Brian Mozenski's questions to Valley National Bancorp (VLY) leadership • Q4 2024
Question
Brian Mozenski, on behalf of Manan Gosalia, inquired about the impact of the evolving yield curve shape on Valley's Net Interest Income (NII) outlook and sought clarification on the updated reserve ratio target for year-end.
Answer
An executive, Travis Lan, explained that the NII outlook was revised upward due to three key factors: a more beneficial yield curve shape, a stronger year-end funding position from significant direct deposit growth, and greater success in reducing customer deposit costs following Fed rate cuts. Regarding reserves, Lan stated the new 1.20% to 1.25% range reflects a slowdown in criticized asset migration and the anticipated balance sheet shift from CRE to C&I loans.