Valley National gets OK to repay government $100M

AP News
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Posted: Dec 22, 2009 11:42 AM

Valley National Bancorp said Tuesday that it received approval from the Treasury Department to repay about $100 million in federal bailout money.

Valley National is the holding company for Valley National Bank, which operates 199 branches in 135 communities.

The company said it expects to redeem on Wednesday the final 100,000 shares of its series A preferred stock held by the Treasury Department under the Capital Purchase Program. Valley will pay $100.7 million for the shares.

In a release, Valley CEO Gerald H. Lipkin said the company's capital position after the repayment will continue to provide management flexibility after the repayment. He noted that Valley raised $135 million through two stock offerings in the past year.

In connection with the issuance of the preferred stock, Valley issued a warrant to the Treasury to buy about 2.4 million shares at $18.66. Valley said it will determine within 15 days whether to exercise its option to repurchase the warrant at fair market value.

Shares of Valley National rose 11 cents to $13.89 in early afternoon trading.