VALLEY NATIONAL BANCORP, DEF 14A, 1999-03-04

VALLEY NATIONAL BANCORP
DEF 14A, 1999-03-04
NATIONAL COMMERCIAL BANKS

Previous: VALLEY NATIONAL BANCORP, 10-K, 1999-03-04

Next: UNITED NEW CONCEPTS FUND INC, 497, 1999-03-04

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A
(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]

Check the appropriate box:

[_] Preliminary Proxy Statement [_] Confidential, For Use of the
Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12

Valley National Bancorp
(Name of Registrant as Specified In Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.

(1) Title of each class of securities to which transaction applies:

- --------------------------------------------------------------------------------

(2) Aggregate number of securities to which transaction applies:

- --------------------------------------------------------------------------------

(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
- --------------------------------------------------------------------------------

(4) Proposed maximum aggregate value of transaction:

- --------------------------------------------------------------------------------

(5) Total fee paid:

- --------------------------------------------------------------------------------

[_] Fee paid previously with preliminary materials:

- --------------------------------------------------------------------------------

[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.

(1) Amount previously paid:

- --------------------------------------------------------------------------------

(2) Form, Schedule or Registration Statement No.:

- --------------------------------------------------------------------------------

(3) Filing Party:

- --------------------------------------------------------------------------------

(4) Date Filed:

- --------------------------------------------------------------------------------

<PAGE>

VALLEY NATIONAL BANCORP
1455 Valley Road
Wayne, New Jersey 07474

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

To Be Held Wednesday, April 7, 1999

Notice is hereby given that the Annual Meeting of Shareholders of Valley
National Bancorp (the "Corporation") will be held at the Radisson Hotel, 690
Route 46 East, Fairfield, New Jersey, on Wednesday, April 7, 1999 at 3:00 p.m.
for the purpose of considering and voting upon the following matters:

1. The election of the 19 persons named in the accompanying Proxy Statement
to serve as directors of the Corporation for the ensuing year.

2. Approval of the Valley National Bancorp 1999 Long-Term Stock Incentive
Plan, which generally provides the Board of Directors or a Committee comprised
of two or more non-employee directors of the Corporation with authority to issue
or grant to officers and key employees of the Corporation incentive stock
options, non-qualified stock options, restricted stock, and/or stock
appreciation rights for up to a maximum of 2,500,000 shares, with a maximum of
250,000 shares or options to be issued to any one officer or employee.

3. Such other business as shall properly come before the Annual Meeting.

Shareholders of record at the close of business on February 12, 1999 are
entitled to notice of and to vote at the meeting. Whether or not you contemplate
attending the Annual Meeting, it is suggested that the enclosed proxy be
executed and returned to the Corporation. You may revoke your proxy at any time
prior to the exercise of the proxy by delivering to the Corporation a later
dated proxy or by delivering a written notice of revocation to the Corporation
prior to or at the Annual Meeting.

By Order of the Board of Directors

Gerald H. Lipkin
Chairman, President and
Chief Executive Officer

March 1, 1999

<PAGE>

VALLEY NATIONAL BANCORP
1455 Valley Road
Wayne, New Jersey 07474

PROXY STATEMENT
Dated March 1, 1999

GENERAL PROXY STATEMENT INFORMATION

This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Valley National Bancorp (the "Corporation") of proxies
for use at the Annual Meeting of Shareholders of the Corporation to be held at
the Radisson Hotel, 690 Route 46 East, Fairfield, New Jersey, on Wednesday,
April 7, 1999 at 3:00 p.m. local time. This Proxy Statement is first being
mailed to shareholders on approximately March 1, 1999.

Outstanding Securities and Voting Rights

The record date for determining shareholders entitled to notice of and to
vote at the Annual Meeting is February 12, 1999. Only shareholders of record as
of that date will be entitled to notice of, and to vote at, the Annual Meeting.

On the record date 55,291,213 shares of common stock, no par value, were
outstanding and are eligible to be voted at the Annual Meeting. Each share of
stock is entitled to one vote.

All shares represented by valid proxies received pursuant to this
solicitation will be voted in favor of the election of the 19 nominees for
director who are named in this Proxy Statement and in favor of the 1999
Long-Term Stock Incentive Plan unless the shareholder specifies a different
choice by means of his proxy or revokes the proxy prior to the time it is
exercised. Should any other matters properly come before the Annual Meeting, the
persons named as proxies will vote upon such matters in their discretion unless
the shareholder otherwise specifies in the proxy.

At the meeting, inspectors of election will tabulate both ballots cast by
shareholders present and voting in person, and votes cast by proxy. Under
applicable state law and the Corporation's certificate of incorporation and
bylaws, abstentions and broker non-votes are counted for purposes of
establishing a quorum but otherwise do not count. Generally, the approval of a
specified percentage of shares voted at a shareholder meeting is required to
approve a proposal and thus abstentions and broker non-votes have no effect on
the outcome of a vote. At the Annual Meeting, a plurality of the shares voted is
required to elect a director and a majority of votes cast to approve the
proposed 1999 Long-Term Stock Incentive Plan. Where state law or the
Corporation's certificate of incorporation or bylaws require that the matter
voted upon be approved by a specified percentage of the outstanding shares, then
abstentions and broker non-votes have the same effect as negative votes.

Revocability of Proxies

Any shareholder submitting a proxy has the right to attend and vote at the
Annual Meeting in person. A proxy may be revoked prior to the Annual Meeting by
delivery to the Corporation prior to the Annual Meeting of a later dated proxy
or by delivery of a written revocation to Alan D. Eskow, Secretary of the
Corporation, at the administrative headquarters of the Corporation, 1455 Valley
Road, Wayne, New Jersey 07474, if it is received prior to the Annual Meeting. A
proxy may be revoked at the Annual Meeting by filing a later-dated proxy or a
written notice of such revocation with the Secretary of the Annual Meeting prior
to the voting of such proxy.

<PAGE>

Solicitation of Proxies

This proxy solicitation is being made by the Board of Directors of the
Corporation and the cost of the solicitation will be borne by the Corporation.
In addition to the use of the mails, proxies may be solicited personally or by
telephone or facsimile transmission by officers, directors and employees of the
Corporation who will not be specially compensated for such solicitation
activities. Arrangements may be made with brokerage houses and other custodians,
nominees and fiduciaries for forwarding solicitation materials to the beneficial
owners of shares held of record by such persons and the Corporation will
reimburse such persons for their reasonable expenses incurred in that
connection.

PROPOSAL 1 -- ELECTION OF DIRECTORS

DIRECTOR INFORMATION

The Corporation's by-laws authorize a minimum of 5 and a maximum of 25
directors, but leave the exact number to be fixed by the Board of Directors. The
Board has fixed the number of directors at 19.

It is intended that the proxies solicited by the Board of Directors will be
voted for the election of the 19 persons named below (unless the shareholder
otherwise directs). If, for any reason, any nominee becomes unavailable for
election, the proxies solicited by the Board of Directors will be voted for such
substitute nominees as are selected by the Board of Directors unless the Board
has reduced its membership prior to the Annual Meeting. The Board has no reason
to believe that any of the named nominees is not available or will not serve if
elected.

Each candidate for director has been nominated to serve a one-year term
until the year 2000 Annual Meeting of the Corporation and thereafter until his
successor shall have been duly elected and shall have qualified. The following
table sets forth the names and ages of the Board's nominees for election, the
nominees' position with the Corporation (if any), the principal occupation or
employment of each nominee for the past five years and the period during which
each nominee has served as a director of the Corporation. The nominee's prior
service as a director includes prior service as a director of Valley National
Bank (the "Bank") prior to the formation of the holding company.

<TABLE>
<CAPTION>
Name, Age and Position With Principal Occupations During Director
the Corporation Past Five Years Since
-------------------- ---------------- -------
<S> <C> <C>
Andrew B. Abramson, 45.................... President and Chief Executive Officer, The Value 1994
Group, Inc. (real estate development and property
management firm)

Pamela Bronander, 42...................... Executive Vice President, Scandia Packaging Machinery 1993
Co. (designs & builds packaging machinery)

Joseph Coccia, Jr., 69.................... President of Cocci Development (builder and 1986
investor); former principal of Coccia Realty, Inc.
(real estate brokers)

Harold P. Cook, III, 44 .................. Partner in the law firm of Cook & Rumana (formerly 1998
Cook & DeLuccia). Former Chairman and Chief
Executive Officer of Wayne Bancorp, Inc. and Chairman
of Wayne Savings Bank, F.S.B.

Austin C. Drukker, 65..................... President, Press Publications, Inc. (newspaper); 1973
adjunct professor, Montclair State College; President
Albert Payson Terhune Foundation, formerly
President-Publisher, The Herald-News (newspaper)

Willard L. Hedden, 71..................... Retired, formerly Executive Vice President, Spartan 1995
Oil Co. (fuel oil company)
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
Name, Age and Position With Principal Occupations During Director
the Corporation Past Five Years Since
-------------------- ---------------- -------
<S> <C> <C>
Graham O. Jones, 54....................... Attorney, Jones & Jones; Retired, formerly President 1997
of Hoke, Inc., its affiliates and subsidiaries
(manufacturer of precision fluid control products)

Walter H. Jones, III, 56.................. Retired, formerly Chairman of the Board of Hoke, 1997
Inc., its affiliates and subsidiaries (manufacturer
of precision fluid control products)

Gerald Korde, 55.......................... President, Birch Lumber Company, Inc. (wholesale and 1989
retail lumber distribution company)

Gerald H. Lipkin, 58...................... Chairman and Chief Executive Officer of the 1986
Chairman, President and Chief Executive Corporation and the Bank
Officer
Joleen Martin, 66......................... President , C.P. Test Services, Inc. (valve and curb 1995
box manufacturing company)

Robert E. McEntee, 66..................... Management Consultant; formerly, President, Russ 1979
Berrie and Company, Inc. (marketer of gift items)

Sam P. Pinyuh, 66......................... Retired, formerly Executive Vice President of the 1990
Corporation and the Bank

Robert Rachesky, 70....................... Consultant, Fujicolor Photo Services, Inc. (photo 1982
developing and supply company)

Barnett Rukin, 58......................... Chairman and Chief Executive Officer, Hudson Transit 1991
Lines, Inc. (operator of Short Line Bus Company)

Peter Southway, 64........................ Vice Chairman of the Corporation and the Bank; 1978
Vice Chairman formerly President and Chief Operating Officer of the
Corporation and the Bank

Richard F. Tice, 69....................... Partner, Tice Farms (farming and real estate) 1982

Leonard Vorcheimer, 56.................... Principal, L.J.V. Enterprises (investment concern) 1992

Joseph L. Vozza, 69....................... President, Joseph L. Vozza Administrative Services, 1982
Inc. (insurance consultant/administrator); formerly
President, Joseph L. Vozza Agency, Inc. (insurance
broker); and former President, Public Entity Risk
Management Administration Corp. (administrator of
self insurance pools for public entities)
</TABLE>

Peter Southway is the father of Peter John Southway. Both are executive
officers of the Corporation and the Bank.

<PAGE>

Committees of the Board of Directors

The Board of Directors of the Corporation held 13 meetings during 1998. All
the directors of the Corporation also serve as directors of the Bank.

The Corporation has a standing Audit and Examining Committee. The Audit and
Examining Committee reviews significant audit and accounting principles,
policies and practices, meets with the internal auditors of the Bank, reviews
the report of the annual examination of the Corporation conducted by the outside
auditors, and reviews examination reports and other reports of federal
regulatory agencies. The Audit and Examining Committee consists of the following
directors: Messrs. Rachesky (Chairman), Drukker, Korde, McEntee, Tice,
Vorcheimer, and Ms. Bronander. The Committee met five times during 1998.

The Corporation has a standing Personnel and Compensation Committee. The
Personnel and Compensation Committee (the "Committee") sets general compensation
levels for all officers and employees and sets specific compensation for
executive officers. The Committee also administers the Long-Term Incentive Plan
and makes awards thereunder. The Committee, which met six times in 1998,
consists of Messrs. McEntee (Chairman), Abramson, Drukker, G. Jones, Korde,
Rachesky and Tice.

The Corporation has a standing Nominating and Governance Committee. The
Nominating and Governance Committee is responsible for nominating directors to
serve on the board of directors of the Corporation and the Bank. The Nominating
and Governance Committee consists of Messrs. Drukker (Chairman), Abramson,
Coccia, Korde, Lipkin, McEntee, Rachesky and Vozza. The Nominating and
Governance Committee met one time during 1998. The Nominating and Governance
Committee has not established specific procedures for receiving recommendations
from shareholders for nominees for election to the Board of Directors, but will
consider such recommendations brought to the attention of the committee.

During 1998 each director attended at least 75% or more of the meetings of
the Board of Directors of the Corporation and of each committee of the Board on
which he or she served.

STOCK OWNERSHIP OF MANAGEMENT
AND PRINCIPAL SHAREHOLDERS

The following table sets forth information concerning the beneficial
ownership of the Corporation's common stock, no par value, as of December 31,
1998, by each director, by each executive officer of the Corporation for whom
individual information is required to be set forth in this Proxy Statement (the
"Named Officers") under rules of the Securities and Exchange Commission (the
"SEC"), and by directors and all executive officers as a group. The Corporation
knows of no person or group which beneficially owns 5% or more of the
Corporation's common stock.

<PAGE>

<TABLE>
<CAPTION>
Number of Shares Percent of
Name of Beneficial Owner Beneficially Owned(1) Class(2)
------------------------ ---------------------- ----------
<S> <C> <C>
Directors and Named Officers:
Willard L. Hedden.................................................... 51,607(9) 0.09
Graham O. Jones...................................................... 679,837 1.21
Walter H. Jones, III................................................. 679,837 1.21
Gerald Korde......................................................... 933,354(10) 1.66
Gerald H. Lipkin..................................................... 298,813(11) 0.53
Joleen Martin........................................................ 114,241(12) 0.20
Robert E. McEntee.................................................... 51,612(13) 0.09
Robert Meyer......................................................... 210,395(14) 0.38
Sam P. Pinyuh........................................................ 73,231(15) 0.13
Robert Rachesky...................................................... 236,218(16) 0.42
Barnett Rukin........................................................ 23,530(17) 0.04
Peter Southway....................................................... 225,939(18) 0.40
Peter John Southway.................................................. 60,257(19) 0.11
Richard F. Tice...................................................... 170,139(20) 0.30
Leonard Vorcheimer................................................... 36,393(21) 0.06
Joseph L. Vozza...................................................... 39,911(22) 0.07
Directors and Executive Officers as a group (31 persons)............. 4,618,071(23) 8.23
</TABLE>

- ----------
NOTES:

(1) Beneficially owned shares include shares over which the named person
exercises either sole or shared voting power or sole or shared investment
power. It also includes shares owned (i) by a spouse, minor children or by
relatives sharing the same home, (ii) by entities owned or controlled by
the named person and (iii) by other persons if the named person has the
right to acquire such shares within 60 days by the exercise of any right or
option. Unless otherwise noted, all shares are owned of record and
beneficially by the named person.

(2) The number of shares of common stock used in calculating the percentage of
the class owned includes 55,266,325 shares of common stock outstanding as
of December 31, 1998, and 818,779 shares purchasable pursuant to options
exercisable within 60 days of December 31, 1998.

(3) This total includes 2,743 shares held by Mr. Abramson's wife, 6,449 shares
held by his wife in trust for his children, and 12,007 shares held by a
family trust for which Mr. Abramson is trustee, 3,838 shares held by a
family foundation and 50,855 shares held by a trust in which Mr. Abramson
is a trustee.

(4) This total includes 854 shares held in custody for children, 536 shares
held in a trust and 10,944 shares held in an estate for which Ms. Bronander
is one of three executors.

(5) This total includes 219,519 shares held by Mr. Coccia jointly with his
wife, 14,478 shares held by a family foundation and 7,261 shares held by
his wife.

5
<PAGE>

(6) This total includes 770 shares for Mr. Cook's daughter, 550 shares held by
Mr. Cook's wife with a relative, 3,300 shares held for Mr. Cook's mother
for whom Mr. Cook holds power of attorney, 356 shares held as Mr. Cook's
share of a partnership, 2,944 restricted shares, and 3,681 shares
purchasable pursuant to options exercisable within 60 days, but not the
5,522 shares potentially available in the future by exercise of his stock
options not exercisable within 60 days of December 31, 1998.

(7) This total includes 73 shares held by Mr. Crocitto's wife, 1,272 shares
held by Mr. Crocitto as custodian for his children, 9,030 restricted
shares, and 15,749 shares purchasable pursuant to stock options exercisable
within 60 days, but not the 29,241 shares potentially available in the
future by exercise of his stock options not exercisable within 60 days of
December 31, 1998.

(8) This total includes 2,249 shares held by Mr. Drukker's wife, 18,007 shares
held by a trust for which Mr. Drukker is a trustee and of which he is a
beneficiary, 1,138 shares in trust for his children and 4,421 shares held
by a family foundation.

(9) This total includes 3,520 shares in the name of Mr. Hedden's wife.

(10) This total includes 141,150 shares held in the name of Mr. Korde's wife,
29,193 shares held jointly with his wife, 296,202 shares held by his wife
as custodian for his children, 133,804 shares held by a trust for which Mr.
Korde is a trustee and 91,123 shares held by a profit sharing plan which
Mr. Korde controls.

(11) This total includes 43,016 shares held in the name of Mr. Lipkin's wife, 70
shares held jointly with his wife, 4,412 shares held jointly with his
brother, 6,877 shares held by self-directed IRA plans in which Mr. Lipkin
and his wife are beneficiaries and 8,801 shares held by a family
foundation. This total also includes Mr. Lipkin's 20,120 restricted shares
and 92,718 shares purchasable pursuant to options exercisable within 60
days, but not the 39,420 shares potentially available in the future by
exercise of his stock options not exercisable within 60 days of December
31, 1998.

(12) This total includes 54,544 shares held by Ms. Martin jointly with her
husband and 12,840 shares held by her husband.

(13) This total includes 625 shares held in the name of Mr. McEntee's wife,
47,648 shares held jointly with his wife and 3,339 shares held by Mr.
McEntee in a self-directed Keogh plan.

(14) This total includes Mr. Meyer's 6,000 restricted shares and 199,375 shares
purchasable pursuant to options exercisable within 60 days but not the
20,000 shares potentially available in the future by exercise of his stock
options not exercisable within 60 days of December 31, 1998.

(15) This total includes 15,821 shares held jointly with Mr. Pinyuh's wife, and
3,917 shares held in a family foundation.

(16) This total includes 17,187 shares held by a self-directed IRA plan, 19,819
shares held in a self-directed IRA by his wife and 199,212 shares held by
an annuity trust for which Mr. Rachesky is co-trustee.

(17) This total includes 8,047 shares held by Mr. Rukin's wife as custodian and
Mr. Rukin, as trustee, in various accounts for their children, 2,403 shares
held by a private foundation of which Mr. Rukin is an officer and 1,378
shares for a pension in which Mr. Rukin is a trustee.

<PAGE>

(18) This total includes 10,795 shares held in the name of Mr. Southway's wife,
6,937 shares held in a family foundation and 3,388 shares held in self
directed IRA plans. This total also includes Mr. Southway's 14,084
restricted shares and 64,175 shares purchasable pursuant to options
exercisable within 60 days, but not the 26,281 shares potentially available
in the future by exercise of his stock options not exercisable within 60
days of December 31, 1998.

(19) This total includes 852 shares held by Mr. Peter John Southway as custodian
for his children, 9,582 restricted shares and 35,443 shares purchasable
pursuant to stock options exercisable within 60 days, but not the 29,530
shares potentially available in the future by exercise of his stock options
not exercisable within 60 days of December 31, 1998.

(20) This total includes 53,090 shares held jointly with Mr. Tice's wife and
31,832 shares owned by a partnership of which Mr. Tice is a general
partner.

(21) This total includes 2,500 shares held by a family trust.

(22) This total includes 2,243 shares held by Mr. Vozza's wife and 4,015 shares
held by a family foundation.

(23) This total includes 180,880 shares owned by nine executive officers who are
not directors or Named Officers, which total includes 20,841 restricted
shares and 76,473 shares purchasable pursuant to options exercisable within
60 days. The total does not include shares held by the Bank's trust
department.

7
<PAGE>

EXECUTIVE COMPENSATION

General

Executive compensation is described below in the tabular format mandated by
the SEC. The letters in parentheses under each column heading are the letters
designated by the SEC for such columns, and are provided to make inter-company
comparisons easier. The absence of any column designated by the SEC means that
no compensation was paid or earned which would be required to be described in
such column. All share amounts have been re-stated to give effect to stock
splits and stock dividends.

Summary Compensation Table

The following table summarizes all compensation earned in the past three
years for services performed in all capacities for the Corporation and its
subsidiaries with respect to the Named Officers.

<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE

Long Term
Annual Compensation Compensation Awards
------------------- -------------------
(a) (b) (c) (d) (f) (g) (i)
Restricted Securities
Stock Underlying All Other
Name and Principal Awards(s) Options/ Compensation
Position Year Salary($) Bonus($) (1)($) SARs(2)(6)(#) (3)($)
--------- ---- --------- -------- --------- ------------- --------
<S> <C> <C> <C> <C> <C> <C>
Gerald H. Lipkin,............ 1998 480,000 425,000 186,313 18,749 35,078
Chairman, President and 1997 465,000 420,000 135,000 19,688 34,750
CEO of the Corporation 1996 435,000 350,000 123,125 20,670 29,750
and the Bank

Peter Southway,(4)........... 1998 260,000 200,000 130,419 12,499 9,600
Vice Chairman of the 1997 250,000 200,000 94,500 13,125 9,500
Corporation and the Bank 1996 298,077 170,000 86,188 13,781 3,853

Robert Meyer, (5)............ 1998 230,000 90,000 81,562 10,000 9,600
Executive Vice President of 1997 220,000 75,000 99,375 12,500 7,671
the Corporation and the Bank

Peter John Southway,......... 1998 230,000 90,000 81,562 10,000 8,000
Executive Vice President of 1997 210,000 75,000 99,375 12,500 9,500
the Corporation and the Bank 1996 175,000 50,000 77,625 9,842 4,173

Peter Crocitto,.............. 1998 230,000 90,000 81,562 10,000 9,600
Executive Vice President of 1997 200,000 75,000 99,375 12,500 9,500
the Corporation and the Bank 1996 155,000 50,000 77,625 9,842 3,875

- ----------
</TABLE>

8
<PAGE>

NOTES

(1) As required by the SEC rules, the dollar amounts set forth in the columns
are based upon values as of the date of the grants. The dollar amounts set
forth below in this footnote are based on values as of December 31, 1998.
All restrictions on restricted stock awards lapse at the rate of 20% per
year commencing with the first anniversary from the date of grant.
Dividends are credited on restricted stock at the same time and in the same
amount as dividends paid to all other common shareholders. Credited
dividends are accumulated and are subject to the same restrictions as the
underlying restricted stock. The restricted stock awards are made pursuant
to the Valley National Bancorp Long-Term Stock Incentive Plan (the "LTIP").
Upon a "change in control" as defined in the LTIP, all restrictions on
shares of restricted stock will lapse and all options will vest in full.

For Mr. Lipkin, the column represents awards of 6,250 shares in 1998, 6,562
shares in 1997 and 6,890 shares in 1996. As of December 31, 1998, Mr.
Lipkin held an aggregate of 20,120 shares of restricted stock with a value
of $567,133. For Mr. Peter Southway, the column represents awards of 4,375
shares in 1998, 4,593 shares in 1997, and 4,823 shares in 1996. As of
December 31, 1998, Mr. Peter Southway held an aggregate of 14,084 shares of
restricted stock with a value of $396,993. For Mr. Meyer, the column
represents awards of 3,000 shares in 1998 and 3,750 shares in 1997. As of
December 31, 1998, Mr. Meyer held an aggregate of 6,000 shares of
restricted stock with a value of $169,125. For Mr. Peter John Southway, the
column represents awards of 3,000 shares in 1998, 3,750 shares in 1997, and
3,937 shares in 1996. As of December 31, 1998, Mr. Peter John Southway held
an aggregate of 9,582 shares of restricted stock with a value of $270,093.
For Mr. Crocitto, the column represents awards of 3,000 shares in 1998,
3,750 shares in 1997, and 3,937 shares in 1996. As of December 31, 1998,
Mr. Crocitto held an aggregate of 9,030 shares of restricted stock with a
value of $254,533.

(2) The amounts listed represent options granted to the Named Officers in the
form of qualified incentive stock options or nonqualified stock options
(but in either event granted at the fair market value on the date of
grant). All the options vest at the rate of 20% per year commencing with
the first anniversary except as specified otherwise below. Upon a "change
in control" as defined in the LTIP, all options become immediately and
fully exercisable. For 1998, 6,250 of the options granted to Mr. Lipkin and
4,125 of the options granted to Mr. Peter Southway had tandem stock
appreciation rights ("SARs"). For 1997, 6,563 of the options granted to Mr.
Lipkin and 4,331 of the options granted to Mr. Peter Southway had tandem
stock appreciation rights SARs. For 1996, 6,891 of the options granted to
Mr. Lipkin and 4,589 of the options granted to Mr. Peter Southway had
tandem SARs. As to those options/SARs, the executive will have the choice
of exercising the option for stock or obtaining the cash value of the
option on the exercise date.

(3) All amounts shown in this column reflect employer contributions to a 401(k)
plan on behalf of the respective Named Officer, except that $25,250 of the
amount shown for Mr. Lipkin in 1998, 1997 and 1996 represents the cost to
the Corporation of Mr. Lipkin's $1,000,000 split dollar life insurance
plan.

(4) In May, 1996, Mr. Southway requested and was granted a modification to his
work schedule and his compensation was adjusted to reflect his reduction in
duties.

(5) Mr. Meyer joined Valley effective February 28, 1997; his 1997 salary is
shown on an annualized basis.

(6) Stock options/SARS and stock awards have been restated for stock dividends
and stock splits.

Option Grants in 1998

The following table shows the options granted to Named Officers in 1998,
and their potential value at the end of the option term, assuming certain levels
of appreciation of the Corporation's common stock. As noted in footnote (2) to
the preceding table, certain options have been granted in tandem with SARs.

9
<PAGE>

<TABLE>
<CAPTION>
OPTION/SAR GRANTS IN LAST FISCAL YEAR

Potential Realizable
Value at Assumed
Annual Rates of
Stock Price
Appreciation for
Individual Grants Option Term (1)
- -------------------------------------------------------------------------------------- ----------------------
(a) (b) (c) (d) (e) (f) (g)
Percent of
Number of Total
Securities Options/SARs Exercise
Underlying Granted to or Base
Options/SARs Employees in Price Expiration
Name Granted (#) Fiscal Year ($/Sh) Date 5%($) 10%($)
---- ------------ ----------- ------- --------- ------- ------
<S> <C> <C> <C> <C> <C> <C>
Gerald H. Lipkin............ 18,749 (2) 7.7% 29.81 2/09/2008 351,494 890,755
Peter Southway.............. 12,499 (2) 5.1% 29.81 2/09/2008 234,323 593,821
Robert Meyer................ 10,000 (2) 4.1% 27.1875 10/23/2008 170,981 433,299
Peter John Southway......... 10,000 (2) 4.1% 27.1875 10/23/2008 170,981 433,299
Peter Crocitto.............. 10,000 (2) 4.1% 27.1875 10/23/2008 170,981 433,299

- ----------
</TABLE>

NOTES

(1) The dollar amounts under these columns are the result of calculations at
the 5% and the 10% rates set by the SEC and therefore are not intended to
forecast possible future appreciation, if any, of the Corporation's common
stock price. Based upon 55,266,325 common shares outstanding as of December
31, 1998, all shareholders as a group would receive future appreciation of
$979,704,336 with 5% growth, and $2,482,763,139 with 10% growth, over a
10-year period.

(2) These options become exercisable at the rate of 20% per year beginning
February 9, 1999 as to Messrs. Lipkin and Southway and October 23, 1999 as
to Robert Meyer, Peter John Southway and Peter Crocitto. The options
accelerate in the event of a change in control, as defined in the LTIP.

10
<PAGE>

Aggregated Option Exercises in 1998 and Year-End Option Values

The following table shows the options exercised by Named Officers in 1998,
the number of options/SARs remaining unexercised at year-end, and the value of
unexercised in-the-money options/SARs at year end.

<TABLE>
<CAPTION>
AGGREGATED OPTION/SAR EXERCISES IN
LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES

Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options/SARs
Shares Options/SARs at FY-End (#) at FY-End ($)
Acquired on Value
Name Exercise (#) Realized ($) Exercisable/Unexercisable Exercisable/Unexercisable
---- ------------ ------------ ------------------------- -------------------------
(a) (b) (c) (d) (e)
<S> <C> <C> <C> <C>
Gerald H. Lipkin............ 6,266 115,670 71,780/60,358 842,471/384,726
Peter Southway.............. 4,721 87,150 50,220/40,236 614,145/256,513
Robert Meyer................ 0 0 199,375/20,000 4,144,008/26,875
Peter John Southway......... 0 0 35,443/29,530 494,343/115,747
Peter Crocitto.............. 1,751 26,532 15,749/29,241 142,622/113,038
</TABLE>

Pension Plans

Bank Pension Plan. The Bank maintains a non-contributory, defined benefit
pension plan (the "Pension Plan") for all eligible employees. The annual
retirement benefit under the Pension Plan is (i) 0.85 of 1% of the employee's
average final compensation up to the employee's average social security wage
base plus (ii) 1.15% of the employee's average final compensation in excess of
the employee's average social security wage base, (iii) multiplied by the years
of credited service (to a maximum of 35 years). Employees who were participants
in the Pension Plan on December 31, 1988, are entitled to the higher of the
foregoing or their accrued benefit as of December 31, 1988 under the terms of
the plan then in effect. An employee's "average final compensation" is the
employee's highest 5 year average of the employee's annual salary (excluding
bonuses, overtime pay and other special pay), i.e., the amount listed as
"Salary" in the Summary Compensation Table, subject to an annual compensation
limit of $160,000, received during the last 10 years of employment.

11
<PAGE>

The following table shows the estimated annual retirement benefits from the
pension plan, assuming retirement at age 65 and a straight life annuity benefit,
for the compensation levels and years of credited service shown.

<TABLE>
<CAPTION>
PENSION PLAN TABLE

Years of Credited Service
-------------------------------------------------------------
Average Final Compensation 15 20 25 30 35
- -------------------------- -- -- -- -- --
<S> <C> <C> <C> <C> <C>
$ 25,000................... $3,188 $4,250 $5,313 $6,375 $7,438
$ 50,000................... $7,224 $9,632 $12,040 $14,448 $16,857
$ 100,000................... $15,849 $21,132 $26,415 $31,698 $36,982
$ 150,000................... $24,474 $32,632 $40,790 $48,948 $57,107
$ 160,000 and higher........ $25,164 $33,552 $41,940 $50,328 $58,717

- ----------
</TABLE>

NOTES:

1. Amounts shown reflect the $160,000 limit on compensation and the $130,000
maximum benefit payable and represent the benefits that could be paid from
the qualified trust during 1998. These limits are subject to annual cost of
living increases.

2. An employee may receive benefits greater than those shown in the table if
(a) his accrued benefit as of December 31, 1988 under the terms of the
pre-1989 Plan is higher, (b) his accrued benefit as of December 31, 1993
(based on the compensation limits in effect before 1994) is higher, or (c)
he is a participant in the Benefit Equalization Plan, an unfunded
arrangement which provides benefits to a select group of highly compensated
officers, and which is described below.

Benefit Equalization Plan. Effective January 1, 1989, the Bank adopted a
Benefit Equalization Plan which provides retirement benefits in excess of the
amounts payable from the Pension Plan for certain highly compensated officers.
Benefits are determined as follows: (a) the benefit calculated under the Pension
Plan formula in effect prior to January 1, 1989 and without regard to the limits
on recognized compensation and maximum benefits payable from a qualified
deferred benefit plan, minus (b) the individual's Pension Plan benefit. In
general, officers of the Corporation who are members of the Pension Plan and who
receive annual compensation in excess of $145,000 are eligible to participate in
the Benefit Equalization Plan. The Personnel and Compensation Committee of the
Board of Directors has the authority to determine, in its discretion, which
eligible officers will participate in the Benefit Equalization Plan. Effective
January 1, 1989, Gerald Lipkin and Peter Southway became participants in the
Benefit Equalization Plan. Effective January 1, 1996, Peter John Southway and
Peter Crocitto became participants in the Benefit Equalization Plan. No other
officers presently participate.

12
<PAGE>

The following table shows the estimated annual retirement benefits from the
Benefit Equalization Plan and qualified Pension Plan combined, assuming
retirement at age 65 in 1998 and a straight life annuity benefit, for the
compensation levels and years of credited service shown. The chart is calculated
using the average social security wage base and social security benefits in
effect during 1998.

<TABLE>
<CAPTION>
Years of Credited Service
-----------------------------------------------------------------------------
Average Final Compensation 15 20 25 30 35 40
- -------------------------- -- -- -- -- -- --
<S> <C> <C> <C> <C> <C> <C>
$150,000.................... $25,927 $34,570 $43,212 $51,854 $60,497 $69,139
$200,000.................... $35,302 $47,070 $58,837 $70,604 $82,372 $94,139
$250,000.................... $44,677 $59,570 $74,462 $89,354 $104,247 $119,139
$300,000.................... $54,052 $72,070 $90,087 $108,104 $126,122 $144,139
$350,000.................... $63,427 $84,570 $105,712 $126,854 $147,997 $169,139
$400,000.................... $72,802 $97,070 $121,337 $145,604 $169,872 $194,139
$450,000.................... $82,177 $109,570 $136,962 $164,354 $191,747 $219,139
$500,000.................... $91,552 $122,070 $152,587 $183,104 $213,622 $244,139
</TABLE>

Gerald Lipkin, Peter Southway, Peter John Southway and Peter Crocitto have
approximately 23, 39, 20 and 22 years of credited service, respectively, under
the Pension Plan (and with respect to the Benefit Equalization Plan for those
officers who participate in it) as of January 1, 1998, and, at age 65, would
have 30.1, 41.3, 47.1 and 45 years of credited service, respectively. (However,
the maximum currently is 40 years of credited service.) In 1998 the following
persons received the compensation shown below for purposes of determining their
retirement benefits under the Pension Plan (and with respect to the Benefit
Equalization Plan for those officers who participate in it): Gerald Lipkin
$480,000; Peter Southway $260,000; Peter John Southway $230,000; and Peter
Crocitto $230,000. Pursuant to an agreement, effective May 8, 1996, the
Corporation and the Bank guaranteed Peter Southway a minimum pension, expressed
as a joint and survivor annuity of $164,036 if he retired after age 65. Pursuant
to an agreement dated August 17, 1994, commencing at age 57, a minimum
retirement benefit of $150,000 per year is provided to Mr. Lipkin in the form of
a joint and two-thirds survivor annuity which would pay Mr. Lipkin $150,000 per
year and his wife $100,000 per year in the event of Mr. Lipkin's death. Except
as contained in the description of the plan formulas above, the benefits listed
in the tables are not subject to any deduction for social security or other
offset amounts.

13
<PAGE>

Employment Contracts and Termination of Employment and Change of Control
Arrangements

On August 17, 1994, the Corporation and the Bank entered into severance
agreements (the "Severance Agreements"), with Gerald Lipkin and Peter Southway
and as of January 1, 1998 the Corporation and Bank entered into Severance
Agreements with Robert Meyer, Peter John Southway and Peter Crocitto. The
Severance Agreements provide that in the event the Executive is terminated
without cause, he will be entitled to a lump sum payment equal to 12 months of
his annual salary at the time of termination, plus a fraction of the bonus paid
to the Executive in the previous year, where such fraction is the number of
months of the current year during which the Executive served before being
terminated, divided by 12. Mr. Lipkin and Mr. Southway also receive health and
dental benefits through age 65. Mr. Meyer, Mr. Peter John Southway and Mr.
Crocitto receive health, dental benefits, and life insurance and disability plan
continuance for three years. Pursuant to the agreement effective May 8, 1996,
the Corporation amended Mr. Southway's Severance Agreement to use $375,000 as
the applicable annual base salary regardless of the base salary actually paid to
him. With respect to Mr. Lipkin, his Severance Agreement provides additional
payments in the event of his death or disability.

As of January 1, 1999, the Corporation and the Bank entered into amended
and restated change-in-control agreements with Gerald Lipkin, Peter Southway,
Peter John Southway, Peter Crocitto and Robert Meyer. The change-in-control
agreements generally provide employment protection to the covered Executives for
a three-year period following any change-of-control (as defined in the
Agreement). If the Executive is terminated without cause, or if he resigns for
good reason (as defined) the Executive receives a lump sum equal to 3 times the
highest annual compensation paid to the Executive during any calendar year in
the three calendar years immediately preceding the change-in-control, plus three
years of extra service credited under the Benefit Equalization Plan if the
Executive is a participant in the Benefit Equalization Plan, and continuation of
the Executive's health, hospitalization and medical insurance for a three year
period. Payment and the duration of benefits are proportionately reduced as the
Executive reaches his normal retirement age (age 67 for Peter Southway and ages
65 for the other Executives). The change-in-control payments and benefits to the
Executive will be increased by the amount of the excise tax (and related income
and payroll taxes on such amounts) imposed upon all "excess parachute payments"
under the Internal Revenue Code of 1986 (the "Code") so that the Executive will
be entitled to retain the benefit of these promised payments and benefits
without reduction by the excise tax. Excess parachute payments exist when
"parachute payments" (i.e., all payments and benefits contingent on a change in
control) exceed 3 times the employee's average taxable compensation over the
last 5 calendar years. The LTIP provides that upon a "change in control" (as
defined in the LTIP) all restrictions on shares of restricted stock granted
under the LTIP will lapse and all outstanding options under the LTIP will, for a
period of 60 days, become immediately and fully exercisable. The value of any
accelerated vesting is considered a parachute payment.

As of January 1, 1995, the Corporation and the Bank also entered into
change-in-control agreements with all First Senior Vice Presidents and Senior
Vice Presidents who have at least three years of continuous service with the
Bank. These agreements are similar to the change-in-control agreements entered
into with the named Executive Officers except they provide a smaller lump sum
payment and provide a cut-back in the promised payments and benefits to avoid
the excise tax under the Code imposed on "excess parachute payments." Generally,
First Senior Vice Presidents with six years or more of service are entitled to a
lump sum payment equal to two years salary plus a pro rata bonus and
continuation of medical, dental and life insurance benefits. The lump sum is
reduced to one year of base salary and a pro rata bonus for officers with
between three years and six years of service. Similarly, Senior Vice Presidents
with six years or more of service are entitled to one year of base salary and a
pro rata bonus, and the lump sum is six months and a pro rata bonus for Senior
Vice Presidents with between three and six years of service.

All change-in-control agreements are for fixed terms, but provide for
automatic annual extensions unless the Corporation takes specific action to halt
the renewal.

14
<PAGE>

As of July 7, 1995, the Corporation and Mr. Lipkin entered into a split
dollar life insurance arrangement. Under the arrangement, the Corporation agreed
to pay the annual premiums necessary to fund a $1,000,000 second-to-die life
insurance policy on the lives of Mr. Lipkin and his wife. When the policy is
fully paid, or from the death benefits thereunder, the Corporation will be
repaid all of its premium payments made by it (without interest). In return, in
an agreement as of that date, Mr. Lipkin waived all rights he has to group term
policies under the Corporation's benefit policies or otherwise. The split dollar
policy is anticipated to require annual premium payments by the Corporation of
$25,250 for 11 years, although the amount and duration of the premiums depends
on the dividends paid by the insurance company. The Corporation has also agreed
that it will pay the premiums, regardless of whether Mr. Lipkin continues to be
employed by the Corporation.

Director Compensation Arrangements

The Corporation pays its directors a $7,500 annual retainer, plus fees of
$500 per board meeting attended, $1,000 for each audit committee meeting and
personnel and compensation committee meeting and $500 for each other committee
meeting attended. Bank directors fees consist of: an annual retainer of $7,500,
plus $500 for each meeting of the Board attended, $1000 for each executive
committee meeting attended and $500 for each other committee meeting attended.
Directors of the Corporation and the Bank who are salaried officers do not
receive directors' fees or retainers. The Chairmen of the Personnel and
Compensation Committee, the Nominating and Governance Committee, the Audit
Committee, the Insurance Committee and the Community Development and Fair
Lending Committee, currently Messrs. McEntee, Drukker, Rachesky, Vozza and Ms.
Bronander, respectively, each receive an additional retainer of $5,000 per year.

In November 1992, the Corporation instituted a retirement plan for eligible
non-employee directors of the Corporation and/or the Bank with a minimum of 10
years of service. The plan provides for benefits which commence after the
non-employee director has retired from the Board and reached the age of 65. The
benefits terminate in 10 years or earlier upon death of the non-employee
director. The annual benefit is a percentage of the annual Bank and Corporation
retainer paid to the director at the time of retirement, as follows: after 5
years of service (25%), increasing 5% for each additional year of service to
100% after 20 years of service.

Section 16(a) Beneficial Ownership Reporting Compliance

Due to an oversight, certain directors who purchased shares filed a Form 4
on an untimely basis for the number of times set forth in the parenthesis
following each name: Messr. Rukin (2) and Vozza (1).

15
<PAGE>

PERSONNEL AND COMPENSATION COMMITTEE REPORT ON
EXECUTIVE COMPENSATION

The following report was prepared by the Personnel and Compensation
Committee of the Corporation regarding executive compensation policy and its
relation to the Corporation's performance.

COMPENSATION REVIEW PROCESS

The Personnel and Compensation Committee of the Board of Directors (the
"Committee"), consisting entirely of independent outside directors, is
responsible for establishing and overseeing policies governing annual and
long-term compensation programs for officers named in the compensation tables
shown above and other executive officers of the Corporation.

The Committee uses an independent compensation consulting firm to assist in
its deliberations. The Committee has sought the consultant's guidance in
maintaining levels of executive compensation that are consistent with banks that
are similarly situated in terms of business and labor market competition (the
compensation peer group).

With this outside, independent assistance, the Committee evaluates
salaries, annual performance goals and awards under annual incentive plans and
administers the LTIP.

When the Committee's actions relate to officers who also are directors, the
Board of Directors (exclusive of the officer-directors) reviews the
recommendations of the Committee and approves final compensation arrangements.

COMPENSATION STRATEGY

The objective of the Corporation's executive compensation program is to
align compensation with business strategy and the continued enhancement of
shareholder value through stock price growth and dividends.

A total compensation approach to determining appropriate compensation
levels for executive officers has been adopted by the Committee. Target total
compensation levels (consisting of annual base salary, and annual and long-term
incentive award opportunities, including stock options and restricted stock) are
established at the beginning of each year. These targets take into consideration
the Corporation's performance relative to its compensation peer group and total
compensation opportunities for the peer group. Under this total compensation
approach, an increasing amount of the executive total compensation mix is based
on pay-for-performance targets and performance compared to peers.

The organizations used for the purpose of developing compensation targets
are based on labor market competition as well as business competition. These
organizations may differ from the banking organizations included in the industry
group used in the Performance Graph of stock growth and dividend reinvestments
shown below.

Target total compensation is determined through a statistical process that
builds a model of peer group compensation relative to asset size and
performance. The peer group modeling process provides an objective basis to
identify those performance measures best related to compensation in the peer
companies. These performance measures can vary from year to year based on the
statistical results and may include earnings growth, return on assets and return
on equity.

The Corporation's size and performance results are factored into the peer
group model to identify appropriate target total compensation opportunities for
the Corporation's executives. As a result, when performance objectives are
exceeded, executives have an opportunity to realize compensation above their
target total compensation levels. When performance objectives are not met, the
total compensation paid is lower than target.

Specific compensation program components are discussed below.

16
<PAGE>

BASE SALARY

Base salary levels are determined each year, in part, by considering the
labor market levels of compensation paid to executives of comparable banking
organizations. Labor market values are established by the peer group banking
organization modeling process described above and supplemented by the average
results of an analysis of published compensation surveys of similar size
organizations in the banking industry to reflect broader industry trends.

The labor market values are used to create salary ranges. Individual
executive salaries are determined relative to the ranges on the basis of a
subjective assessment of each executive's contribution to the bank's success as
well as the level of knowledge and experience each executive brings to the job.

ANNUAL INCENTIVE PLAN

Consistent with the goals of continued financial strength and shareholder
value creation for 1998, annual incentive awards were based on a combination of
achieving or exceeding corporate objectives for return on average assets and
return on average equity, and individual performance of participating officers.

The annual incentive plan has minimum performance requirements, below which
no bonuses may be awarded. Targets for minimum return on average equity and
return on average assets before extraordinary items are determined each year at
the beginning of the annual incentive plan year.

Each year target annual incentive opportunities for executives are
established using the data from the peer group, again, supplemented by the
combined results of the analysis of published surveys of compensation in the
banking industry and internal relationships. The Committee adopted a policy of
setting target opportunities near the average of those available in the
competitive market place. Target awards range up to 60% or more of base salary.

Actual annual incentive awards are determined through a performance
measurement process relative to achievement of the Corporation goals and
individual performance objectives. Corporate performance can account for up to
75% of each participant's target award. Individual performance achievement
measures are both objective (e.g., pre-determined goals) and subjective (e.g.,
Board assessment of the executive's leadership and management of resources). In
addition, the Committee can, at its discretion, adjust individual awards by plus
or minus 20%. As a result, actual awards can range from 0% to 115% of an
executive's base salary depending on Corporation and individual performance.

LONG-TERM INCENTIVE PLAN

Long-term incentive awards may be granted in the form of stock options
(qualified incentive stock options or non-qualified stock options), stock
appreciation rights and/or restricted stock. The purpose of these awards is to
align executive long-term compensation opportunities with the realization of
stock price growth and dividends for shareholders.

The number of stock options and restricted stock awards are determined on
an annual basis using the target long-term incentive award opportunity as a
guide. This is initially the difference between the target total compensation
opportunity and the sum of the executive's base salary and target annual
incentive award opportunity. A combination of restricted stock and stock options
are then awarded up to the target long-term incentive award opportunity on a
subjective basis, taking into account the Corporation's performance, competitive
practices, and individual performance. Previous stock option and restricted
stock awards also may be considered by the Committee and the Board, at its
discretion, in determining the number of stock option and restricted shares to
be granted.

17
<PAGE>

COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
AND OTHER NAMED EXECUTIVE OFFICERS

In 1998, Mr. Lipkin was granted a 3.2% salary increase, bringing his base
salary level to $480,000. This salary increase recognizes Mr. Lipkin's
contribution to the Corporation's success, the level of knowledge and experience
he brings to the job of Chairman and Chief Executive Officer, and the labor
market levels of compensation paid to Chief Executive Officers of comparable
banking organizations. Additionally, Mr. Lipkin led the Corporation in achieving
annual objectives.

Salary adjustment for the other named executive officers ranged from 4% to
15% of their base salaries and reflected certain realignment of duties and
responsibilities as well as individual officer contributions to the growth of
the Bank, experience and skill levels and the movement of salaries in
competitive labor markets.

The 1998 base salary levels were determined in accordance with the
Corporation's policy as described in "Base Salary" above.

In 1998, the Corporation's performance met targeted levels and approved
goals. Mr. Lipkin contributed to this success by developing the Corporation
management team, improving the Corporation's financial strength, broadening the
product line and expanding market share. As a result of these contributions, Mr.
Lipkin's annual incentive award was therefore 89% of his base salary.

For the other named executive officers, the 1998 annual incentive awards
averaged 49% of their 1998 salaries. These awards ranged from 39% to 77% for
these individuals, reflecting differences in business unit results and
organization level.

The 1998 annual incentive awards were determined in accordance with the
Corporation's policy as described in "Annual Incentive Plan" above.

As part of the total compensation program, in 1998 Mr. Lipkin was awarded a
stock option for 18,749 shares at $29.81 per share, the market value on the date
of grant. 6,250 shares of this option grant were awarded with tandem Stock
Appreciation Rights ("SARs") under which Mr. Lipkin has the choice of exercising
the option shares for stock or exercising the SAR for cash, subject to approval
of the Compensation Committee at the time of exercise. Mr. Lipkin also was
awarded 6,250 shares of restricted Corporation common stock at $29.81 per share.
The stock options become exercisable and the restricted stock becomes vested at
the rate of 20% per year starting with the first anniversary from the date of
grant. Mr. Lipkin's opportunity to receive value from the option awards is
contingent on the growth of the Corporation's stock price over the vesting
period of the awards.

During 1998, other executive officers named in the compensation tables
received qualified incentive stock option grants totaling 42,499 shares at an
average grant price of $27.84 per share. One of these executives received a
4,125 tandem SAR. As a group, the other named executive officers received
restricted stock awards totaling 13,375 shares at an average price at grant of
$27.84 per share. All of these shares were granted at the market value on the
date of grant. All of the factors relating to exercise of options and tandem
SARs and the vesting of restricted stock noted above for Mr. Lipkin apply to
these stock awards.

The long-term incentive awards to executive officers in 1998 were made in
accordance with the total target compensation approach described under
"Long-Term Incentive Plan" above. In addition, previous stock options and
restricted stock awards were considered in making these awards.

DEDUCTIBILITY OF COMPENSATION

As part of the 1993 Omnibus Budget Reconciliation Act ("OBRA '93") under
Section 162(m) of the Code effective for taxable years beginning on or after
January 1, 1994, companies are subject to limits on the deductibility

<PAGE>

of executive compensation. OBRA '93 limits deductible compensation for the
active named executive officers to $1 million per year. Certain forms of
compensation are exempt from this deductibility limit, primarily
performance-based compensation which has been approved by shareholders.

Based on its 1999 salaries, annual incentive awards, stock option and
restricted stock awards, the Corporation does not expect any of its active named
executive officers to materially exceed the $1 million deductibility threshold
during the 1999 taxable year.

Detailed information related to the compensation of the five executive
officers is shown in the compensation tables within this Proxy Statement.

Personnel and Compensation Committee Members:

Robert E. McEntee, Chairman
Andrew B. Abramson
Austin C. Drukker
Graham O. Jones
Gerald Korde
Robert Rachesky
Richard F. Tice

19
<PAGE>

PERFORMANCE GRAPH

The following graph compares the cumulative total return on a hypothetical
$100 investment made on January 1, 1994 in: (a) the Corporation's common stock:
(b) the Standard and Poor's ("S&P") 500 Stock Index: and (c) Keefe, Bruyette &
Woods (KBW) Eastern Region Index of banking organizations. The graph is
calculated assuming that all dividends are reinvested during the relevant
periods. The graph shows how a $100 investment would increase or decrease in
value over time, based on dividends (stock or cash) and increases or decreases
in the market price of the stock and each of the indexes.

INDEX OF TOTAL RETURNS: VALLEY NATIONAL, S&P 500, KBW EASTERN
JANUARY 1, 1994 - DECEMBER 31, 1998

- --------------------------------------------------------------------------------
1/94 12/94 12/95 12/96 12/97 12/98
- --------------------------------------------------------------------------------
Valley National Bancorp 100.0 130.3 131.7 147.2 243.5 225.7
- --------------------------------------------------------------------------------
KBW Eastern Region 100.0 88.8 150.7 206.7 330.7 344.6
- --------------------------------------------------------------------------------
S&P 500 Index 100.0 101.3 138.9 170.4 226.8 291.0
- --------------------------------------------------------------------------------

20
<PAGE>

PERSONNEL AND COMPENSATION COMMITTEE INTERLOCKS AND
INSIDER PARTICIPATION

All members of the Personnel and Compensation Committee have engaged in
loan transactions with the Bank. Committee members include Messrs. McEntee
(Chairman), Abramson, Drukker, G. Jones, Korde, Rachesky and Tice. All such
loans were made in the ordinary course of business of the Bank. No other
relationships required to be reported under the rules promulgated by the SEC
exist with respect to members of the Corporation's Personnel and Compensation
Committee.

CERTAIN TRANSACTIONS WITH MANAGEMENT

The Bank has made and, assuming continued compliance with generally
applicable credit standards, expects to continue to make loans to its directors
and executive officers and their associates. All of such loans (i) were made in
the ordinary course of business, (ii) were made on substantially the same terms,
including interest rates and collateral, as those prevailing at the time for
comparable transactions with other persons, and (iii) did not involve more than
the normal risk of collectibility or present other unfavorable features.

During 1998, Valley National Bank, and its predecessor, Wayne Savings Bank,
F.S.B., paid for legal services to a law firm whose partner is Harold P. Cook,
III, a director and shareholder of Wayne until its merger into the Bank and
currently a director and shareholder of the Corporation. Wayne was merged into
the Bank on October 16, 1998. In addition, during 1998, Valley National Bank
paid for legal services to a law firm whose partner is Graham O. Jones, a
director and shareholder of the Corporation.

Recommendation and Vote Required on Proposal 1

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE NOMINATED
SLATE OF DIRECTORS INCLUDED IN PROPOSAL 1. Directors will be elected by a
plurality of the votes cast on Proposal 1, by proxy or in person, by holders of
Common Stock.

21
<PAGE>

PROPOSAL 2 - APPROVAL OF THE VALLEY NATIONAL BANCORP
1999 LONG-TERM STOCK INCENTIVE PLAN

APPROVAL OF THE 1999 STOCK INCENTIVE PLAN

The Board of Directors has approved for submission to the Corporation's
shareholders the Valley National Bancorp 1999 Long-Term Stock Incentive Plan
(the "1999 Stock Incentive Plan") as set forth in Exhibit A to this Proxy
Statement. The full text of the 1999 Stock Incentive Plan is attached to this
Proxy Statement as Exhibit A and the following description of the 1999 Stock
Incentive Plan is qualified in its entirety by reference to Exhibit A. The
purposes of the 1999 Stock Incentive Plan are to provide additional incentive to
officers and key employees of the Corporation and its Subsidiaries, to motivate
such officers and employees to faithfully and diligently perform their
responsibilities, to attract and retain competent and dedicated individuals, and
to align the interests of those officers and employees more closely with the
interests of the Corporation's shareholders.

TYPES OF OPTIONS AND AWARDS

The 1999 Stock Incentive Plan provides that the Committee may grant
Eligible Employees Incentive Stock Options, Non-qualified Stock Options,
Restricted Stock Awards and Stock Appreciation Rights. All options and awards to
be granted under the 1999 Stock Incentive Plan are options for or awards
relating to shares of the Corporation's common stock. "Incentive Options" to be
granted under the 1999 Stock Incentive Plan are intended to constitute
"incentive stock options" within the meaning of Section 422 of the Code.
"Non-qualified stock options" are those options, which when granted or due to
subsequent disqualification, do not qualify as incentive stock options within
the meaning of Section 422 of the Code.

SHARES SUBJECT TO THE 1999 STOCK INCENTIVE PLAN

In approving the 1999 Stock Incentive Plan, the Board of Directors provided
for the issuance under the 1999 Stock Incentive Plan of 2,500,000 shares of
which not more than an aggregate of 250,000 shares may be issued or transferred
pursuant to options and/or awards to any one Eligible Employee. Subject to the
foregoing aggregate limitations, the maximum number of shares that may be issued
or transferred pursuant to options or awards for Incentive Stock Options,
Non-qualified Stock Options and Stock Appreciation Rights will be 2,000,000 and
the maximum number of shares that may be issued or transferred pursuant to
awards of Restricted Stock will be 500,000.

The 1999 Stock Incentive Plan provides that the Committee shall
conclusively determine the appropriate adjustments, if any, to the number of
shares available and purchase price for stock options and awards in the case of
a Change in Capitalization (as defined in the 1999 Stock Incentive Plan). Any
such adjustment to shares subject to outstanding Incentive Stock Options will be
made in a manner as not to constitute a modification as defined by Section
425(h)(3) of the Code and only to the extent otherwise permitted by Sections 422
and 425 of the Code.

TERMINATION AND AMENDMENT

The 1999 Stock Incentive Plan will terminate on the day preceding the tenth
anniversary of its effective date. However, the Board of Directors has the right
to terminate the 1999 Stock Incentive Plan at any time.

The Board also has the right to amend the 1999 Stock Incentive Plan.
However, without the approval of the Corporation's shareholders no amendment may
be made to the 1999 Stock Incentive Plan if the amendment would, except as
provided under the 1999 Stock Incentive Plan for a Changes in Capitalization,
(a) increase the maximum number of shares as to which options or awards may be
granted under the 1999 Stock Incentive Plan, or (b) change the class of persons
eligible to participate.

22
<PAGE>

The following amendments do not require Shareholder approval unless
required by law or regulation to preserve the intended benefits of the 1999
Stock Incentive Plan to the Corporation or the participants: (a) change the
minimum purchase price of shares pursuant to options or awards as provided in
the 1999 Stock Incentive Plan, (b) extend the maximum period for granting
options under the 1999 Stock Incentive Plan, or (c) otherwise materially
increase the benefits accruing to Eligible Employees under the 1999 Stock
Incentive Plan.

The rights under any option or award granted before any amendment to the
1999 Stock Incentive Plan may not be adversely effected by such amendment,
except with the consent of the optionee or grantee, as the case may be.

ADMINISTRATION

The 1999 Stock Incentive Plan will be administered by a committee
designated by the Board (the "Committee"). Each member of the Committee will be
a Non-Employee Director (as defined in Rule 16b-3 of the Exchange Act) and an
"outside director" within the meaning of Section 162(m) of the Code. A majority
of the Committee will constitute a quorum and a majority of a quorum may
authorize any action. No failure to be so qualified will invalidate any option
or award or any action or inaction under the 1999 Stock Incentive Plan.

The Committee will have the power to identify each officer or key employee
qualified to receive an option or award (an "Optionee" or "Grantee,"
respectively) and determine the number of shares subject to each option or
award, the date of grant and the terms and conditions governing the option or
award. The Committee will also be charged with the responsibility of
interpreting the 1999 Stock Incentive Plan and making all administrative
determinations.

ELIGIBILITY

All officers and other key employees of the Corporation or its subsidiaries
designated by the Committee will be eligible to receive options or awards under
the 1999 Stock Incentive Plan ("Eligible Employees"), but no person may receive
any options or awards unless he is an employee of the Corporation or a
subsidiary at the time the option or award is granted.

TERMS AND CONDITIONS OF STOCK OPTIONS

TERM

All options to be granted under the 1999 Stock Incentive Plan will be for
such term as the Committee determines, provided that (i) all Incentive Stock
Options will not be exercisable after the expiration of ten years from the date
granted, and (ii) all Non-qualified Stock Options will not be exercisable after
the expiration of ten years and one day from the date granted. The Committee
may, subsequent to the granting of any option, extend the term thereof but in no
event shall the term as so extended exceed the maximum term provided for in the
preceding sentence. The 1999 Stock Incentive Plan provides that any options
which are intended to be Incentive Stock Options and are granted to an Optionee
who owns more than 10% of Corporation common stock (a "Ten-Percent Shareholder")
must have terms of five years or less.

PURCHASE PRICE

The 1999 Stock Incentive Plan provides that the purchase price shall be set
forth in the grant agreement between the Eligible Employee and the Corporation.
The purchase price per share under each Incentive Stock Option must not be less
than 100% of the fair market value of a share at the time the option is granted
(110% in the case of an Incentive Stock Option granted to a Ten-Percent
Shareholder) and the purchase price per share under each Non-qualified Stock
Option must not be less than 80% of the fair market value of a share at the time
the option is granted. The 1999 Stock Incentive Plan defines "fair market value"
on any date generally, as the last sale price reported on the New York Stock
Exchange.

23
<PAGE>

The 1999 Stock Incentive Plan provides that the purchase price for shares
purchased pursuant to the exercise of any option is payable in full at the time
of exercise. The purchase price may be paid in cash, by check, or at the
discretion of the Committee and upon such terms and conditions as the Committee
shall approve, by transferring shares to the Corporation.

EXERCISE PERIOD

The 1999 Stock Incentive Plan provides that if an Optionee's employment
terminates by reason of death or disability, the right of the Optionee, his or
her estate, beneficiary or representative to exercise any outstanding, vested
options will terminate one year following such termination of employment and
shall thereafter terminate. If the termination of employment is due to the
Optionee's "Retirement" (as defined in the 1999 Stock Incentive Plan), the
option will be exercisable for a period of 18 months following such termination
of employment. If an Optionee's employment terminates by reason of dismissal for
"Cause" (as defined in the 1999 Stock Incentive Plan) or is by the Optionee
(other than due to the Optionee's Retirement) the right of the Optionee to
exercise any outstanding, vested options will terminate on the date of such
termination of employment. If an Optionee's employment terminates without cause,
the option will be exercisable for a period of 90 days following termination of
employment.

Notwithstanding the foregoing, the Committee may provide, either at the
time the option is granted or thereafter, that the option may be exercised after
periods provided above, but in no event beyond the term of the option.

Upon death or termination of employment due to disability or Retirement,
all options become immediately and fully exercisable.

CHANGE IN CONTROL PROVISIONS

In the event of a Change in Control (as defined in the 1999 Stock Incentive
Plan), all options outstanding on the date of such a Change of Control shall
become immediately and fully exercisable.

TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS

TERM

All Stock Appreciation Rights available for issuance under the 1999 Stock
Incentive Plan will be for such term as the Committee determines. If granted in
connection with an option, such Stock Appreciation Right will cover the same
shares covered by the option (or such lesser number of shares as the Committee
may determine) and, except as provided below, be subject to the same term as the
related option.

EXERCISE

The 1999 Stock Incentive Plan provides that a Stock Appreciation Right
granted in connection with an option is exercisable only at such time or times
and to the extent that the related option is exercisable. If such Stock
Appreciation Right is connected to an Incentive Stock Option it will be
exercisable only if the fair market value of a share on the date of exercise
exceeds the purchase price of the related Incentive Stock Option. The 1999 Stock
Incentive Plan provides that a Stock Appreciation Right unrelated to an option
will contain such terms and conditions as to exercisability, vesting and
duration as the Committee will determine, but in no event shall they have a term
of greater than ten years. Upon the death, disability, or Retirement of a
Grantee, all Stock Appreciation Rights become immediately exercisable. Upon the
Retirement of a Grantee, the Stock Appreciation Rights held by that Grantee will
be exercisable for a period of 90 days following such termination of employment.
Other exercise terms generally parallel those applicable to options.

24
<PAGE>

PAYMENT

The 1999 Stock Incentive Plan provides that upon exercise of a Stock
Appreciation Right related to an option the Grantee will receive an amount
determined by multiplying (A) the excess of fair market value of a share on the
date of exercise of such Stock Appreciation Right over the per share purchase
price under the related option, by (B) the number of shares as to which such
Stock Appreciation Right is being exercised. Notwithstanding the foregoing, the
Committee may limit in any manner the amount payable with respect to any Stock
Appreciation Right by including such a limit in the Agreement evidencing the
Stock Appreciation Right at the time it is granted. The 1999 Stock Incentive
Plan provides that upon exercise of a Stock Appreciation Right unrelated to an
option the Grantee will receive an amount determined by multiplying (A) the
excess of fair market value of a share on the date of exercise of such Stock
Appreciation Right over the per share fair market value of a share on the date
of the grant of the Stock Appreciation Right, by (B) the number of shares as to
which such Stock Appreciation Right is being exercised. The Committee has
discretion to make such payments either solely in shares of the Corporation's
Common Stock in a number determined at their fair market value on the date of
exercise of the Stock Appreciation Right or in cash or in a combination of cash
and shares.

RESTRICTIONS

The 1999 Stock Incentive Plan provides that no Stock Appreciation Right may
be exercised before the date six months after the date it is granted, except in
the event of death or disability of the Grantee before the expiration of the
six-month period or in the event of a Change in Control.

CHANGE IN CONTROL

In the event of a Change in Control, subject to the Restrictions
immediately above, all Stock Appreciation Rights shall become immediately and
fully exercisable.

TERMS AND CONDITIONS OF RESTRICTED STOCK

TERMS AND CONDITIONS

The 1999 Stock Incentive Plan provides that upon granting a Restricted
Stock Award an Agreement between the Grantee and the Corporation will set forth
the restrictions, terms, and conditions of the award. Such Agreement may require
that an appropriate legend be placed on share certificates. Upon the grant of
the Restricted Stock, the shares will be issued in the name of the Grantee as
soon as reasonably practicable after the purchase price, if any, is paid, and
such shares will be deposited with the Escrow Agent pending termination of the
restrictions which apply thereto. The 1999 Stock Incentive Plan provides that
upon delivery of such shares to the Escrow Agent, the Grantee will have all
rights of a shareholder with respect to the shares, including the right to vote
and the right to receive all dividends paid or made with respect to the shares,
unless the Committee, in its discretion, determines that such payment of
dividends should be deferred.

If a Grantee receives rights or warrants with respect to any shares which
were awarded to him as Restricted Stock, such rights or warrants or any shares
or other securities he acquires by the exercise of such rights or warrants may
be held, exercised, sold or otherwise disposed of by the Grantee free and clear
of the restrictions and obligations provided by the 1999 Stock Incentive Plan.

At the time of an Award of shares of Restricted Stock, the Committee may,
in its discretion, determine that the payment to the Grantee of dividends, or a
specified portion thereof, declared or paid on shares of Restricted Stock by the
Company shall be deferred until the earlier to occur of (i) the lapsing of the
restrictions imposed upon such shares, in which case such dividends shall be
paid over to the Grantee, or (ii) the forfeiture of such shares under Section
8(b) hereof, in which case such dividends shall be forfeited to the Company, and
such dividends shall be held by the Company for the account of the Grantee until
such time. In the event of such deferral, interest shall be credited on the
amount of such dividends held by the Company for the account of the Grantee from
time to time at such rate per annum

<PAGE>

as the Committee, in its discretion, may determine. Payment of deferred
dividends, together with interest accrued thereon as aforesaid, shall be made
upon the earlier to occur of the events specified in (i) and (ii) of the
immediately preceding sentence, in the manner specified therein.

RESTRICTIONS

The 1999 Stock Incentive Plan provides that the restrictions upon the
shares of Restricted Stock will lapse at the time or times and on the terms,
conditions and satisfaction of performance criteria as the Committee determines
as may be set forth in the Agreement. Such restrictions will only lapse if the
Grantee on the date of the lapse is then and has continuously been an employee
of the Corporation or a subsidiary from the date the award was granted. In the
event of a Change in Control, all restrictions upon any shares of Restricted
Stock lapse immediately and all such shares become fully vested in the Grantee.
In the event of termination of employment as a result of death, disability or
Retirement of a Grantee, all restrictions upon shares of Restricted Stock
awarded to such Grantee shall thereupon immediately lapse. The Committee may
also decide at any time in its absolute discretion and on such terms and
conditions as it deems appropriate, to remove or modify the restrictions upon
shares of Restricted Stock awarded. When the restrictions lapse, the Corporation
will deliver to the Grantee a certificate for the number of shares of common
stock without any legend or restrictions (except those required by federal or
state securities laws) equivalent to the number of shares of Restricted Stock
for which the restrictions have terminated.

FEDERAL TAX CONSEQUENCES UNDER THE 1999 STOCK INCENTIVE PLAN

The following is a summary of the Federal income tax consequences of
transactions under the 1999 Stock Incentive Plan, based on Federal income tax
laws in effect on January 1, 1999. This summary is not intended to be
comprehensive and does not describe state or local income tax consequences.

Pursuant to the 1999 Stock Incentive Plan, Eligible Employees may be
granted the following benefits: incentive stock options, nonqualified stock
options, stock appreciation rights and restricted stock awards.

Incentive Stock Options. No income is realized by an optionee upon the
grant or exercise of an incentive stock option. If shares of common stock are
transferred to an optionee upon the exercise of an incentive stock option, and
if no disqualifying disposition of such shares is made by such optionee within
two years after the date of grant of the option or within one year after the
transfer of such shares to such optionee, then (1) upon the sale or exchange of
such shares, any amount realized in excess of the option exercise price will be
taxed to such optionee as a long-term capital gain and any loss sustained will
be treated as a long-term capital loss, and (2) no deduction will be allowed to
the Corporation for Federal income tax purposes. The exercise of an incentive
stock option will give rise to an item of tax preference that may result in
alternative minimum tax liability for the optionee.

If common stock acquired upon the exercise of an incentive stock option is
disposed of prior to two years after the grant date or one year after the
exercise date, generally (1) the optionee will realize compensation (i.e.,
ordinary income) in the year of disposition in an amount equal to the excess (if
any) of the fair market value of such shares at exercise (or if less, the amount
realized on the disposition of such shares, if the shares are disposed of by
sale or exchange) over the option exercise price paid for such shares, and (2)
the Corporation will be entitled to deduct the amount of compensation income,
which was taxed to the optionee for Federal income tax purposes, if it complies
with applicable reporting requirements (the "reporting requirements") and if the
amount represents an ordinary and necessary business expense of the Corporation
(the "ordinary and necessary test"). Any further gain (or loss) realized by the
optionee will be taxed as short-term or long-term capital gain (or loss), as the
case may be, and will not result in any deduction by the Corporation. Different
rules may apply if common stock is purchased by an optionee who is also an
officer or more than 10% shareholder. See "Special Rules Applicable to Corporate
Insiders," below.

If an incentive stock option is exercised more than three months following
the termination of employment, the exercise of the option will generally be
taxed in the same manner as the exercise of a nonqualified stock option, except
if the termination is due to the death or disability of the employee.

26
<PAGE>

Nonqualified Stock Options. Except as noted below, in the case of
nonqualified stock options: (1) no income is realized by the optionee at the
time the option is granted; (2) the optionee realizes ordinary income at
exercise in an amount equal to the difference between the option exercise price
paid for the shares and the fair market value of the shares on the date of
exercise; (3) the Corporation is entitled to a Federal income tax deduction
equal to the amount of income taxed to the optionee, subject to the
Corporation's satisfaction of the reporting requirements and the ordinary and
necessary test; and (4) upon disposition of the common stock acquired by
exercise of the option, appreciation (or depreciation) occurring after the date
of exercise is treated as either short-term or long-term capital gain (or loss),
depending on the recipient's holding period of the shares. Different rules may
apply if common stock is purchased by an optionee who is also an officer or more
than 10% shareholder. See "Special Rules Applicable to Corporate Insiders,"
below.

Stock Appreciation Rights. No income will be realized by a grantee in
connection with the grant of a stock appreciation right. When the right is
exercised, the grantee generally will be required to include in gross income as
ordinary income in the year of exercise an amount equal to the amount of cash
received and the fair market value of any shares of common stock received on the
exercise. At the same time, the Corporation will be entitled to a deduction for
Federal income tax purposes equal to the amount included in the grantee's gross
income by reason of the exercise, subject to satisfaction of the reporting
requirements and the ordinary and necessary test.

Upon disposition of common stock acquired upon the exercise of a stock
appreciation right, appreciation (or depreciation) occurring after the date of
exercise will be treated as either short-term or long-term capital gain (or
loss), depending on the recipient's holding period of the shares. In addition,
different income recognition rules may apply if common stock is received on
exercise by a grantee who is also an officer or more than 10% shareholder. See
"Special Rules Applicable to Corporate Insiders," below.

Restricted Stock Awards. A recipient of restricted stock generally will not
be subject to tax at the time the restricted stock is received, but it will be
subject to tax at ordinary income rates on the excess of: 1) the fair market
value of the restricted stock when the restricted stock is first either
transferable or not subject to a substantial risk of forfeiture, over 2) the
amount (if any) paid for the stock by the recipient. However, a recipient who so
elects under Section 83(b) of the Code within 30 days of the date of transfer of
the shares will recognize taxable ordinary income in the year of receipt of the
shares equal to the excess of the fair market value of such shares of restricted
stock at the time of such transfer (determined without regard to the
restrictions) over the purchase price (if any) of such restricted stock. Upon
the subsequent sale or exchange of such stock, the recipient will recognize
capital gain or loss measured by the difference between the amount realized on
the disposition and the basis of the restricted stock, which will equal the sum
of the amount paid for the stock, plus the amount included in gross income upon
the transfer.

If the restricted shares subject to a Section 83(b) election are forfeited
before they are vested, the recipient may be entitled to a capital loss for
Federal income tax purposes equal to the purchase price (if any) of the
forfeited shares, but the recipient will not be entitled to a loss with respect
to any income recognized as a result of the Section 83(b) election.

With respect to the sale of the shares after the forfeiture period has
expired, the holding period to determine whether the recipient has long-term or
short-term capital gain or loss generally begins when the restrictions expire
and the tax basis of such shares will generally be based on the fair market
value of such shares on such date. However, if the recipient timely elects to be
taxed as of the date of the transfer of shares, the holding period commences on
such date and the tax basis will be equal to the fair market value of the shares
on such date (determined without regard to the restrictions). The recipient's
employer generally will be entitled to a deduction equal to the amount that is
taxable as ordinary income to the recipient, subject to the reporting
requirements and the ordinary and necessary test.

Dividends on Restricted Stock. Dividends on restricted stock transferred to
a participant in the 1999 Stock Incentive Plan which are paid prior to the time
such stock becomes vested or transferable by the recipient will generally be
treated as compensation which is taxable as ordinary income to the participant
and will be deductible

27
<PAGE>

by the Corporation, subject to satisfaction of the reporting requirements and
the ordinary and necessary test. However, if the recipient of restricted stock
makes a timely Section 83(b) election with respect to the stock, dividends paid
on such stock will be treated as dividend income which is taxable as ordinary
income to the recipient, but will not be deductible by the Corporation.

Special Rules Applicable to Corporate Insiders. Generally, individuals
subject to Section 16(b) of the Exchange Act ("Insiders") are not taxed until
six months after exercise of a nonqualified stock option, with the excess of the
fair market value of the shares of common stock received upon exercise over the
option purchase price, determined as of the end of the six-month period, being
taxed as ordinary income, and the holding period for treating any gain (or loss)
as long-term capital gain (or loss) beginning at the end of such period. (A
similar rule applies with respect to shares received upon the exercise of stock
appreciation rights.) However, an Insider who elects to be taxed under Section
83(b) of the Code should be taxed on the excess of the fair market value of the
shares at the time of exercise over the option purchase price.

Stock Swaps. The 1999 Stock Incentive Plan provides that, with the
Corporation's permission, an optionee may transfer previously owned shares to
the Corporation to satisfy the purchase price under an option (a "Stock Swap").
Generally, if an optionee utilizes previously owned shares to purchase shares
upon the exercise of an incentive stock option, the optionee will not realize
any gain upon the exchange of the old shares for the new shares and will carry
over into the same number of new shares the basis and holding period for the old
shares. If the optionee purchases more shares than the number of old shares
surrendered in the Stock Swap, the incremental number of shares received in the
Stock Swap will have a basis of zero and a holding period beginning on the date
of the exercise of the incentive stock option. If, however, shares acquired
through the exercise of an incentive stock option are used in a Stock Swap prior
to the end of the statutory holding period applicable to the old shares, the
Stock Swap will constitute a disqualifying disposition of the old shares,
resulting in the immediate recognition of ordinary income (see "Incentive Stock
Options," above).

If a Stock Swap is used to exercise a nonqualified stock option, the use of
old shares to pay the purchase price of an equal number of new shares generally
will be tax-free to the optionee, and he will carry over into the new shares the
basis and holding period of the old shares. However, if more shares are acquired
than surrendered, the incremental shares received in the Stock Swap will
generally be taxed as compensation income in an amount equal to their fair
market value at the time of the Stock Swap. The Optionee's basis in those
additional shares will be their fair market value taken into account in
quantifying the Optionee's compensation income and the holding period for such
shares will begin on the date of the Stock Swap.

Capital Gains. Under current law, a taxpayer's net capital gain (i.e., the
amount by which the taxpayer's net long-term capital gains exceed his net
short-term capital losses) from a sale of shares is subject to a maximum federal
income tax rate of 20% if the shares have been held for more than 12 months.
Ordinary income is subject to tax at rates as high as 39.6%. Capital losses are
currently deductible against capital gains without limitation, but are currently
deductible against ordinary income in any year only to the extent of $3,000
($1,500 in the case of a married individual filing a separate return). Capital
losses which are not currently deductible by reason of the foregoing limitation
may be carried forward to future years.

1999 STOCK INCENTIVE PLAN BENEFITS

There were approximately 380 officers and 1,501 other employees of the
Corporation and its Subsidiaries as of December 31, 1998. Because the Committee
has full discretion to determine who is a key employee, there is no way to
predict how many employees may ultimately receive awards or options under the
1999 Stock Incentive Plan or determine in advance the benefits or amounts that
will be received in the future by or allocated to specific officers or
employees, or groups thereof under the 1999 Stock Incentive Plan. No officers or
other employees have received awards or will receive awards before the date of
the Shareholder meeting.

28
<PAGE>

Recommendation and Vote Required on Proposal 2

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" PROPOSAL 2.
Approval of the proposed 1999 Stock Incentive Plan requires the affirmative vote
of a majority of the votes cast on Proposal 2, by proxy or in person, by the
holders of Common Stock.

29
<PAGE>

INDEPENDENT PUBLIC ACCOUNTANTS

KPMG LLP, independent public accountants, have audited the books and
records of the Corporation since 1986. Selection of the Corporation's
independent public accountants for the 1999 fiscal year will be made by the
Board subsequent to the Annual Meeting.

KPMG has advised the Corporation that one or more of its representatives
will be present at the Annual Meeting of shareholders to make a statement if
they so desire and to respond to appropriate questions.

SHAREHOLDER PROPOSALS

New Jersey corporate law requires that the notice of shareholders' meeting
(for either a regular or special meeting) specify the purpose or purposes of
such meeting. Thus any substantive proposal, including shareholder proposals,
must be referred to in the Corporation's notice of shareholders' meeting for
such proposal to be properly considered at a meeting of the Corporation.

Proposals of shareholders which are eligible under the rules of the SEC to
be included in the Corporation's year 2000 proxy material must be received by
the Secretary of the Corporation no later than November 3, 1999.

If the Corporation changes its 2000 Annual Meeting date to a date more than
30 days from the date of its 1999 Annual Meeting, then the deadline referred to
in the preceding paragraph will be changed to a reasonable time before the
Corporation begins to print and mail its proxy materials. If the Corporation
changes the date of its 2000 Annual Meeting in a manner that alters the
deadline, the Corporation will so state under Item 5 of the first quarterly
report on Form 10-Q it files with the SEC after the date change.

30
<PAGE>

OTHER MATTERS

The Board of Directors is not aware of any other matters that may come
before the annual meeting. However, in the event such other matters come before
the meeting, it is the intention of the persons named in the proxy to vote on
any such matters in accordance with the recommendation of the Board of
Directors.

Shareholders are urged to sign the enclosed proxy, which is solicited on
behalf of the Board of Directors, and return it in the enclosed envelope.

By Order of the Board of Directors

Gerald H. Lipkin
Chairman, President and
Chief Executive Officer

Wayne, New Jersey
March 1, 1999

A copy of the Corporation's Annual Report on Form 10-K (without exhibits)
filed with the Securities and Exchange Commission will he furnished to any
shareholder on written request addressed to Alan Eskow, Senior Vice President,
Valley National Bancorp, 1455 Valley Road, Wayne, New Jersey 07474.

31
<PAGE>

EXHIBIT A

VALLEY NATIONAL BANCORP
1999 LONG-TERM STOCK INCENTIVE PLAN
(Adopted by Directors January 19, 1999)

1. Purpose. The purpose of the Plan is to provide additional incentive to
those officers and key employees of the Company and its Subsidiaries whose
substantial contributions are essential to the continued growth and success of
the Company's business in order to strengthen their commitment to the Company
and its Subsidiaries, to motivate such officers and employees to faithfully and
diligently perform their assigned responsibilities and to attract and retain
competent and dedicated individuals whose efforts will result in the long-term
growth and profitability of the Company. To accomplish such purposes, the Plan
provides that the Company may grant Incentive Stock Options, Nonqualified Stock
Options, Restricted Stock Awards and Stock Appreciation Rights.

2. Definitions. For purposes of this Plan:

(a) "Agreement" means the written agreement between the Company and an
Optionee or Grantee evidencing the grant of an Option or Award and setting
forth the terms and conditions thereof.

(b) "Award" means a grant of Restricted Stock or Stock Appreciation
Rights, or either or both of them.

(d) "Board" means the Board of Directors of the Company.

(e) "Cause" means the willful failure by an Optionee or Grantee to
perform his duties with the Company or with any Subsidiary or the willful
engaging in conduct which is injurious to the Company or any Subsidiary,
monetarily or otherwise.

(f) "Change in Capitalization" means any increase, reduction, change
or exchange of Shares for a different number or kind of shares or other
securities of the Company by reason of a reclassification,
recapitalization, merger, consolidation, reorganization, issuance of
warrants or rights, stock dividend, stock split or reverse stock split,
combination or exchange of shares, repurchase of shares, change in
corporate structure or otherwise.

(g) "Change in Control" means any of the following events: (i) when
the Company or a Subsidiary acquires actual knowledge that any person (as
such term is used in Sections 13(d) and 14(d)(2) of the Exchange Act),
other than an affiliate of the Company or a Subsidiary or an employee
benefit plan established or maintained by the Company, a Subsidiary or any
of their respective affiliates, is or becomes the beneficial owner (as
defined in Rule 13d-3 of the Exchange Act) directly or indirectly, of
securities of the Company representing more than twenty-five percent (25%)
of the combined voting power of the Company's then outstanding securities
(a "Control Person"), (ii) upon the first purchase of the Company's common
stock pursuant to a tender or exchange offer (other than a tender or
exchange offer made by the Company, a Subsidiary or an employee benefit
plan established or maintained by the Company, a Subsidiary or any of their
respective affiliates), (iii) upon the approval by the Company's
shareholders of (A) a merger or consolidation of the Company with or into
another corporation (other than a merger or consolidation which is approved
by at least two-thirds of the Continuing Directors (as hereinafter defined)
or the definitive agreement for which provides that at least two-thirds of
the directors of the surviving or resulting corporation immediately after
the transaction are Continuing Directors (in either case, a "Non-Control
Transaction")), (B) a sale or disposition of all or substantially all of
the Company's assets or (C) a plan of liquidation or dissolution of the
Company, (iv) if during any period of two (2) consecutive years,
individuals who at the beginning of such period constitute the Board (the
"Continuing Directors") cease for any reason to constitute at least
two-thirds thereof or, following a Non-Control Transaction, two-thirds of
the board of directors of the surviving or resulting corporation; provided
that any individual whose election or nomination for election as a member
of the Board (or, following a Non-Control Transaction, the board

1
<PAGE>

of directors of the surviving or resulting corporation) was approved by a
vote of at least two-thirds of the Continuing Directors then in office
shall be considered a Continuing Director, or (v) upon a sale of (A) common
stock of the Bank if after such sale any person (as such term is used in
Section 13(d) and 14(d)(2) of the Exchange Act) other than the Company, an
employee benefit plan established or maintained by the Company or a
Subsidiary, or an affiliate of the Company or a Subsidiary, owns a majority
of the Bank's common stock or (B) all or substantially all of the Bank's
assets (other than in the ordinary course of business). No person shall be
considered a Control Person for purposes of clause (i) above if (A) such
person is or becomes the beneficial owner, directly or indirectly, of more
than ten percent (10%) but less than twenty-five percent (25%) of the
combined voting power of the Company's then outstanding securities if the
acquisition of all voting securities in excess of ten percent (10%) was
approved in advance by a majority of the Continuing Directors then in
office or (B) such person acquires in excess of ten percent (10%) of the
combined voting power of the Company's then outstanding voting securities
in violation of law and by order of a court of competent jurisdiction,
settlement or otherwise, disposes or is required to dispose of all
securities acquired in violation of law.

(h) "Code" means the Internal Revenue Code of 1986, as amended.

(i) "Committee" means a committee consisting solely of two (2) or more
directors who are Non-Employee Directors (as defined in Rule 16b-3 of the
Exchange Act as it may be amended from time to time) of the Company and
outside directors as defined pursuant to Section 162(m) of the Code (as it
may be amended from time to time) appointed by the Board to administer the
Plan and to perform the functions set forth herein. Directors appointed by
the Board to the Committee shall have the authority to act notwithstanding
the failure to be so qualified.

(j) "Company" means Valley National Bancorp, a New Jersey corporation.

(k) "Disability" means the condition which results when an individual
has become permanently and totally disabled within the meaning of Section
105(d)(4) of the Code.

(l) "Eligible Employee" means any officer or other key employee of the
Company or a Subsidiary designated by the Committee as eligible to receive
Options or Awards subject to the conditions set forth herein.

(m) "Escrow Agent" means the escrow agent under the Escrow Agreement,
designated by the Committee.

(n) "Escrow Agreement" means an agreement between the Company, the
Escrow Agent and a Grantee, in the form specified by the Committee, under
which shares of Restricted Stock awarded pursuant hereto shall be held by
the Escrow Agent until either (a) the restrictions relating to such shares
expire and the shares are delivered to the Grantee or (b) the Company
reacquires the shares pursuant hereto and the shares are delivered to the
Company.

(o) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

(p) "Fair Market Value" means the fair market value of the Shares as
determined by the Committee in its sole discretion; provided, however, that
(A) if the Shares are admitted to quotation on the National Association of
Securities Dealers Automated Quotation System ("NASDAQ") or other
comparable quotation system and have been designated as a National Market
System ("NMS") security, Fair Market Value on any date shall be the last
sale price reported for the Shares on such system on such date or on the
last day preceding such date on which a sale was reported, (B) if the
Shares are admitted to quotation on NASDAQ and have not been designated a
NMS security, Fair Market Value on any date shall be the average of the
highest bid and lowest asked prices of the Shares on such system on such
date, or (C) if the Shares are admitted to trading on a national securities
exchange, Fair Market Value on any date shall be the last sale price
reported for the Shares on such exchange on such date or on the last date
preceding such date on which a sale was reported.

(q) "Grantee" means a person to whom an Award has been granted under
the Plan.

2
<PAGE>

(r) "Incentive Stock Option" means an Option within the meaning of
Section 422 of the Code.

(s) "Nonqualified Stock Option" means an Option which is not an
Incentive Stock Option.

(t) "Option" means an Incentive Stock Option, a Nonqualified Stock
Option, or either or both of them.

(u) "Optionee" means a person to whom an Option has been granted under
the Plan.

(v) "Parent" means any corporation in an unbroken chain of
corporations ending with the Company, if each of the corporations other
than the Company owns stock possessing 50% or more of the total combined
voting power of all classes of stock of one of the other corporations in
such chain.

(w) "Plan" means the Valley National Bancorp 1999 Long-Term Stock
Incentive Plan as set forth in this instrument and as it may be amended
from time to time.

(x) "Restricted Stock" means Shares issued or transferred to an
Eligible Employee which are subject to restrictions as provided in Section
8 hereof.

(aa) "Retirement" means the retirement from active employment by the
Company of an employee or officer but only if such person meets all of the
following requirements: (i) he has a minimum combined total of years of
service and age equal to eighty (80), (ii) he is age sixty-two (62) or
older, and (iii) he provides six (6) months prior written notice to the
Company of the retirement. An employee or officer who retires but fails to
meet such conditions shall not be deemed to be within the definition of
"Retirement" for any purpose under this Plan or any Award or Option granted
thereunder.

(ab) "Shares" means the common stock, no par value, of the Company
(including any new, additional or different stock or securities resulting
from a Change in Capitalization).

(ac) "Stock Appreciation Right" means a right to receive all or some
portion of the increase in the value of shares of Common Stock as provided
in Section 7 hereof.

(ad) "Subsidiary" means any corporation in an unbroken chain of
corporations, beginning with the Company, if each of the corporations other
than the last corporation in the unbroken chain owns stock possessing 50%
or more of the total combined voting power of all classes of stock in one
of the other corporations in such chain.

(ae) "Successor Corporation" means a corporation, or a parent or
subsidiary thereof, which issues or assumes a stock option in a transaction
to which Section 425(a) of the Code applies.

(af) "Ten-Percent Shareholder" means an eligible Employee, who, at the
time an Incentive Stock Option is to be granted to him, owns (within the
meaning of Section 422(b)(6) of the Code) stock possessing more than ten
percent (10%) of the total combined voting power of all classes of stock of
the Company, a Parent or a Subsidiary within the meaning of Section
422(b)(6) of the Code.

3
<PAGE>

3. Administration.

(a) The Plan shall be administered by the Committee which shall hold
meetings at such times as may be necessary for the proper administration of the
Plan. The Committee shall keep minutes of its meetings. A majority of the
Committee shall constitute a quorum and a majority of a quorum may authorize any
action. Each member of the Committee shall be a Non-Employee Director (as
defined in Rule 16b-3 of the Exchange Act as it may be amended from time to
time) and an outside director as defined pursuant to Section 162(m) of the Code
as it may be amended from time to time. No failure to be so qualified shall
invalidate any Option or Award or any action or inaction under the Plan. No
member of the Committee shall be personally liable for any action, determination
or interpretation made in good faith with respect to the Plan, the Options or
the Awards, and all members of the Committee shall be fully indemnified by the
Company with respect to any such action, determination or interpretation.

Subject to the express terms and conditions set forth herein, the Committee
shall have the power from time to time:

(1) to determine those Eligible Employees to whom Options shall be
granted under the Plan and the number of Incentive Stock Options and/or
Nonqualified Options to be granted to each eligible Employee and to
prescribe the terms and conditions (which need not be identical) of each
Option, including the purchase price per share of each Option;

(2) to select those Eligible Employees to whom Awards shall be granted
under the Plan and to determine the number of shares of Restricted Stock
and/or Stock Appreciation Rights to be granted pursuant to each Award, the
terms and conditions of each Award, including the restrictions or
performance criteria relating to such shares or rights, the purchase price
per share, if any, of Restricted Stock and whether Stock Appreciation
Rights will be granted alone or in conjunction with an Option;

(3) to construe and interpret the Plan and the Options and Awards
granted thereunder and to establish, amend and revoke rules and regulations
for the administration of the Plan, including, but not limited to,
correcting any defect or supplying any omission, or reconciling any
inconsistency in the Plan or in any Agreement, in the manner and to the
extent it shall deem necessary or advisable to make the Plan fully
effective, and all decisions and determinations by the Committee in the
exercise of this power shall be final and binding upon the Company or a
Subsidiary, the Optionees and the Grantees, as the case may be;

(4) to determine the duration and purposes for leaves of absence which
may be granted to an Optionee or Grantee without constituting a termination
of employment or service for purposes of the Plan; and

(5) generally, to exercise such powers and to perform such acts as are
deemed necessary or advisable to promote the best interests of the Company
with respect to the Plan.

4. Stock Subject to Plan.

(a) The maximum number of Shares that may be issued or transferred pursuant
to all Options and Awards under this Plan is 2,500,000 of which not more than
250,000 Shares may be issued or transferred pursuant to Options and/or Awards to
any one Eligible Employee. Subject to the foregoing aggregate limitations, the
maximum number of Shares (i) that may be issued or transferred pursuant to
Options or Awards for Incentive Stock Options, Non-Qualified Stock Options and
Stock Appreciation Rights shall be 2,000,000 and (ii) that may be issued or
transferred pursuant to Awards of Restricted Stock shall be 500,000. In each
case, upon a Change in Capitalization after the adoption of this Plan by the
Board on January 19, 1999, the Shares shall be adjusted to the number and kind
of Shares of stock or other securities existing after such Change in
Capitalization.

The number of Shares set forth herein includes Shares awarded pursuant to
all Options and Awards issued or transferred under this Plan prior to the date
of the amendment to this section and the number of Shares takes into account all
Changes in Capitalization prior to January 18, 1999.

4
<PAGE>

(b) Whenever any outstanding Option or portion thereof expires, is
cancelled or is otherwise terminated (other than by exercise of the Option or
any related Stock Appreciation Right), the shares of Common Stock allocable to
the unexercised portion of such Option may again be the subject of Options and
Awards hereunder.

(c) Whenever any Shares subject to an Award or Option are resold to the
Company, or are forfeited for any reason pursuant to the terms of the Plan, such
Shares may again be the subject of Options and Awards hereunder.

5. Eligibility. Subject to the provisions of the Plan, the Committee shall
have full and final authority to select those Eligible Employees who will
receive Options and/or Awards but no person shall receive any Options or Awards
unless he is an employee of the Company or a Subsidiary at the time the Option
or Award is granted.

6. Stock Options. The Committee may grant Options in accordance with the
Plan, the terms and conditions of which shall be set forth in an Agreement. Each
Option and Option Agreement shall be subject to the following conditions:

(a) Purchase Price. The purchase price or the manner in which the
purchase price is to be determined for Shares under each Option shall be
set forth in the Agreement, provided that the purchase price per Share
under each Incentive Stock Option shall not be less than 100% of the Fair
Market Value of a Share at the time the Option is granted (110% in the case
of an Incentive Stock Option granted to a Ten-Percent Shareholder) and
under each Nonqualified Stock Option shall not be less than 80% of the Fair
Market Value of a Share at the time the Option is granted.

(b) Duration. Options granted hereunder shall be for such term as the
Committee shall determine, provided that (i) no Incentive Stock Option
shall be exercisable after the expiration of ten (10) years from the date
it is granted (five (5) years in the case of an Incentive Stock Option
granted to a Ten-Percent Shareholder) and (ii) no Nonqualified Stock Option
shall be exercisable after the expiration of ten (10) years and one (1) day
from the date it is granted. The Committee may, subsequent to the granting
of any Option, extend the term thereof but in no event shall the term as so
extended exceed the maximum term provided for in the preceding sentence.

(c) Non-Transferability. No Option granted hereunder shall be
transferable by the Optionee to whom granted otherwise than by will or the
laws of descent and distribution, and an Option may be exercised during the
lifetime of such Optionee only by the Optionee or his guardian or legal
representative. The terms of such Option shall be binding upon the
beneficiaries, executors, administrators, heirs and successors of the
Optionee.

(d) Stock Options; Vesting. Subject to Section 6(h) hereof, each
Option shall be exercisable in such installments (which need not be equal)
and at such times as may be designated by the Committee and set forth in
the Option Agreement. Unless otherwise provided in the Agreement, to the
extent not exercised, installments shall accumulate and be exercisable, in
whole or in part, at any time after becoming exercisable, but not later
than the date the Option expires. Upon the death, Disability or Retirement
of an Optionee, all Options shall become immediately exercisable.
Notwithstanding the foregoing, the Committee may accelerate the
exercisability of any Option or portion thereof at any time.

(e) Method of Exercise. The exercise of an Option shall be made only
by a written notice delivered in person or by mail to the Secretary of the
Company at the Company's principal executive office, specifying the number
of Shares to be purchased and accompanied by payment therefor and otherwise
in accordance with the Agreement pursuant to which the Option was granted.
The purchase price for any shares purchased pursuant to the exercise of an
Option shall be paid in full upon such exercise in cash, by check, or, at
the discretion of the Committee and upon such terms and conditions as the
Committee shall approve, by transferring Shares to the Company. Any Shares
transferred to the Company as payment of the purchase price under an Option
shall be valued at their Fair Market Value on the day preceding the date of
exercise of such Option. If requested by the Committee, the Optionee shall
deliver the Agreement evidencing the Option and the Agreement evidencing
any related Stock Appreciation Right to the

5
<PAGE>

Secretary of the Company who shall endorse thereon a notation of such
exercise and return such Agreement to the Optionee. Not less than 100
Shares may be purchased at any time upon the exercise of an Option unless
the number of Shares so purchased constitutes the total number of Shares
then purchasable under the Option.

(f) Rights of Optionees. No Optionee shall be deemed for any purpose
to be the owner of any Shares subject to any Option unless and until (i)
the Option shall have been exercised pursuant to the terms thereof, (ii)
the Company shall have issued and delivered the Shares to the Optionee, and
(iii) the Optionee's name shall have been entered as a shareholder of
record on the books of the Company. Thereupon, the Optionee shall have full
voting, dividend and other ownership rights with respect to such Shares.

(g) Termination of Employment. In the event that an Optionee ceases to
be employed by the Company or any Subsidiary, any outstanding Options held
by such Optionee shall, unless the Option Agreement evidencing such Option
provides otherwise, terminate as follows:

(i) If the Optionee's termination of employment is due to his
death or Disability, the Option shall be exercisable for a period of
one (1) year following such termination of employment, and shall
thereafter terminate;

(ii) If the Optionee's termination of employment is by the
Company or a Subsidiary for Cause or is by the Optionee (other than
due to the Optionee's Retirement), the Option shall terminate on the
date of the Optionee's termination of employment;

(iii) If the termination of employment is due to the Optionee's
Retirement, the Option shall be exercisable (to the extent exercisable
at the time of the Optionee's termination of employment due to
retirement) for a period of 18 months following such termination of
employment, and shall thereafter terminate. (An Optionee who exercises
his or her Options more than 90 days after the termination of
employment due to Retirement shall acknowledge that the Options so
exercised will not be Incentive Stock Options.); and

(iv) If the Optionee's termination of employment is for any other
reason (including an Optionee's ceasing to be employed by a Subsidiary
as a result of the sale of such Subsidiary or an interest in such
Subsidiary), the Option (to the extent exercisable at the time of the
Optionee's termination of employment) shall be exercisable for a
period of ninety (90) days following such termination of employment,
and shall thereafter terminate.

Notwithstanding the foregoing, the Committee may provide, either at the
time an Option is granted or thereafter, that the Option may be exercised after
the periods provided for in this Section 6(g), but in no event beyond the term
of the Option.

(h) Effect of Change in Control. In the event of a Change in Control,
all Options outstanding on the date of such Change in Control shall become
immediately and fully exercisable.

(i) Substitution and Modification. Subject to the terms of the Plan,
the Committee may modify outstanding Options or accept the surrender of
outstanding Options (to the extent not exercised) and grant new Options in
substitution for them. Notwithstanding the foregoing, no modification of an
Option shall alter or impair any rights or obligations under the Option
without the Optionee's consent, except as provided for in this Plan or the
Agreement.

7. Stock Appreciation Rights. The Committee may, in its discretion, either
alone or in connection with the grant of an Option, grant Stock Appreciation
Rights in accordance with the Plan, the terms and conditions of which shall be
set forth in an Agreement. If granted in connection with an Option, a Stock
Appreciation Right shall cover the same shares covered by the Option (or such
lesser number of shares as the Committee may determine) and shall, except as
provided in this Section 7, be subject to the same terms and conditions as the
related Option.

(a) Time of Grant. A Stock Appreciation Right may be granted:

6
<PAGE>

(i) at any time if unrelated to an Option; or

(ii) if related to an Option, either at the time of grant, or at any
time thereafter during the term of the Option.

(b) Stock Appreciation Rights Related to an Option.

(i) Payment. A Stock Appreciation Right granted in connection with an
Option shall entitle the holder thereof, upon exercise of the Stock Appreciation
Right or any portion thereof, to receive payment of an amount computed pursuant
to Section 7(b)(iii).

(ii) Exercise. Subject to Section 7(f), a Stock Appreciation Right granted
in connection with an Option shall be exercisable at such time or times and only
to the extent that the related Option is exercisable, and will not be
transferable except to the extent the related Option may be transferable. A
Stock Appreciation Right granted in connection with an Incentive Stock Option
shall be exercisable only if the Fair Market Value of a Share on the date of
exercise exceeds the purchase price specified in the related Incentive Stock
Option.

(iii) Amount Payable. Except as otherwise provided in Section 7(g), upon
the exercise of Stock Appreciation Right related to an Option, the Grantee shall
be entitled to receive an amount determined by multiplying (A) the excess of the
Fair Market Value of a Share on the date of exercise of such Stock Appreciation
Right over the per Share purchase price under the related Option, by (B) the
number of Shares as to which such Stock Appreciation Right is being exercised.
Notwithstanding the foregoing, the Committee may limit in any manner the amount
payable with respect to any Stock Appreciation Right by including such a limit
in the Agreement evidencing the Stock Appreciation Right at the time it is
granted.

(iv) Treatment of Related Options and Stock Appreciation Rights Upon
Exercise. Except as provided in Section 7(b)(v), (A) upon the exercise of a
Stock Appreciation Right granted in connection with an Option, the Option shall
be cancelled to the extent of the number of Shares as to which the Stock
Appreciation Right is exercised and (B) upon the exercise of an Option granted
in connection with a Stock Appreciation Right or the surrender of such Option
pursuant to Section 6(h), the Stock Appreciation Right shall be cancelled to the
extent of the number of Shares as to which the Option is exercised or
surrendered.

(v) Simultaneous Exercise of Stock Appreciation Right and Option. The
Committee may provide, either at the time a Stock Appreciation Right is granted
in connection with a Nonqualified Stock Option or thereafter during the term of
the Stock Appreciation Right, that, subject to Section 7(f), upon exercise of
such Option or the surrender of the Option pursuant to Section 6(h), the Stock
Appreciation Right shall automatically be deemed to be exercised to the extent
of the number of Shares as to which the Option is exercised or surrendered. In
such event, the Grantee shall be entitled to receive the amount described in
Section 7(b)(iii) or 7(g) hereof, as the case may be (or some percentage of such
amount if so provided in the Agreement evidencing the Stock Appreciation Right),
in addition to the Shares acquired or cash received pursuant to the exercise or
surrender of the Option. If a Stock Appreciation Right Agreement contains an
automatic exercise provision described in this Section 7(b)(v) and the Option or
any portion thereof to which it relates is exercised within six (6) months from
the date the Stock Appreciation Right is granted, such automatic exercise
provision shall not be effective with respect to that exercise of the Option.
The inclusion in an Agreement evidencing a Stock Appreciation Right of a
provision described in this Section 7(b)(v) may be in addition to and not in
lieu of the right to exercise the Stock Appreciation Right as otherwise provided
herein and in the Agreement.

(c) Stock Appreciation Rights Unrelated to an Option. The Committee may
grant to Eligible Employees Stock Appreciation Rights unrelated to Options.
Stock Appreciation Rights unrelated to Options shall contain such terms and
conditions as to exercisability, vesting and duration as the Committee shall
determine, but in no event shall they have a term of greater than ten (10)
years. Upon the death, Disability or Retirement of a Grantee, all Stock
Appreciation Rights shall become immediately exercisable. Upon the death or
Disability of a Grantee, the Stock Appreciation Rights held by that Grantee
shall be exercisable for a period of one (1) year following such termination of

7
<PAGE>

employment, and shall thereafter terminate. Upon the Retirement of a Grantee,
the Stock Appreciation Rights held by that Grantee shall be exercisable for a
period of ninety (90) days following such termination of employment, and shall
thereafter terminate. Except as otherwise provided in Section 7(g), the amount
payable upon exercise of such Stock Appreciation Rights shall be determined in
accordance with Section 7(b)(iii), except that "Fair Market Value of a Share on
the date of the grant of the Stock Appreciation Right" shall be substituted for
"purchase price under the related Option."

(d) Method of Exercise. Stock Appreciation Rights shall be exercised by a
Grantee only by a written notice delivered in person or by mail to the Secretary
of the Company at the Company's principal executive office, specifying the
number of Shares with respect to which the Stock Appreciation Right is being
exercised. If requested by the Committee, the Grantee shall deliver the
Agreement evidencing the Stock Appreciation Right being exercised and the
Agreement evidencing any related Option to the Secretary of the Company who
shall endorse thereon a notation of such exercise and return such Agreements to
the Grantee.

(e) Form of Payment. Payment of the amount determined under Sections
7(b)(iii) or 7(c), may be made solely in whole shares of Common Stock in a
number determined at their Fair Market Value on the date of exercise of the
Stock Appreciation Right or, alternatively, at the sole discretion of the
Committee, solely in cash, or in a combination of cash and Shares as the
Committee deems advisable. In the event that a Stock Appreciation Right is
exercised within the sixty-day period following a Change in Control, any amount
payable shall be solely in cash. If the Committee decides to make full payment
in Shares, and the amount payable results in a fractional Share, payment for the
fractional Share will be made in cash. Notwithstanding the foregoing, no payment
in the form of cash may be made upon the exercise of a Stock Appreciation Right
pursuant to Section 7(b)(iii) or 7(c) to an officer of the Company or a
Subsidiary who is subject to Section 16(b) of the Exchange Act, unless the
exercise of such Stock Appreciation Right is made during the period beginning on
the third business day and ending on the twelfth business day following the date
of release for publication of the Company's quarterly or annual statements of
earnings.

(f) Restrictions. No Stock Appreciation Right may be exercised before the
date six (6) months after the date it is granted, except in the event that the
death or Disability of the Grantee occurs before the expiration of the six-month
period.

(g) Effect of Change in Control. In the event of a Change in Control,
subject to Section 7(f), all Stock Appreciation Rights shall become immediately
and fully exercisable.

8. Restricted Stock. The Committee may grant Awards of Restricted Stock
which shall be evidenced by an Agreement between the Company and the Grantee.
Each Agreement shall contain such restrictions, terms and conditions as the
Committee may require and (without limiting the generality of the foregoing)
such Agreements may require that an appropriate legend be placed on Share
certificates. Awards of Restricted Stock shall be subject to the following terms
and provisions:

(a) Rights of Grantee.

(i) Shares of Restricted Stock granted pursuant to an Award
hereunder shall be issued in the name of the Grantee as soon as
reasonably practicable after the Award is granted and the purchase
price, if any, is paid by the Grantee, provided that the Grantee has
executed an Agreement evidencing the Award, an Escrow Agreement,
appropriate blank stock powers and any other documents which the
Committee, in its absolute discretion, may require as a condition to
the issuance of such Shares. If a Grantee shall fail to execute the
Agreement evidencing a Restricted Stock Award, an Escrow Agreement or
appropriate blank stock powers or shall fail to pay the purchase
price, if any, for the Restricted Stock, the Award shall be null and
void. Shares issued in connection with a Restricted Stock Award,
together with the stock powers, shall be deposited with the Escrow
Agent. Except as restricted by the terms of the Agreement, upon the
delivery of the Shares to the Escrow Agent, the Grantee shall have all
of the rights of a shareholder with respect to such Shares, including
the right to vote the shares and to receive, subject to Section 8(d),
all dividends or other distributions paid or made with respect to the
Shares.

8
<PAGE>

(ii) If a Grantee receives rights or warrants with respect to any
Shares which were awarded to him as Restricted Stock, such rights or
warrants or any Shares or other securities he acquires by the exercise
of such rights or warrants may be held, exercised, sold or otherwise
disposed of by the Grantee free and clear of the restrictions and
obligations provided by this Plan.

(b) Non-Transferability. Until any restrictions upon the Shares of
Restricted Stock awarded to a Grantee shall have lapsed in the manner set
forth in Section 8(c), such Shares shall not be sold, transferred or
otherwise disposed of and shall not be pledged or otherwise hypothecated,
nor shall they be delivered to the Grantee. Upon the termination of
employment of the Grantee, all of such Shares with respect to which
restrictions have not lapsed shall be resold by the Grantee to the Company
at the same price paid by the Grantee for such Shares or shall be forfeited
and automatically transferred to and reacquired by the Company at no cost
to the Company if no purchase price had been paid for such Shares. The
Committee may also impose such other restrictions and conditions on the
Shares as it deems appropriate.

(i) Restrictions upon Shares of Restricted Stock awarded
hereunder shall lapse at such time or times and on such terms,
conditions and satisfaction of performance criteria as the Committee
may determine; provided, however, that the restrictions upon such
Shares shall lapse only if the Grantee on the date of such lapse is
then and has continuously been an employee of the Company or a
Subsidiary from the date the Award was granted.

(ii) In the event of a Change in Control, all restrictions upon
any Shares of Restricted Stock shall lapse immediately and all such
Shares shall become fully vested in the Grantee thereof.

(iii) In the event of termination of employment as a result of
death, Disability or Retirement of a Grantee, all restrictions upon
Shares of Restricted Stock awarded to such Grantee shall thereupon
immediately lapse. The Committee may also decide at any time in its
absolute discretion and on such terms and conditions as it deems
appropriate, to remove or modify the restrictions upon Shares of
Restricted Stock awarded hereunder.

(d) Treatment of Dividends. At the time of an Award of Shares of
Restricted Stock, the Committee may, in its discretion, determine that the
payment to the Grantee of dividends, or a specified portion thereof,
declared or paid on Shares of Restricted Stock by the Company shall be
deferred until the earlier to occur of (i) the lapsing of the restrictions
imposed upon such Shares, in which case such dividends shall be paid over
to the Grantee, or (ii) the forfeiture of such Shares under Section 8(b)
hereof, in which case such dividends shall be forfeited to the Company, and
such dividends shall be held by the Company for the account of the Grantee
until such time. In the event of such deferral, interest shall be credited
on the amount of such dividends held by the Company for the account of the
Grantee from time to time at such rate per annum as the Committee, in its
discretion, may determine. Payment of deferred dividends, together with
interest accrued thereon as aforesaid, shall be made upon the earlier to
occur of the events specified in (i) and (ii) of the immediately preceding
sentence, in the manner specified therein.

(e) Delivery of Shares. When the restrictions imposed hereunder and in
the Plan expire or have been cancelled with respect to one or more shares
of Restricted Stock, the Company shall notify the Grantee and the Escrow
Agent of same. The Escrow Agent shall then return the certificate covering
the Shares of Restricted Stock to the Company and upon receipt of such
certificate the Company shall deliver to the Grantee (or such Grantee's
legal representative, beneficiary or heir) a certificate for a number of
shares of Common Stock, without any legend or restrictions (except those
required by any federal or state securities laws), equivalent to the number
of Shares of Restricted Stock for which restrictions have been cancelled or
have expired. A new certificate covering Shares of Restricted Stock
previously awarded to the Grantee which remain restricted shall be issued
to the Grantee and held by the Escrow Agent and the Agreement, as it
relates to such shares, shall remain in effect.

9. Loans.

9
<PAGE>

(a) The Company or any Subsidiary may make loans to a Grantee or Optionee
in connection with the purchase of Shares pursuant to an Award or in connection
with the exercise of an Option, subject to the following terms and conditions
and such other terms and conditions not inconsistent with the Plan, including
the rate of interest, if any, as the Committee shall impose from time to time.

(b) No loan made under the Plan shall exceed the sum of (i) the aggregate
purchase price payable pursuant to the Option or Award with respect to which the
loan is made, plus (ii) the amount of the reasonably estimated income taxes
payable by the Optionee or Grantee with respect to the Option or Award. In no
event may any such loan exceed the Fair Market Value, at the date of exercise,
of any such Shares.

(c) No loan shall have an initial term exceeding ten (10) years; provided,
that loans under the Plan shall be renewable at the discretion of the Committee;
and provided, further, that the indebtedness under each loan shall become due
and payable, as the case may be, on a date no later than (i) one (1) year after
termination of the Optionee's or Grantee's employment due to death, retirement
or Disability, or (ii) the date of termination of the Optionee's or Grantee's
employment for any reason other than death, retirement or Disability.

(d) Loans under the Plan may be satisfied by an Optionee or Grantee, as
determined by the Committee, in cash or, with the consent of the Committee, in
whole or in part by the transfer to the Company of Shares whose Fair Market
Value on the date of such payment is equal to the cash amount for which such
Shares are transferred.

(e) A loan shall be secured by a pledge of Shares with a Fair Market Value
of not less than the principal amount of the loan. After partial repayment of a
loan, pledged shares no longer required as security may be released to the
Optionee or Grantee.

(f) Every loan shall meet all applicable laws, regulations and rules of the
Federal Reserve Board and any other governmental agency having jurisdiction.

10. Adjustment Upon Changes in Capitalization.

(a) In the event of a Change in Capitalization, the Committee shall
conclusively determine the appropriate adjustments, if any, to the maximum
number and class of shares of stock with respect to which Options or Awards may
be granted under the Plan, the number and class of shares as to which Options or
Awards have been granted under the Plan, and the purchase price therefor, if
applicable.

(b) Any such adjustment in the Shares or other securities subject to
outstanding Incentive Stock Options (including any adjustments in the purchase
price) shall be made in such manner as not to constitute a modification as
defined by Section 425(h)(3) of the Code and only to the extent otherwise
permitted by Sections 422 and 425 of the Code.

(c) If, by reason of a Change in Capitalization, a Grantee of an Award
shall be entitled to new, additional or different shares of stock or securities
(other than rights or warrants to purchase securities), such new additional or
different shares shall thereupon be subject to all of the conditions,
restrictions and performance criteria which were applicable to the Shares or
units pursuant to the Award prior to such Change in Capitalization.

11. Effect of Certain Transactions. In the event of (i) the liquidation or
dissolution of the Company, (ii) a merger or consolidation in which the Company
is not the surviving corporation or (iii) the sale or disposition of all or
substantially all of the Company's assets, provision shall be made in connection
with such transaction for the assumption of the Plan and the Options or Awards
theretofore granted under the Plan, or the substitution for such Options or
Awards of new options or awards of the Successor Corporation, with appropriate
adjustment as to the number and kind of shares and the purchase price for shares
thereunder.

12. Release of Financial Information. A copy of the Company's annual report
to shareholders shall be delivered to each Optionee and Grantee at the time such
report is distributed to the Company's shareholders. Upon

10
<PAGE>

request the Company shall furnish to each Optionee and Grantee a copy of its
most recent annual report and each quarterly report and current report filed
under the Exchange Act, since the end of the Company's prior fiscal year.

13. Termination and Amendment of the Plan. The Plan shall terminate on the
day preceding the tenth anniversary of its effective date and no Option or Award
may be granted thereafter. The Board may sooner terminate or amend the Plan at
any time, and from time to time; provided, however, that, except as provided in
Sections 10 and 11 hereof, no amendment shall be effective unless approved by
the shareholders of the Company in accordance with applicable law and
regulations at an annual or special meeting held within twelve months before or
after the date of adoption of such amendment, where such amendment will:

(a) increase the number of Shares as to which Options or Awards may be
granted under the Plan; or

(b) change the class of persons eligible to participate in the Plan.

The following amendments shall not require Shareholder approval unless
required by law or regulation to preserve the intended benefits of the Plan to
the Company or the participants:

(a) change the minimum purchase price of Shares pursuant to Options or
Awards as provided herein;

(b) extend the maximum period for granting or exercising Options
provided herein; or

Except as provided in Sections 10 and 11 hereof, rights and obligations
under any Option or Award granted before any amendment of the Plan shall not be
altered or impaired by such amendment, except with the consent of the Optionee
or Grantee, as the case may be.

14. Non-Exclusivity of the Plan. The adoption of the Plan by the Board
shall not be construed as amending, modifying or rescinding any previously
approved incentive arrangement or as creating any limitations on the power of
the Board to adopt such other incentive arrangements as it may deem desirable,
including, without limitation, the granting of stock options otherwise than
under the Plan, and such arrangements may be either applicable generally or only
in specific cases.

15. Limitation of Liability. As illustrative of the limitations of
liability of the Company, but not intended to be exhaustive thereof, nothing in
the Plan shall be construed to;

(a) give any person any right to be granted an Option or Award other
than at the sole discretion of the Committee;

(b) give any person any rights whatsoever with respect to Shares
except as specifically provided in the Plan;

(d) be evidence of any agreement or understanding, expressed or
implied, that the Company will employ any person in any particular position
at any particular rate of compensation or for any particular period of
time.

11
<PAGE>

16. Regulations and Other Approvals; Governing Law.

(a) This Plan and the rights of all persons claiming hereunder shall be
construed and determined in accordance with the laws of the State of New Jersey
without giving effect to the choice of law principles thereof, except to the
extent that such law is preempted by federal law.

(b) The obligation of the Company to sell or deliver Shares with respect to
Options and Awards granted under the Plan shall be subject to all applicable
laws, rules and regulations, including all applicable federal and state
securities laws, and the obtaining of all such approvals by governmental
agencies as may be deemed necessary or appropriate by the Committee.

(c) The Plan is intended to comply with Rule 16b-3 promulgated under the
Exchange Act and Section 162(m) of the Code (each as amended from time to time)
and the Committee shall interpret and administer the provisions of the Plan or
any Agreement in a manner consistent therewith to the extent necessary. Any
provisions inconsistent with such Rule or Section shall be inoperative but shall
not affect the validity of the Plan or any grants thereunder.

(c) Except as otherwise provided in Section 13, the Board may make such
changes as may be necessary or appropriate to comply with the rules and
regulations of any government authority or to obtain for Eligible Employees
granted Incentive Stock Options the tax benefits under the applicable provisions
of the Code and regulations promulgated thereunder.

(d) Each Option and Award is subject to the requirement that, if at any
time the Committee determines, in its absolute discretion, that the listing,
registration or qualification of Shares issuable pursuant to the Plan is
required by any securities exchange or under any state or federal law, or the
consent or approval of any governmental regulatory body is necessary or
desirable as a condition of, or in connection with, the grant of an Option or
the issuance of Shares, no Options shall be granted or payment made or Shares
issued, in whole or in part, unless listing, registration, qualification,
consent or approval has been effected or obtained free of any conditions
unacceptable to the Committee.

(e) In the event that the disposition of Shares acquired pursuant to the
Plan is not covered by a then current registration statement under the
Securities Act of 1933, as amended, and is not otherwise exempt from such
registration, such Shares shall be restricted against transfer to the extent
required by the Securities Act of 1933, as amended, or regulations thereunder,
and the Committee may require any individual receiving Shares pursuant to the
Plan, as a condition precedent to receipt of such Shares (including upon
exercise of an Option), to represent to the Company in writing that the Shares
acquired by such individual are acquired for investment only and not with a view
to distribution.

17. Miscellaneous.

(a) Multiple Agreements. The terms of each Option or Award may differ from
other Options or Awards granted under the Plan at the same time, or at some
other time. The Committee may also grant more than one Option or Award to a
given Eligible Employee during the term of the Plan, either in addition to, or
in substitution for, one or more Options or Awards previously granted to that
Eligible Employee. The grant of multiple Options and/or Awards may be evidenced
by a single Agreement or multiple Agreements, as determined by the Committee.

(b) Withholding of Taxes. The Company shall have the right to deduct from
any distribution of cash to any Optionee or Grantee an amount equal to the
federal, state and local income taxes and other amounts required by law to be
withheld with respect to any Option or Award. Notwithstanding anything to the
contrary contained herein, if an Optionee or Grantee is entitled to receive
Shares upon exercise of an Option or pursuant to an Award, the Company shall
have the right to require such Optionee or Grantee, prior to the delivery of
such Shares, to pay to the Company the amount of any federal, state or local
income taxes and other amounts which the Company is required by law to withhold.
The Agreement evidencing any Incentive Stock Options granted under this Plan
shall provide that if the Optionee makes a disposition, within the meaning of
Section 425(c) of the Code and regulations promulgated thereunder, of any Share
or

12
<PAGE>

Shares issued to him or her pursuant to his or her exercise of the Incentive
Stock Option within the two-year period commencing on the day after the date of
grant of such Option or within the one-year period commencing on the day after
the date of transfer of the Share or Shares to the Optionee pursuant to the
exercise of such Option, he or she shall, within ten (10) days of such
disposition, notify the Company thereof and immediately deliver to the Company
any amount of federal income tax withholding required by law.

(c) Designation of Beneficiary. Each Optionee and Grantee may, with the
consent of the Committee, designate a person or persons to receive in the event
of his/her death, any Option or Award or any amount payable pursuant thereto, to
which he/she would then be entitled. Such designation will be made upon forms
supplied by and delivered to the Company and may be revoked in writing. If an
Optionee fails effectively to designate a beneficiary, then his/her estate will
be deemed to be the beneficiary.

18. Effective Date. The effective date of the Plan shall be the date of its
adoption by the Board, subject only to the approval by the affirmative vote of a
majority of the votes cast at a meeting of shareholders at which a quorum is
present to be held within twelve (12) months of such adoption. No Options or
Awards shall vest hereunder unless such Shareholder approval is obtained.

13
<PAGE>

VALLEY NATIONAL BANCORP

PROXY

FOR THE ANNUAL MEETING OF SHAREHOLDERS

Wednesday, April 7, 1999

SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby appoints ROBERT RACHESKY, ROBERT E. McENTEE and
RICHARD F. TICE and each of them, as Proxy, each with full power of
substitution, to vote all of the stock of VALLEY NATIONAL BANCORP standing in
the undersigned's name at the Annual Meeting of Shareholders of VALLEY NATIONAL
BANCORP, to be held at the Radisson Hotel, 690 Route 46 East, Fairfield, New
Jersey, on Wednesday, April 7, 1999 at 3:00 p.m., and at any adjournment
thereof. The undersigned hereby revokes any and all proxies heretofore given
with respect to such meeting.

This proxy will be voted as specified below. If no choice is specified, the
proxy will be voted FOR the election of the 19 nominees for director listed in
the Proxy Statement and FOR the Valley National Bancorp 1999 Long-Term Stock
Incentive Plan.

Shares, if any, held for your account by the trustee for the dividend
reinvestment plan will be voted in the same manner as you vote the shares in
your name individually.

(see reverse side)

<PAGE>

1. ELECTION OF 19 DIRECTORS

/_/ FOR the nominees listed below (except as marked to the contrary
below):

/_/ FOR ALL nominees except: _______________________________________.
(Instructions: To withhold authority to vote for any individual
nominee(s) write that nominee's name on the above line.)

/_/ WITHHOLD AUTHORITY to vote for all nominees listed below:

Andrew B. Abramson, Pamela Bronander, Joseph Coccia, Jr., Harold P. Cook,
III, Austin C. Drukker, Willard L. Hedden, Graham O. Jones, Walter H.
Jones, III, Gerald Korde, Gerald H. Lipkin, Joleen Martin, Robert E.
McEntee, Sam P. Pinyuh, Robert Rachesky, Barnett Rukin, Peter Southway,
Richard F. Tice, Leonard Vorcheimer, Joseph L. Vozza.

2. THE VALLEY NATIONAL BANCORP 1999 LONG-TERM STOCK INCENTIVE PLAN

/_/ FOR the Valley National Bancorp 1999 Long-Term Stock Incentive Plan.

/_/ AGAINST the Valley National Bancorp 1999 Long-Term Stock Incentive
Plan.

/_/ WITHHOLD AUTHORITY to vote for the Valley National Bancorp 1999
Long-Term Stock Incentive Plan.

3. In their discretion, upon such other matters as may properly come before
the meeting.

Dated: ________________, 1999

___________________________
Signature

(Please sign exactly as your
name appears. When signing
as an executor,
administrator, guardian,
trustee or attorney, please
give your title as such. If
signer is a corporation,
please sign the full
corporate name and then an
authorized officer should
sign his name and print his
name and title below his
signature. If the shares
are held in joint name, all
joint owners should sign.)

PLEASE DATE, SIGN AND
RETURN PROMPTLY