Key Highlights

● Valley National climbed to about $13.71 after adjusted earnings of $0.36 beat estimates of $0.33.

● Cathay General rose to about $64.18, near its 52-week high, on record net interest income.

● S&T Bancorp climbed to around $51 after record third-quarter diluted earnings of $1.09 a share.

● Financials rose as the 10-year yield fell below a closely watched threshold.

Regional bank earnings on Thursday offered something for both optimists and skeptics.

Several lenders posted strong numbers and saw their shares climb, while others missed forecasts after the bell. The mixed picture came on Thursday, October 22, a day when financials rose as investors rotated out of technology and Treasury yields fell sharply.

The winners

Valley National Bancorp (NASDAQ:VLY) climbed to about $13.71 in the afternoon after beating expectations. Adjusted earnings came to $0.36 a share against estimates of $0.33, and revenue of $584.15 million topped forecasts of $577.83 million. Net income was $206.3 million.

The bank's efficiency ratio was its best since the third quarter of 2021, and customer deposits rose $1.1 billion to $55.2 billion. Net charge-offs, however, rose to $37.1 million from $22.0 million. Valley's pending Providence Financial and Bluevine deals are expected to close in early 2027.

Cathay General Bancorp (NASDAQ:CATY) rose to about $64.18, near its 52-week high. Revenue of $254.65 million easily beat consensus of $227.39 million. The core driver was record net interest income of $211.9 million. Earnings of $1.43 a share were two cents below estimates. Its net interest margin widened, and the bank raised its full-year loan and deposit growth guidance.

S&T Bancorp (NASDAQ:STBA) climbed to around $51 after posting record third-quarter diluted earnings of $1.09 a share, ahead of $0.99 expected. Revenue was $107.79 million against $106.72 million forecast. Chief executive Chris McComish described "another one of record earnings per share, record revenue, and higher core profitability."

The laggards

Third Coast Bancshares (NASDAQ:TCBX) slipped to about $40.38 despite beating estimates, with adjusted earnings of $1.06 a share against $1.00. Its net interest margin narrowed. The bank's merger with Great Plains Bancshares is expected to close between February and April 2027.

After the close, the picture turned more mixed. Glacier Bancorp (NASDAQ:GBCI) missed on sales, Hilltop Holdings (NYSE:HTH) missed on revenue, and WSFS (NASDAQ:WSFS), Eastern Bankshares (NASDAQ:EBC) and Ameris Bancorp (NASDAQ:ABCB) also missed. Byline Bancorp (NYSE:BY), 1st Source (NASDAQ:SRCE), Enova (NYSE:ENVA) and Columbia Banking (NASDAQ:COLB) beat expectations, while First Interstate (NASDAQ:FIBK) and United Bankshares (NASDAQ:UBSI) reported results in line.

Student lender Sallie Mae (NASDAQ:SLM) fell in after-hours trading after third-quarter revenue of $375.5 million missed the $457.8 million forecast. It reported a GAAP loss of $0.19 a share against an expected profit of $0.20.

Huntington Bancshares (NASDAQ:HBAN) also reported before the open.

Rates and rotation

Falling Treasury yields set the backdrop. The 10-year yield closed back below a closely watched threshold for the first time since September 22, as investors sought safety from the AI selloff.

Financials rose on the day. Blackstone (NYSE:BX) surged after its results, lifting private equity peers, and CME Group (NASDAQ:CME) rose after a bank's double upgrade. Exchange operator Nasdaq Inc. (NASDAQ:NDAQ) also rallied after beating estimates, with revenue rising to $1.48 billion.

The broader market was split. The Nasdaq Composite tumbled 694 points to 26,008.86 on AI worries, while the Dow Jones Industrial Average edged up 11.89 points to 52,867.98. About two of every three S&P 500 stocks rose, according to market data.

Margins and Credit in Focus for Lenders

More regional bank results are due in the coming days, with investors focused on net interest margins, deposit growth and credit quality, including charge-off trends like those at Valley. The Federal Reserve's decision on October 28 will be key, since interest rates drive bank lending margins.