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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2024

Income tax expense for the years ended December 31, 2024, 2023 and 2022 consisted of the following:


	2024		2023		2022
	(in thousands)
Current expense:
Federal	$	26,308	$	123,569	$	132,060
State	38,079		65,611		72,271
	64,387		189,180		204,331
Deferred (benefit) expense:
Federal	(6,966)		(8,035)		7,263
State	827		(1,324)		222
	(6,139)		(9,359)		7,485
Total income tax expense	$	58,248	$	179,821	$	211,816

Summary of Deferred Tax Assets and Liabilities

The tax effects of temporary differences that gave rise to the significant portions of the deferred tax assets and liabilities as of December 31, 2024 and 2023 were as follows:


	2024		2023
	(in thousands)
Deferred tax assets:
Allowance for credit losses	$	157,629	$	128,717


Employee benefits	41,808		41,190
Investment securities	48,652		42,361
Net operating loss carryforwards	9,078		11,037
Purchase accounting	42,637		53,980


FDIC special assessment	10,673		13,894
Other	23,744		24,362
Total deferred tax assets	334,221		315,541
Deferred tax liabilities:
Pension plans	52,783		37,194
Depreciation	12,314		20,963

Other investments	17,088		11,175

Core deposit intangibles	21,287		28,237
Other	25,876		22,319
Total deferred tax liabilities	129,348		119,888
Valuation allowance	1,263		424
Net deferred tax asset (included in other assets)	$	203,610	$	195,229

Summary of Income Tax Reconciliation

Reconciliation between the reported income tax expense and the amount computed by multiplying consolidated income before taxes by the statutory federal income tax rate of 21 percent for the years ended December 31, 2024, 2023, and 2022 were as follows:


	2024				2023				2022
	Amount		Percent		Amount		Percent		Amount		Percent
	(in thousands)
U.S. federal statutory tax rate	$	92,089	21.0	%	$	142,450	21.0	%	$	163,940	21.0	%
Increase (decrease) due to:
State income tax expense, net of federal tax effect *	30,736		7.0	%	50,787		7.5	%	57,276		7.3	%
Tax credits	(32,104)		(7.3)	%	(23,008)		(3.4)	%	(12,872)		(1.6)	%
Nontaxable or non-deductible items
Disallowed FDIC Insurance Premiums	11,071		2.5	%	7,950		1.2	%	4,796		0.6	%
Other nontaxable or non-deductible	(1,075)		(0.2)	%	(1,291)		(0.2)	%	156		—	%
Changes in unrecognized tax benefits	(46,431)		(10.6)	%	—		—	%	—		—	%
Other adjustments	3,962		0.9	%	2,933		0.4	%	(1,480)		(0.2)	%
Income tax expense	$	58,248	13.3	%	$	179,821	26.5	%	$	211,816	27.1	%

*State taxes in New York, New York City, and New Jersey made up the majority (greater than 50 percent) of the tax effect in this category.

Summary of Reconciliation of Gross Unrecognized Tax Benefits

A reconciliation of Valley’s gross unrecognized tax benefits for the years ended December 31, 2024, 2023 and 2022 is presented in the table below:


	2024		2023		2022
	(in thousands)
Beginning balance	$	30,359	$	30,359	$	30,359


Reductions due to expiration of statute of limitations	(30,359)		—		—
Ending balance	$	—	$	30,359	$	30,359

Summary of Components of Taxes Paid

The following table presents income taxes paid for the years ended December 31, 2024, 2023 and 2022:


	2024		2023		2022
	(in thousands)
Federal taxes paid	$	54,227	$	162,502	$	121,000
State and city taxes paid:
New York	12,447		25,718		18,626
New Jersey	7,475		19,006		12,010
New York City	8,407		13,307		12,141
Other	7,145		15,970		8,325
Total state and city taxes paid	35,474		74,001		51,102
Total income taxes paid	$	89,701	$	236,503	$	172,102