Valley National Bank’s second quarter was marked by robust commercial loan growth and significant core deposit expansion, which management cited as central to its ongoing strategy. Despite a year-on-year rise in revenue and stable non-GAAP profitability, the market reacted negatively, reflecting concerns around funding costs and the durability of recent growth. CEO Ira Robbins emphasized the bank’s focus on relationship-driven commercial lending and fee income diversification, highlighting progress in capital markets and tax credit advisory. The quarter’s mixed sentiment stemmed from both operational gains and industry-wide pressures on deposit competition and credit quality.

Is now the time to buy VLY? Find out in our full research report (it’s free for active Edge members).

While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Valley National Bank’s Q2 Earnings Call

• Feddie Strickland (J.P. Morgan) asked about the sustainability of fee income and whether recent capital markets results were repeatable. CFO Travis Lan clarified that while some swap income was elevated, core fee lines like treasury services and loan syndications should see continued growth.

• Christopher McGratty (KBW) questioned the balance between loan growth and funding pressures. Lan responded that core deposit growth has kept pace with loan expansion, with management confident that maturing brokered deposits will be replaced by lower-cost core funding.

• David Smith (Morgan Stanley) pressed on the timing mismatch between loan and deposit growth. Lan explained that deposits typically lag loan originations by three to six months, but expects the gap to close over subsequent quarters as new commercial relationships mature.

• Matthew Breese (Raymond James) inquired about long-term net interest margin prospects and the impact of fixed asset repricing. Lan projected continued margin expansion through 2027, citing low-yielding fixed rate loans maturing and structural funding advantages.

• Sun Young Lee (Deutsche Bank) asked about expense trends and AI’s impact on the efficiency ratio. Lan indicated that professional fees should decline as transformation projects wind down, while ongoing AI investments are expected to support further efficiency improvements.

Catalysts in Upcoming Quarters

Looking ahead, the StockStory team will be monitoring (1) the pace and sustainability of core deposit growth to replace brokered funding, (2) the bank’s ability to deliver further improvements in the efficiency ratio as technology initiatives transition from investment to savings, and (3) ongoing trends in commercial loan quality and diversification. Progress on fee income growth and AI-driven operational improvements will also be important indicators of execution.

Valley National Bank currently trades at $14.29, down from $14.52 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free).

The Best Stocks for High-Quality Investors

ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.

Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE.

Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.