Valley National Bancorp of Wayne, N.J., said late Wednesday that the fair market value of its Fannie Mae and Freddie Mac preferred stock declined by $40 million from June 30 to Sept. 2.

If it were recognized, the drop would result in a third-quarter after-tax impairment charge of $25.7 million, or about 19 cents a share, Valley National said. The $13 billion-asset company said these securities had a cost basis of about $79 million in the second quarter. Wednesday's announcement followed the sale of a portion of the securities, and the readjusted cost basis is about $70 million, the company said. Valley National said it remains well capitalized.

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