657	$	1,237,686	$	516,809	$	458,231	$	181,507	$	496,511	$	1,648,444	$	610	$	6,084,455
Commercial real estate
Risk Rating:
Pass	$	2,100,741	$	3,055,880	$	2,875,727	$	2,005,122	$	1,552,673	$	4,978,293	$	174,277	$	12,849	$	16,755,562
Special Mention	2,000		51,271		58,418		44,118		43,019		184,694		38,615		—		422,135
Substandard	849		22,209		32,935		39,756		73,103		162,866		2,531		—		334,249
Doubtful	—		—		—		—		—		196		—		—		196

Total commercial real estate	$	2,103,590	$	3,129,360	$	2,967,080	$	2,088,996	$	1,668,795	$	5,326,049	$	215,423	$	12,849	$	17,512,142
Construction
Risk Rating:
Pass	$	112,491	$	147,431	$	87,130	$	78,332	$	6,656	$	29,216	$	1,251,972	$	—	$	1,713,228
Special Mention	—		—		1,026		—		—		1,714		8,871		—		11,611
Substandard	—		28		16		331		—		17,842		9,782		—		27,999

Total construction	$	112,491	$	147,459	$	88,172	$	78,663	$	6,656	$	48,772	$	1,270,625	$	—	$	1,752,838

For residential mortgages, automobile, home equity and other consumer loan portfolio classes, Valley also evaluates credit quality based on the aging status of the loan, which was previously presented, 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, 2021 and December 31, 2020.


	Term Loans
	Amortized Cost Basis by Origination Year
June 30, 2021	2021		2020		2019		2018		2017		Prior to 2017		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans		Total
	(in thousands)
Residential mortgage
Performing	$	687,724	$	701,963	$	671,803	$	519,568	$	446,367	$	1,108,317	$	68,012	$	—	$	4,203,754
90 days or more past due	—		1,719		1,852		2,021		3,907		13,722		—		—		23,221
Total residential mortgage	$	687,724	$	703,682	$	673,655	$	521,589	$	450,274	$	1,122,039	$	68,012	$	—	$	4,226,975
Consumer loans
Home equity
Performing	$	7,120	$	7,314	$	8,925	$	9,332	$	6,946	$	15,485	$	307,985	$	46,238	$	409,345
90 days or more past due	—		—		—		—		—		81		876		554		1,511
Total home equity	7,120		7,314		8,925		9,332		6,946		15,566		308,861		46,792		410,856
Automobile
Performing	447,260		376,473		354,978		210,941		108,085		32,683		—		—		1,530,420
90 days or more past due	25		89		175		230		198		125		—		—		842
Total automobile	447,285		376,562		355,153		211,171		108,283		32,808		—		—		1,531,262
Other Consumer
Performing	5,953		7,101		6,626		6,850		1,037		7,905		903,454		—		938,926
90 days or more past due	—		—		—		—		—		—		—		—		—
Total other consumer	5,953		7,101		6,626		6,850		1,037		7,905		903,454		—		938,926
Total consumer	$	460,358	$	390,977	$	370,704	$	227,353	$	116,266	$	56,279	$	1,212,315	$	46,792	$	2,881,044


	Term Loans
	Amortized Cost Basis by Origination Year
December 31, 2020	2020		2019		2018		2017		2016		Prior to 2016		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term Loans		Total
	(in thousands)
Residential mortgage
Performing	$	730,764	$	778,161	$	684,761	$	582,650	$	380,723	$	943,616	$	64,798	$	—	$	4,165,473
90 days or more past due	—		3,085		4,212		3,464		4,144		3,365		—		—		18,270
Total residential mortgage	$	730,764	$	781,246	$	688,973	$	586,114	$	384,867	$	946,981	$	64,798	$	—	$	4,183,743
Consumer loans
Home equity
Performing	$	8,580	$	10,634	$	11,756	$	8,886	$	5,340	$	15,393	$	318,869	$	50,879	$	430,337
90 days or more past due	—		—		—		—		25		83		378		730		1,216
Total home equity	8,580		10,634		11,756		8,886		5,365		15,476		319,247		51,609		431,553
Automobile
Performing	426,121		438,181		272,075		151,523		50,853		16,550		—		—		1,355,303
90 days or more past due	19		108		173		223		35		94		—		—		652
Total automobile	426,140		438,289		272,248		151,746		50,888		16,644		—		—		1,355,955
Other Consumer
Performing	12,271		5,558		6,815		1,112		1,077		5,314		880,748		—		912,895
90 days or more past due	—		—		—		—		—		22		5		408		435
Total other consumer	12,271		5,558		6,815		1,112		1,077		5,336		880,753		408		913,330
Total consumer	$	446,991	$	454,481	$	290,819	$	161,744	$	57,330	$	37,456	$	1,200,000	$	52,017	$	2,700,838

Troubled debt restructured loans. 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. If the borrower is experiencing financial difficulties and a concession has been made at the time of such modification, the loan is classified as a troubled debt restructured loan (TDR).

Generally the concessions made for TDRs involve lowering the monthly payments on loans through either a reduction in interest rate below a market rate, an extension of the term of the loan without a corresponding adjustment to the risk premium reflected in the interest rate, or a combination of these two methods. The concessions may also involve payment deferrals but rarely result in the forgiveness of principal or accrued interest. In addition, Valley frequently obtains additional collateral or guarantor support when modifying such loans. If the borrower has demonstrated performance under the previous terms of the loan and Valley’s underwriting process shows the borrower has the capacity to continue to perform under the restructured terms, the loan will continue to accrue interest. Non-accruing restructured loans may be returned to accrual status when there has been a sustained period of repayment performance (generally six consecutive months of payments) and both principal and interest are deemed collectible.


	Three Months Ended June 30,
	2021					2020
Troubled Debt Restructurings	Number of Contracts	Pre-Modification Amortized Carrying Amount		Post-Modification Amortized Carrying Amount		Number of Contracts	Pre-Modification Amortized Carrying Amount		Post-Modification Amortized Carrying Amount
	($ in thousands)
Commercial and industrial	9	$	8,592	$	8,529	4	$	9,052	$	7,047
Commercial real estate:
Commercial real estate	6	12,237		12,223		1	885		900
Construction	—	—		—		2	435		218
Total commercial real estate	6	12,237		12,223		3	1,320		1,118
Residential mortgage	2	1,089		1,079		—	—		—

Total	17	$	21,918	$	21,831	7	$	10,372	$	8,165


	Six Months Ended June 30,
	2021					2020
Troubled Debt Restructurings	Number of Contracts	Pre-Modification Amortized Carrying Amount		Post-Modification Amortized Carrying Amount		Number of Contracts	Pre-Modification Amortized Carrying Amount		Post-Modification Amortized Carrying Amount
	($ in thousands)
Commercial and industrial	13	$	20,855	$	19,648	20	$	22,196	$	19,674
Commercial real estate:
Commercial real estate	6	12,237		12,223		2	4,748		4,762
Construction	—	—		—		2	435		218
Total commercial real estate	6	12,237		12,223		4	5,183		4,980
Residential mortgage	8	2,618		2,586		—	—		—
Consumer	1	169		166		—	—		—
Total	28	$	35,879	$	34,623	24	$	27,379	$	24,654

The total TDRs presented in the above table had allocated allowance for loan losses of $4.5 million and $8.4 million at June 30, 2021 and 2020, respectively. There were $697 thousand and $5.8 million of charge-offs related to TDRs for the three and six months ended June 30, 2021, respectively. There were $2.9 million and $3.7 million of charge-offs were related to TDRs for the three and six months ended June 30, 2020, respectively. Valley did not extend any commitments to lend additional funds to borrowers whose loans have been modified as TDRs during the three and six months ended June 30, 2021 and 2020.


	Three Months Ended June 30,
	2021			2020
Troubled Debt Restructurings Subsequently Defaulted	Number of Contracts	Recorded Investment		Number of Contracts	Recorded Investment
	($ in thousands)
Commercial and industrial	—	$	—	20	$	14,986

Residential mortgage	1	445		1	220
Consumer	—	—		2	204
Total	1	$	445	23	$	15,410


	Six Months Ended June 30,
	2021			2020
Troubled Debt Restructurings Subsequently Defaulted	Number of Contracts	Recorded Investment		Number of Contracts	Recorded Investment
	($ in thousands)
Commercial and industrial	15	$	12,384	20	$	14,986

Residential mortgage	2	692		1	220
Consumer	—	—		2	204
Total	17	$	13,076	23	$	15,410

Forbearance. In response to the COVID-19 pandemic and its economic impact to certain customers, Valley implemented short-term loan modifications such as payment deferrals, fee waivers, extensions of repayment terms, or delays in payment, when requested by customers, all of which were insignificant. As of June 30, 2021, Valley had approximately $142 million of outstanding loans remaining in their payment deferral period under short-term modifications as compared to $361 million of loans in deferral at December 31, 2020. Under the applicable guidance, none of these loans were classified as TDRs at June 30, 2021 and December 31, 2020.

Loans in Process of Foreclosure. Other real estate owned (OREO) totaled $4.5 million and $5.1 million at June 30, 2021 and December 31, 2020, respectively. OREO included foreclosed residential real estate properties which were immaterial at June 30, 2021 and totaled $1.0 million at December 31, 2020. Residential mortgage and consumer loans secured by residential real estate properties for which formal foreclosure proceedings are in process totaled $2.0 million and $1.9 million at June 30, 2021 and December 31, 2020, 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 foreclosure is probable, 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.


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
	(in thousands)
Components of provision for credit losses for loans:
Provision for loan losses	$	5,810	$	41,025	$	14,502	$	74,876
Provision for unfunded credit commitments	2,967		90		3,289		163
Total provision for credit losses for loans	$	8,777	$	41,115	$	17,791	$	75,039


	Commercial and Industrial		Commercial Real Estate		Residential Mortgage		Consumer		Total
	(in thousands)
Three Months Ended June 30, 2021
Allowance for loan losses:
Beginning balance	$	126,408	$	174,236	$	27,172	$	15,064	$	342,880
Loans charged-off	(10,893)		—		(1)		(1,480)		(12,374)
Charged-off loans recovered	678		665		191		1,474		3,008
Net (charge-offs) recoveries	(10,215)		665		190		(6)		(9,366)
(Credit) provision for loan losses	(6,504)		14,238		(2,059)		135		5,810
Ending balance	$	109,689	$	189,139	$	25,303	$	15,193	$	339,324
Three Months Ended June 30, 2020
Allowance for losses:
Beginning balance	$	127,437	$	111,585	$	29,456	$	14,864	$	283,342


Loans charged-off	(14,024)		(27)		(5)		(2,601)		(16,657)
Charged-off loans recovered	799		51		545		509		1,904
Net (charge-offs) recoveries	(13,225)		24		540		(2,092)		(14,753)
Provision (credit) for loan losses	17,827		20,093		(366)		3,471		41,025
Ending balance	$	132,039	$	131,702	$	29,630	$	16,243	$	309,614


	Commercial and Industrial		Commercial Real Estate		Residential Mortgage		Consumer		Total
	(in thousands)
Six Months Ended June 30, 2021
Allowance for loan losses:
Beginning balance	$	131,070	$	164,113	$	28,873	$	16,187	$	340,243
Loans charged-off	(18,035)		(382)		(139)		(2,618)		(21,174)
Charged-off loans recovered	2,267		734		348		2,404		5,753
Net (charge-offs) recoveries	(15,768)		352		209		(214)		(15,421)
(Credit) provision for loan losses	(5,613)		24,674		(3,779)		(780)		14,502
Ending balance	$	109,689	$	189,139	$	25,303	$	15,193	$	339,324
Six Months Ended June 30, 2020
Allowance for losses:
Beginning balance	$	104,059	$	45,673	$	5,060	$	6,967	$	161,759
Impact of ASU 2016-13 adoption*	15,169		49,797		20,575		6,990		92,531
Beginning balance, adjusted	119,228		95,470		25,635		13,957		254,290
Loans charged-off	(17,384)		(71)		(341)		(5,166)		(22,962)
Charged-off loans recovered	1,368		144		595		1,303		3,410
Net (charge-offs) recoveries	(16,016)		73		254		(3,863)		(19,552)
Provision for loan losses	28,827		36,159		3,741		6,149		74,876
Ending balance	$	132,039	$	131,702	$	29,630	$	16,243	$	309,614


	Commercial and Industrial		Commercial Real Estate		Residential Mortgage		Consumer		Total
	(in thousands)
June 30, 2021
Allowance for loan losses:
Individually evaluated for credit losses	$	64,275	$	4,788	$	618	$	885	$	70,566
Collectively evaluated for credit losses	45,414		184,351		24,685		14,308		268,758
Total	$	109,689	$	189,139	$	25,303	$	15,193	$	339,324
Loans:
Individually evaluated for credit losses	$	120,559	$	89,464	$	38,660	$	4,488	$	253,171
Collectively evaluated for credit losses	5,963,896		19,175,516		4,188,315		2,876,556		32,204,283
Total	$	6,084,455	$	19,264,980	$	4,226,975	$	2,881,044	$	32,457,454
December 31, 2020
Allowance for loan losses:
Individually evaluated for credit losses	$	73,063	$	1,338	$	1,206	$	264	$	75,871
Collectively evaluated for credit losses	58,007		162,775		27,667		15,923		264,372
Total	$	131,070	$	164,113	$	28,873	$	16,187	$	340,243
Loans:
Individually evaluated for credit losses	$	131,057	$	61,754	$	35,151	$	1,631	$	229,593
Collectively evaluated for credit losses	6,730,651		18,409,069		4,148,592		2,699,207		31,987,519
Total	$	6,861,708	$	18,470,823	$	4,183,743	$	2,700,838	$	32,217,112