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Benefit Plans
 12 Months Ended
Dec. 31, 2023
Retirement Benefits [Abstract]  
Benefit Plans
BENEFIT PLANS (Note 12)
Defined Benefit Pension and Postretirement Benefit Plans
The Bank had offered a qualified non-contributory defined benefit plan and a non-qualified supplemental retirement plan to eligible employees and key executives who met certain age and service requirements, as well as a non-qualified directors' retirement plan. The qualified and non-qualified plans were frozen effective December 31, 2013. Consequently, participants in each plan will not accrue further benefits and their pension benefits were immediately vested and determined based on their compensation and service as of December 31, 2013.
On April 1, 2022, Valley assumed a qualified non-contributory defined benefit pension plan (frozen to both benefits and new participants) covering certain former employees of Bank Leumi USA. Valley also assumed Other post-employment medical and life insurance benefit ("OPEB") plans from Bank Leumi USA mostly covering retired former employees. The OPEB plans are active, but closed to new participants.
Collectively, all qualified and non-qualified plans are referred to as the “Pension” in the tables below unless indicated otherwise.
The following table sets forth the change in the projected benefit obligation, the change in fair value of plan assets and the funded status and amounts recognized in Valley’s consolidated financial statements for the Pension and OPEB plans at December 31, 2023 and 2022, if applicable: 
PensionOPEB
2023202220232022
 (in thousands)
Change in projected benefit obligation:
Projected benefit obligation at beginning of year$175,496 $180,204 $5,981 $— 
Acquisition (1)
— 49,008 — 7,445 
Interest cost8,923 5,373 279 174 
Actuarial gain (loss) 7,604 (48,109)(161)(975)
Benefits paid(12,105)(10,980)(648)(663)
Projected benefit obligation at end of year$179,918 $175,496 $5,451 $5,981 
Change in fair value of plan assets:
Fair value of plan assets at beginning of year$275,406 $278,420 $— $— 
Acquisition— 53,433 — — 
Actual return on plan assets37,993 (47,029)— — 
Employer contributions1,566 1,562 648 663 
Benefits paid(12,105)(10,980)(648)(663)
Fair value of plan assets at end of year (2)
$302,860 $275,406 $— $— 
Funded status of the plan
Assets (liabilities) recognized$122,942 $99,910 $(5,451)$(5,981)
Accumulated benefit obligation179,918 175,496 $5,451 $5,981 
(1)    Beginning balances of the Pension and OPEB plans assumed from Bank Leumi USA are presented as of April 1, 2022, based on the actuarial valuation by the plan administrator.
(2)    Pension assets include accrued interest receivables of $826 thousand and $710 thousand as of December 31, 2023 and 2022, respectively.

Amounts recognized as a component of accumulated other comprehensive loss at end of year that have not been recognized as a component of the net periodic pension expense for Valley’s Pension and OPEB plans are presented in the following table:
PensionOPEB
2023202220232022
 (in thousands)
Net actuarial loss (gain)$45,746 $53,400 $(988)$(881)
Prior service cost216 251 — — 
Deferred (benefit) tax expense(12,697)(15,116)273 249 
Total$33,265 $38,535 $(715)$(632)
The non-qualified plans presented within Pension in the tables above had a projected benefit obligation, accumulated benefit obligation, and fair value of plan assets as follows: 
20232022
 (in thousands)
Projected benefit obligation$14,571 $14,899 
Accumulated benefit obligation14,571 14,899 
Fair value of plan assets— — 
In determining the discount rate assumptions, management looks to current rates on fixed-income corporate debt securities that receive a rating of AA or higher from either Moody’s or S&P with durations equal to the expected benefit
payments streams required of each plan. The weighted average discount rate used in determining the actuarial present value of benefit obligations for the Pension plans was 5.00 percent and 5.31 percent as of December 31, 2023 and 2022, respectively, and 4.97 percent and 5.29 percent for the OPEB plans as of December 31, 2023 and 2022, respectively.
The net periodic benefit (income) cost for the Pension and OPEB plans were reported within other non-interest expense included the following components for the years ended December 31, 2023, 2022 and 2021: 
PensionOPEB
20232022202120232022
 (in thousands)
Interest cost$8,923 $5,373 $3,510 $279 $174 
Expected return on plan assets(22,792)(20,858)(16,364)— — 
Amortization of net loss (gain)58 1,000 1,538 (54)(95)
Amortization of prior service cost135 135 135 — — 
Net periodic benefit (income) cost$(13,676)$(14,350)$(11,181)$225 $79 
Valley estimated the interest cost component of net periodic benefit (income) cost (as shown in the table above) using a spot rate approach for the plans by applying the specific spot rates along the yield curve to the relevant projected cash flows. Valley believes this provides a better estimate of interest costs than a single weighted average discount rate derived from the yield curve used to measure the benefit obligation at the beginning of the applicable period.

Other changes in plan assets and benefit obligations recognized in other comprehensive (income) loss for the years ended December 31, 2023 and 2022 were as follows: 
PensionOPEB
2023202220232022
 (in thousands)
Net actuarial (gain) loss$(7,596)$19,777 $(161)$(976)
Amortization of prior service cost(135)(135)— — 
Amortization of actuarial (loss) gain(58)(1,000)54 95 
Total recognized in other comprehensive loss$(7,789)$18,642 $(107)$(881)
Total recognized in net periodic benefit (income) cost and other comprehensive (income) loss (before tax)$(21,465)$4,292 $118 $(802)
The benefit payments, which reflect expected future service, as appropriate, expected to be paid in future years are presented in the following table: 
YearPensionOPEB
(in thousands)
2024$12,777 $395 
202512,438 366
202613,094 342
202712,849 331
202813,157 328
Thereafter63,988 1,523 
The weighted average assumptions used to determine net periodic benefit (income) cost for the years ended December 31, 2023, 2022 and 2021 were as follows: 
PensionOPEB
20232022202120232022
Discount rate - projected benefit obligation5.31 %2.85 %2.50 %5.29 %2.85 %
Discount rate - service costN/AN/AN/AN/A2.85 %
Discount rate - interest cost5.23 %2.49 %1.88 %5.29 %2.85 %
Expected long-term return on plan assets7.50 %6.79 %6.75 %N/AN/A
Rate of compensation increaseN/AN/AN/AN/AN/A
Assumed healthcare cost trend rate *N/AN/AN/A5.50 %5.75 %
*    The assumed healthcare cost trend rate used to measure the expected cost of benefits covered by the OPEB plans for 2024 is 5.50 percent. The rate to which the healthcare cost trend rate is assumed to decline (ultimate trend rate) along with the year that the ultimate trend rate will be reached is 4.50 percent in 2028.
The expected long-term rate of return on plans' assets is the average rate of return expected to be realized on funds invested or expected to be invested to provide for the benefits included in the benefit obligation. The expected long-term rate of return on plans assets is established at the beginning of the year based upon historical and projected returns for each asset category. The expected rate of return on plan assets assumption is based on the concept that it is a long-term assumption independent of the current economic environment and changes would be made in the expected return only when long-term inflation expectations change, asset allocations change materially or when asset class returns are expected to change for the long-term.
In accordance with Section 402 (c) of Employee Retirement Income Security Act of 1974, as amended, the investment management advisory firm and individual asset managers, if applicable, of both defined benefit pension plans are granted full discretion to buy, sell, invest and reinvest the portions of the portfolio assigned to them consistent with the Bank Pension Committee’s policy and guidelines and under the supervision of an independent non-discretionary investment consulting firm that reports to the Pension Committee and Trustees. The long-term asset allocation targets set for the plans reflect return requirements and risk tolerances specific to each plan. The asset allocation targets for Valley National Bank Pension Plan (Valley Plan) are set to achieve a required-return assumption with an approximate equal weighting of 50 percent fixed income securities and 50 percent equity securities. The Bank Leumi Employee Retirement Income Plan (Bank Leumi Plan) asset allocation targets are set in accordance with a “liability-driven investment” (LDI) approach whereby the mix of assets varies to minimize funded-status volatility while meeting required-return assumption. The Bank Leumi Plan assets will be invested in approximately 55 percent high-quality fixed income and 45 percent in marketable equities.
Although much depends upon market conditions, the absolute investment objective for the equity portion is to earn at least a mid-to-high single digit return, after adjustment by the CPI, over rolling five-year periods. Relative performance should be above the median of a suitable grouping of other equity portfolios and a suitable index over rolling three-year periods. For the fixed income portion of the Valley Plan, the absolute objective is to earn a positive annual real return, after adjustment by the CPI, over rolling five-year periods. For the fixed income portion of the Bank Leumi Plan, the absolute objective is to earn an annual real return that, to the greatest extent possible, offsets the change in value of the plan’s liability. Relative performance should be better than the median performance of bonds when judged against a suitable index of other fixed income portfolios and above suitable market benchmark over rolling three-year periods. Cash equivalents will be invested in money market funds or in other high quality instruments approved by the Trustees of the qualified plan.
At the direction of the Trustees, and with the assistance of an independent non-discretionary investment consulting firm, the Bank’s Pension Committee manages the risk exposure of the qualified plans’ assets; directs the diversification of the plans’ investments into various suitable investment options and supervises plan assets managed by several individual asset managers. The Pension Committee engages an independent non-discretionary investment consulting firm that regularly monitors the performance of the plan assets and the individual asset managers to ensure they are compliant with the policies adopted by the Pension Committee and Trustees. If the risk profile and overall return of assets managed are not in line with the risk objectives or expected return benchmarks for the qualified plan, the investment consulting firm may recommend the termination of an asset manager to the Pension Committee. In general, the assets of the qualified plans are marketable investment securities that are well-diversified in terms of industry, economic sector, market capitalization and asset class.
The following table presents the weighted-average asset allocations by asset category for the defined benefit pension plans that are measured at fair value by level within the fair value hierarchy. See Note 3 for further details regarding the fair value hierarchy. 
   Fair Value Measurements at Reporting Date Using:
 % of Total
Investments		December 31, 2023Quoted Prices
in Active Markets
for Identical
Assets (Level 1)		Significant
Other
Observable Inputs
(Level 2)		Significant
Unobservable
Inputs
(Level 3)
 ($ in thousands)
Assets:
Investments:
Mutual funds30 %$91,000 $91,000 $— $— 
Equity securities20 60,918 60,918 — — 
Corporate bonds19 56,267 — 56,267 — 
U.S. Treasury securities18 54,234 54,234 — — 
Commingled fund8 25,115 — 25,115 — 
U.S. government agency securities4 10,580 — 10,580 — 
Cash and money market funds1 3,920 3,920 — — 
Total investments100 %$302,034 $210,072 $91,962 $— 

   Fair Value Measurements at Reporting Date Using:
 % of Total
Investments		December 31, 2022Quoted Prices
in Active Markets
for Identical
Assets (Level 1)		Significant
Other
Observable Inputs
(Level 2)		Significant
Unobservable
Inputs
(Level 3)
 ($ in thousands)
Assets:
Investments:
Mutual funds30 %$78,712 $78,712 $— $— 
Equity securities20 55,157 55,157 — — 
Corporate bonds17 46,839 — 46,839 — 
U.S. Treasury securities20 57,587 57,587 — — 
Commingled fund9 23,395 — 23,395 — 
U.S. government agency securities3 9,271 — 9,271 — 
Cash and money market funds1 3,735 3,735 — — 
Total investments100 %$274,696 $195,191 $79,505 $— 
The following is a description of the valuation methodologies used for assets measured at fair value:
Equity securities, U.S. Treasury securities and cash and money market funds are valued at fair value in the tables above utilizing Level 1 inputs. Mutual funds are measured at their respective net asset values, which represent fair values of the securities held in the funds based on Level 1 inputs.
Corporate bonds and U.S. government agency securities are reported at fair value utilizing Level 2 inputs. The prices for these investments are derived from market quotations and matrix pricing obtained through an independent pricing service. Such fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the U.S. Treasury yield curve, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the bond’s terms and conditions, among other things.
Commingled funds are valued based on the NAV as reported by the trustee of the funds. The funds' underlying investments, which primarily comprise fixed-income debt securities and open-end mutual funds, are valued using quoted market prices in active markets or unobservable inputs for similar assets. Therefore, commingled funds are classified as Level 2 within the fair value hierarchy. Transactions may occur daily within the fund.
Based upon actuarial estimates, Valley does not expect to make any contributions to the defined benefit pension plans. Funding requirements for subsequent years are uncertain and will significantly depend on whether the plans' actuary changes
any assumptions used to calculate plan funding levels, the actual return on plan assets, changes in the employee groups covered by the plans, and any legislative or regulatory changes affecting plan funding requirements. For tax planning, financial planning, cash flow management or cost reduction purposes, Valley may increase, accelerate, decrease or delay contributions to the plans to the extent permitted by law.
Other Non-Qualified Plans
Valley maintains separate non-qualified plans for former directors and senior management of Merchants Bank of New York acquired in January of 2001. At December 31, 2023 and 2022, the remaining obligations under these plans were $963 thousand and $1.1 million, respectively, of which $246 thousand and $297 thousand, respectively, were funded by Valley. As of December 31, 2023 and 2022, all of the obligations were included in other liabilities and $519 thousand (net of a $198 thousand tax benefit) and $585 thousand (net of a $231 thousand tax benefit), respectively, were recorded in accumulated other comprehensive loss. The $717 thousand pre-tax in accumulated other comprehensive loss will be reclassified to expense on a straight-line basis over the remaining benefit periods of these non-qualified plans.
Valley assumed, in the Oritani acquisition on December 1, 2019, certain obligations under non-qualified retirement plans, including a SERP for the former Chief Executive Officer of Oritani. The SERP is a retirement benefit with a minimum payment period of 20 years upon death, disability, normal retirement, early retirement or separation from service after a change in control. Distributions from the plan began on July 1, 2020. The funded obligation under the SERP totaled $11.6 million and $12.3 million at December 31, 2023 and 2022, respectively. The SERP is secured by investments in money market mutual funds which are held in a trust and classified as equity securities on the consolidated statements of financial condition at both December 31, 2023 and 2022. Valley recorded net benefit income of $1.5 million, $1.8 million and $357 thousand related to the valuation of the SERP for the years ended December 31, 2023, 2022 and 2021, respectively.
Bonus Plan
Valley National Bank and its subsidiaries may award cash incentive and merit bonuses to its officers and employees based upon a percentage of the covered employees’ compensation as determined by the achievement of certain performance objectives. Amounts charged to salary expense for cash incentive awards were $57.4 million, $54.6 million and $29.0 million during 2023, 2022 and 2021, respectively.
Savings and Investment Plan
Valley National Bank maintains a 401(k) plan that covers eligible employees of the Bank and its subsidiaries and allows employees to contribute a percentage of their salary, with the Bank matching a certain percentage of the employee contribution in cash invested in accordance with each participant’s investment elections. The Bank recorded $16.0 million, $14.0 million and $10.7 million in expense for contributions to the plan for the years ended December 31, 2023, 2022 and 2021, respectively.
Deferred Compensation Plan
Valley has a non-qualified, unfunded deferred compensation plan maintained for the purpose of providing deferred compensation for selected employees participating in the 401(k) plan whose contributions are limited as a result of the limitations under Section 401(a)(17) of the Internal Revenue Code. Each participant in the plan is permitted to defer per calendar year, up to five percent of the portion of the participant’s salary and cash bonus above the limit in effect under the Company's 401(k) plan and receive employer matching contributions that become fully vested after two years of participation in the plan. Plan participants also receive an annual interest crediting on their balances held as of December 31 each year. Benefits are generally paid to a participant in a single lump sum following the participant’s separation from service with Valley. Valley recorded plan expenses of $747 thousand, $447 thousand and $415 thousand for the years ended December 31, 2023, 2022 and 2021, respectively. As of December 31, 2023 and 2022, Valley had an unsecured general liability of $3.6 million and $2.5 million, respectively, included in accrued expenses and other liabilities in connection with this plan.
Stock Based Compensation
On April 25, 2023, Valley's shareholders approved the Valley National Bancorp 2023 Incentive Compensation Plan (the 2023 Plan). The purpose of the 2023 Plan is to provide additional long-term incentives to employees, directors and officers whose contributions are essential to the continued growth and success of Valley. Upon shareholder approval of the 2023 Plan, Valley ceased granting awards under the Valley National Bancorp 2021 Incentive Compensation Plan (the 2021 Plan). Under the 2023 Plan, Valley may issue awards to its officers, employees and non-employee directors in amounts up to 14.5 million shares of common stock, less one share for every share granted under the prior 2021 Plan after December 31, 2022. As of December 31, 2023, 12.5 million shares of common stock were available for issuance under the 2023 Plan.
Valley recorded total stock-based compensation expense of $33.1 million, $28.8 million and $20.9 million for the years ended December 31, 2023, 2022 and 2021, respectively. The stock-based compensation expense for 2023, 2022 and 2021 included $2.3 million, $2.3 million and $1.6 million, respectively, related to stock awards granted to retirement eligible employees. Compensation expense for awards to retirement eligible employees is amortized monthly over a one year required service period after the grant date. The fair values of all other stock awards are expensed over the shorter of the vesting or required service period. As of December 31, 2023, the unrecognized amortization expense for all stock-based compensation totaled approximately $31.6 million and will be recognized over an average remaining vesting period of approximately 1.74 years.
RSUs. RSUs are awarded as (1) performance-based RSUs and (2) time-based RSUs. Performance based RSUs vest based on (i) growth in tangible book value per share plus dividends and (ii) total shareholder return as compared to our peer group. The performance based RSUs “cliff” vest after three years based on the cumulative performance of Valley during that time period. Generally, time-based RSUs vest ratably in one-third increments each year over a three-year vesting period. The RSUs earn dividend equivalents (equal to cash dividends paid on Valley's common share) over the applicable performance or service period. Dividend equivalents, per the terms of the agreements, are accumulated and paid to the grantee at the vesting date, or forfeited if the applicable performance or service conditions are not met.
The table below summarizes average grant date fair values of RSUs for the years ended December 31, 2023, 2022, and 2021:
Restricted Stock Units Average Grant Date Fair Values
 202320222021
(in thousands, except per share data)
Average grant date fair value per share:
Performance-based RSUs$12.80 $14.72 $12.36 
Time-based RSUs$11.25 $13.22 $12.01 
The following table sets forth the changes in RSUs outstanding for the years ended December 31, 2023, 2022 and 2021: 
Restricted Stock Units Outstanding
 202320222021
Outstanding at beginning of year5,196,609 3,889,756 3,228,659 
Granted2,944,837 3,426,181 1,999,376 
Vested(2,110,120)(1,833,739)(1,239,797)
Forfeited(336,996)(285,589)(98,482)
Outstanding at end of year5,694,330 5,196,609 3,889,756 
Restricted Stock. A restricted stock award is a grant of shares of Valley common stock subject to certain vesting and other restrictions. Compensation expense is measured based on the grant-date fair value of the shares.
The following table sets forth the changes in restricted stock awards outstanding for the years ended December 31, 2023, 2022 and 2021: 
Restricted Stock Awards Outstanding
 202320222021
Outstanding at beginning of year5,245 213,908 413,701 
Vested(5,245)(208,663)(191,104)
Forfeited— — (8,689)
Outstanding at end of year— 5,245 213,908 
Stock Options. The fair value of each option granted on the date of grant is estimated using a binomial option pricing model. The fair values are estimated using assumptions for dividend yield based on the annual dividend rate; the stock volatility, based on Valley’s historical and implied stock price volatility; the risk-free interest rates, based on the U.S. Treasury constant maturity bonds, in effect on the actual grant dates, with a remaining term approximating the expected term of the options; and expected exercise term calculated based on Valley’s historical exercise experience.
On April 1, 2022, Valley issued replacement options for the pre-existing and fully vested stock option awards of Bank Leumi USA for 2.7 million shares of Valley common stock at a weighted average exercise price of $8.47. The stock plan under which the original Bank Leumi stock awards were issued is no longer active at the acquisition date.
The following table summarizes stock option activity as of December 31, 2023, 2022 and 2021 and changes during the years ended on those dates: 
 202320222021
Weighted
Average
Exercise		Weighted
Average
Exercise		Weighted
Average
Exercise
Stock OptionsSharesPriceSharesPriceSharesPrice
Outstanding at beginning of year2,927,031 $8 217,555 $7 2,986,347 $7 
Acquired in business combinations— — 2,726,113 8 — — 
Exercised(12,202)6 (16,637)6 (2,768,792)7 
Forfeited or expired— — — — — — 
Outstanding at end of year2,914,829 8 2,927,031 8 217,555 7 
Exercisable at year-end2,914,829 8 2,927,031 8 217,555 7 
The following table summarizes information about stock options outstanding and exercisable at December 31, 2023: 
Options Outstanding and Exercisable
Range of Exercise PricesNumber of OptionsWeighted Average
Remaining Contractual
Life in Years		Weighted Average
Exercise Price
$4-6
42,352 2.2$6 
6-8
88,764 3.27 
8-10
2,758,113 1.88 
10-12
25,600 4.710 
2,914,829 2.08