Stock-Based Compensation

6 Months Ended

Jun. 30, 2023

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

Stock–Based Compensation

On April 25, 2023, Valley's shareholders approved the Valley National Bancorp 2023 Incentive Compensation Plan (the 2023 Plan). The purpose of the 2023 Plan is to provide additional long-term incentives to employees, directors and officers whose contributions are essential to the continued growth and success of Valley. Upon shareholder approval of the 2023 Plan, Valley ceased granting awards under the Valley National Bancorp 2021 Incentive Compensation Plan (the 2021 Plan). Under the 2023 Plan, Valley may issue awards to its officers, employees and non-employee directors in amounts up to 14.5 million shares of common stock, less one share for every share granted after December 31, 2022 under the 2021 Plan.

Restricted stock units are awarded as performance-based RSUs and time-based RSUs. The performance-based RSU awards are granted to certain officers and include RSUs with vesting conditions based upon certain levels of growth in Valley's tangible book value per share, plus dividends; and RSUs, with vesting conditions based upon Valley's total shareholder return as compared to its peer group.

The table below summarizes RSU awards granted and average grant date fair values for the three and six months ended June 30, 2023 and 2022:

	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
	(in thousands, except per share data)
Award shares granted:
Performance-based RSUs	—		52		723		619
Time-based RSUs	178		937		1,731		2,104
Average grant date fair value per share:
Performance-based RSUs	$	—	$	13.60	$	12.80	$	14.72
Time-based RSUs	$	8.35	$	12.85	$	11.55	$	13.51

Stock award fair values are expensed over the shorter of the vesting or required service period. Valley recorded total stock-based compensation expense of $8.7 million and $6.2 million for the three months ended June 30, 2023

and 2022, respectively and $16.8 million and $13.4 million for the six months ended June 30, 2023 and 2022, respectively. As of June 30, 2023, the unrecognized amortization expense for all stock-based employee compensation totaled approximately $49.4 million. This expense will be recognized over an average remaining vesting period of approximately 2.0 years. See Note 12 in Valley’s Annual Report on Form 10-K for the year ended December 31, 2022 for details on the stock-based compensation awards.