Valley National has crossed the billion dollar mark in auto.
The bank said its auto loan portfolio grew by $64.7 million over the second quarter of 2014 to $1 billion, according to its SEC earnings report filed today. Last year at this same time, the bank had an $835 million auto portfolio.
Valley National wrote that it had not deviated from what it calls “conservative underwriting standards,” and has not participated in the subprime auto lending market as many of its competitors have. Valley did not make any loan purchases from third-party originators during the past two quarters ended June 30, according to its SEC filing.
The bank also said it increased allocations for losses on auto as well as other consumer loans, due to the significant loan growth in those portfolios over the last several quarters, combined with some mixed signals from certain economic indicators during the second quarter of 2014. Nonetheless, the bank remains cautiously optimistic.
Gerald H. Lipkin, chairman, president and CEO, said in a company release that, “Given the continuous challenges of today’s regulatory and low interest rate environments, we are pleased with our second quarter performance. During the second quarter, we were encouraged by the solid uptick in commercial and industrial loan demand which supported a 9% annualized expansion in this loan category, while automobile loan growth continued during the period due to our extensive dealer network and a robust U.S. auto market.”
The filing said potential future loan growth from solid commercial loan and automobile loan demand has continued into the early stages of the third quarter of 2014 and is anticipated to positively impact our future net interest income.
