Moody's cuts Valley National

Moody's Investors Service said it lowered the long-term bank deposit rating of Valley National Bank to A2 from A1 and subordinated debt rating to A3 from A2.

The bank's short-term rating was affirmed at prime-1.

The outlook is stable.

The downgrade reflects a view that Valley National's franchise strength was not consistent with its very high rating despite the fact that the firm performed well through the financial crisis, Moody's said.

Senior management succession also is an issue that led to the downgrade, the agency said.

Though currently strong, Moody's said it believes the business will be challenged due to the transition of control within its customer base to a younger generation and the risk that it will be difficult for the company to maintain its underwriting and pricing discipline as it expands geographically.

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