Valley National in Wayne, N.J., reported an increase in second-quarter earnings on expanded commercial real estate and business lending.
The $19.3 billion-asset company's net income rose 8.4% from the same period a year ago, to $32 million. Earnings per share of 14 cents missed the average estimate of analysts polled by Bloomberg by a penny.
Valley also announced Thursday that it will close 13 branches, including 12 in New Jersey and one in New York City, both owned and leased locations. The closings will save an estimated $4.3 million; Valley expects all 13 branches to be closed by the end of the year. Noncash impairment charges and other associated costs will be immaterial.
Net interest income rose 16% to $136.2 million. Total loans rose 23% to $14.5 billion. Commercial real estate loans rose 31% to $6.7 billion. Business loans rose 15% to $2.4 billion. The net interest margin compressed 4 basis points to 3.18%.
Fee income rose 61% to $20.2 million, on a positive change to Valley's Federal Deposit Insurance Corp. loss-share receivable.
Noninterest expense increased 14% to $107.4 million on higher salaries, employee benefits, occupancy and equipment costs. The efficiency ratio improved 389 basis points to 68.69%.