(Updates throughout with details, background.)

DOW JONES NEWSWIRES

Valley National Bancorp (VLY) assumed the deposits of Park Avenue Bank, the second failed Manhattan bank that the New Jersey company has taken over in as many days, and the 28th U.S. bank failure this year.

Under the agreement with the FDIC, Valley assumed about $450 million in deposits and $30 million in other borrowings and liabilities, and received about $370 million of loans that are subject to a loss-share agreement with the Federal Deposit Insurance Corp. and cash investment securities and other assets totaling roughly $110 million. The acquired loans consist mainly of commercial loans and loans backed by commercial real estate. Valley paid a 0.15% deposit premium on the assumed deposits.

"As I mentioned regarding our previous FDIC transaction, the loss-sharing agreement entered into with the FDIC for this transaction mitigates significant credit risk that could be assumed in a more traditional bank acquisition," said Valley National Bank President and Chief Executive Gerald H. Lipkin, adding that the two deals are expected to add immediately to earnings.

Park Avenue Bank's five locations will reopen on their next business day and operate as branches of Valley National Bank. The acquisition is effective immediately.

On Thursday, Valley agreed to take over LibertyPointe Bank, the first New York City bank to go down since the start of the financial crisis. Based in lower Manhattan, LibertyPointe had three branches, $209.5 million in deposits and $209.7 million in assets.

Valley was up 0.3% to $14.80 in recent after-hours trading. The stock is up by nearly half over the past year.

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