Ladies and gentlemen, thank you for standing by and welcome to the Valley National Bancorp Second Quarter Earnings Call. At this time, all lines are in a listen-only mode. Later, there will be an opportunity for your questions and instructions will be given at that time. (Operator Instructions). And as a reminder, this conference is being recorded. I will now turn the conference over to Dianne Grenz for opening remarks. Please go ahead.

Good morning. Welcome to Valley’s second quarter 2014 earnings conference call. If you have not read the second quarter 2014 earnings release that we issued early this morning, you may access it from our website at valleynationalbank.com. Comments made during this call may contain forward-looking statements relating to Valley National Bancorp and the banking industry. Valley encourages participants to refer to our SEC filings including those found on Form 8-K, 10-Q, and 10-K for complete discussion of forward-looking statements. And now, I’d like to turn the call over to Valley’s Chairman, President and CEO, Gerald Lipkin.

Thank you, Dianne. Good morning and welcome to our second quarter earnings conference call. For the quarter, Valley generated net income of $29.5 million, the equivalent of $0.15 per diluted common share. The quarter included an infrequent increase in non-interest expense about which Alan will provide additional information in his prepared remarks. For the year-to-date net income was $63.4 million or $0.32 per diluted common share. Total non-covered loan growth was among the highlights for the quarter, strong origination volume in consumer commercial real estate and C&I lending was offset by the continued slowdown in residential mortgage activity as reported by most of the industry this quarter. During the quarter we originated over $600 million of new loans approximately 30% consumer and 70% commercial. Total commercial lending originations of nearly $425 million for the quarter was relatively inline with the activity generated in the prior quarter. However, unlike the first quarter increase C&I activity dominated the growth. Point in time, C&I balances increased nearly 9% annualized from the prior quarter as record originations of nearly $300 million a new C&I loans were generating. Activity was brisk in all of Valley’s marketplaces. New York in the aggregate accounted for approximately 60% of the new origination volume. Specifically, New York C&I origination closings expanded over 50% from the prior quarter compared to linked quarter growth in New Jersey C&I originations of approximately 25%. In addition, the strong origination volume realized in the quarter C&I line usage increased from 37% to 39% resulting in an increasing outstandings of approximately $30 million. The average yield, our new C&I originations was approximately 4% for the period as interest rates on strong credit continue to be pressured. Commercial real estate outstandings for the quarter increased slightly as originations of approximately $125 million or largely mitigated by…

Thank you, Gerry. Net interest income in the second quarter totaled $117.4 million, an increase of approximately $3.4 million from the first quarter. The growth is largely attributable for loan expansion coupled with increased accretion on purchased, credit impaired loans. We anticipate additional accretion in future periods from the purchased credit impaired loan portfolios as the credit performance has improved resulting in higher cash flows and an increase and expected collections as compared to the previous estimates. Although, we anticipate continued future benefits to net interest income, the blended rate on new loans originated during the quarter of approximately 3.40% will likely pressure the aggregate future portfolio yield. The loan yield on new loans is a function of the interest rate environment increased market competition and a reduction of duration of new assets originated. During the period automobile loans accounted for approximately 25% of Valley’s originations. The yield on this portfolio was approximately 2%, which will though low provides a positive return based on a 28 month to 30 month average duration in conjunction with Valley’s low loan loss experience in this asset class. Partly mitigating the current linked quarter increase in net interest income within the loan portfolio was an acceleration of investment premium amortization of approximately $1 million. Mostly, as a result of the increase in amortization, the yield on the taxable investment portfolio declined 21 basis points from the prior period, as mortgage-backed securities cash flow increased approximately 19% from the prior quarter. Based on initial cash flows received in July, we anticipate a further increase in premium amortization and accordingly further contraction in both portfolio yield and investment interest income. Mainly, as a result of the aforementioned discretion on loans, the yield on earning assets expanded 7 basis points from the prior quarter to 4.35%, and…

Thank you. (Operator Instructions) Our first question will come from Steven Alexopoulos with JP Morgan. Go ahead please. Steven Alexopoulos – JP Morgan: Hi, good morning, guys.

Good morning, Steve. Steven Alexopoulos – JP Morgan: Just to start, regarding the scheduled maturities that you outlined, I know we discussed this partially last quarter. First question, do you expect to replace all of the $1.5 billion of the borrowings maturing, or is there room to just reduce that and shrink the size of the balance sheet a bit?

I don’t think we’ve come up with an absolutely plan, I mean we do have nine months before it even begins and then from that point forward we have another couple of years. So we’ll continue to monitor that based upon deposit growth, asset growth and so forth and see what make sense for us going forward.

I think loan demand also will have big role in determining how much we have to fund. Steven Alexopoulos – JP Morgan: Is there any plan to expand borrowings now at low rates and maybe pre-fund some of the maturities, or are you only using derivatives?

You can’t its not linear the pre-funding it costs you more than let’s just writing it out and since we’re so close to the maturity we are far better of writing it out.

And I think the other point that we made was that we do have some forward starting swaps in place so those have effectively locked in rates today or when they begin maturity. Steven Alexopoulos – JP Morgan: That was the one-third you referenced, right, Alan?

That’s correct. Steven Alexopoulos – JP Morgan: What is the term on that?

Those are – they are three to five year terms. We are looking again at various terms and again it’s cheaper to do what we did, and then to have negative carry by virtue of paying of these early and ending up a reducing capital. Steven Alexopoulos – JPMorgan: Great, okay.

Or by just carrying extra debt on the books, this is just our way of doing that without adding debt for no reason. Steven Alexopoulos – JPMorgan: Right, okay. And separately on the commercial real estate loans, how did the $125 million in originations compare to the prior quarter? Maybe could you discuss scheduled maturities of these loans in the second half?

Yes, it’s down somewhat from the prior quarter, we do have fairly significant pipeline, but again I think as we’ve discussed in prior quarters. We can control when those loans are going to close. So we may have had less closings during the course of the second quarter then the first, but our pipeline remains fairly significant. Steven Alexopoulos – JPMorgan: And just a final one. The yield on those new commercial real estate loans, can you talk about that? Other banks are talking about that being very good.

In the 4% range Steve? Steven Alexopoulos – JPMorgan: The 4% range, okay. All right, thanks for taking my questions.

Great.

Thank you. Our next question will come from Ken Zerbe with Morgan Stanley. Go ahead please. Ken Zerbe – Morgan Stanley: Thanks. Gerry, your comments on the economic activity in your existing footprint, so Jersey in particular, seemed to be a little more optimistic than what I thought I heard as part of the rationale for why you are moving to Florida. What has changed?

Well, we are seeing activity particularly in the New York City marketplace. There we are seeing activity of all types manufacturing, retail, wholesale businesses. We are seeing a little more activity in Northern New Jersey, but still Northern New Jersey is not as robust as we see in New York City and Long Island. Florida I don’t have to tell you just keeps growing. Ken Zerbe – Morgan Stanley: Got it. But I guess I was just thinking, because part of the rationale for going to Florida was just that you didn't have the growth opportunities up here in the Northeast.

We don’t, we would like to be growing a lot faster than we are. Ken Zerbe – Morgan Stanley: Got it, okay. So it is growth, but just not as much as you want. Understood. All right, thank you.

Thank you. We’ll go next to Matthew Kelley with Sterne Agee. Go ahead please. Matthew Kelley – Sterne Agee & Leach, Inc.: Hi, so the $5.3 million increase in interest income in the quarter, that was entirely attributable to PCI, or how much specifically was the PCI benefit in 2Q?

Up $3 million. Matthew Kelley – Sterne Agee & Leach, Inc.: Okay. And what was that in the first quarter?

That would be the incremental increase over where we were in the first quarter I said. Matthew Kelley – Sterne Agee & Leach, Inc.: Okay.

We had just reforecasted, so this is the increase you saw over the previous quarter. Matthew Kelley – Sterne Agee & Leach, Inc.: And what is the absolute dollar amount of that interest income?

It is on the whole portfolio of loans that are PCI loans. So we have close to $700 million of loans. And those loans have all been reforecasted. And at this point, we recorded a portion of that interest in this quarter and there will be additional interest as we go forward, depending on how those loans performed. Matthew Kelley – Sterne Agee & Leach, Inc.: Let me ask you this then, the 327 margin, what would that have been without any of the PCI accretion, to give us a sense of the core margin? And just talk about what you think the core margin will do in the back half of the year.

Yes, I don’t think, yes, it becomes core, but I mean I don’t think we really break it out to that point Matt to tell you exactly would have been et cetera. I think what we’re telling you as it going forward, even though we have this accretion and it is adding to our interest income, you have to look at where real rates are today and what is happening with that, the average of 3% to 4% on loans. Matthew Kelley – Sterne Agee & Leach, Inc.: Okay, got you. And then your reserve coverage on non-covered loans looks like it has kind of troughed out, you know, 85 basis points, 90 basis points. Is that kind of where you want to hold it? As you continue to grow the portfolio, should we expect that level will be maintained?

I think as we’ve said before we continue to run our model and that model right now our delinquencies are down, our non-accruals are down, we have loan growth. But that being said on lot of those portfolios are showing very good low levels of, again, delinquencies and so forth, and we’re comfortable where it is. I don’t know exactly where it is going to drop out. We were talking about at this morning probably the lowest level I think I’ve ever seen was around 80 basis points give or take so we will have to wait and see how that shakes out as we continue to do our modeling and we see our growth. Matthew Kelley – Sterne Agee & Leach, Inc.: Okay.

We always do when we look at loans coming from even different geographies or different types of loans we might be providing more on those loans then we would on loans that are much more similar to what we see in our portfolio. So that will get’s modeled. Matthew Kelley – Sterne Agee & Leach, Inc.: Got you. And then just last question, what should we be using for a tax rate going forward?

I think we said in their 27% to 29% in that range. Matthew Kelley – Sterne Agee & Leach, Inc.: Okay, thank you.

You’re welcome.

Thank you. We have question from David Darst with Guggenheim Securities. Go ahead please. David Darst – Guggenheim Securities: Hi, good morning.

Good morning, David. David Darst – Guggenheim Securities: So within direct growth this quarter, are you expecting that we should see similar volumes going forward, or would it accelerate or decelerate based on maybe you entering Florida before closing on the acquisition?

I think you’re going to see pretty much similar to the current rate for the rest of the year. If we start to accelerate in the fourth quarter as a result of our acquisition it wouldn’t really show up in our numbers. And so after the loans close and that probably wouldn’t happen till January do you follow what I’m saying? David Darst – Guggenheim Securities: Yes.

We closed in October or November. The loans don’t really go on the books usually it takes 30 to 60 days before a loan is approved and it actually closed. David Darst – Guggenheim Securities: Okay. Alan, can you give us a sense of what expected life is or duration of the $700 million in PCI loans is?

It’s probably three to four years. It’s a little hard to give you an exact number, what we are estimating in the three to four year range. David Darst – Guggenheim Securities: Okay. Did that just change with these revaluations?

Well, it usually does change every time you do the reforecasting and as you see loans paying down or whatever they are doing, yes, it does and yes we did see a drop somewhat. David Darst – Guggenheim Securities: Okay, you drop. Okay, great, thank you.

Thank you. (Operator Instructions) We have no other callers in queue Mr. Lipkin. Please go ahead with any closing remarks.

Well, thank you. I appreciate everybody’s time.

Thank you for joining us for the second quarter conference call. And have a great day.