FORM OF TAX OPINION OF PITNEY, HARDIN, KIPP & SZUCH LLP
______, 2000
Valley National Bancorp
1455 Valley Road
Wayne, New Jersey 07474-0558
Merchants New York Bancorp, Inc.
275 Madison Avenue
New York, New York 10016
Dear Ladies and Gentlemen:
We have acted as counsel for Valley National Bancorp
("Valley"), a New Jersey corporation and registered bank holding company, in
connection with the planned merger (the "Merger") of Merchants New York Bancorp,
Inc. ("Merchants"), a Delaware corporation and registered bank holding company,
with and into Valley, pursuant to that certain Agreement and Plan of Merger (the
"Agreement"), dated as of September 5, 2000, by and among Valley, Valley
National Bank, a national banking association ("VNB"), Merchants, and The
Merchants Bank of New York, a New York-chartered commercial bank (the "Bank").
We have assumed with your consent that:
(a) the Merger will be effected in accordance with the
Agreement, and
(b) the representations contained in the letters of
representation from Valley and Merchants to us dated October ___, 2000 will be
true at the effective time of the merger.
On the basis of the foregoing, and our consideration of such
other matters of fact and law as we have deemed necessary or appropriate, it is
our opinion, under presently applicable federal income tax law, that the Merger
will constitute a reorganization under Section 368 of the Internal Revenue Code
of 1986, as amended (the "Code"), and that:
(i) no gain or loss will be recognized for federal income tax
purposes by Valley or Merchants in connection with the Merger;
(ii) no gain or loss will be recognized for federal income tax
purposes by Merchants stockholders upon the exchange in the Merger of shares of
Merchants common stock solely for Valley common stock (except with respect to
cash received in lieu of a fractional share interest in Valley common stock);
(iii) the basis of Valley common stock received in the Merger
by Merchants stockholders (including the basis of any fractional share interest
in stock) will be the same as the basis of the shares of Merchants common stock
surrendered in exchange therefor;
(iv) the holding period of Valley common stock received in the
Merger by Merchants stockholders (including the holding period of any fractional
share interest in stock) will include the holding period during which the shares
of Merchants common stock surrendered in exchange therefor were held by the
Merchants stockholder, provided such shares of Merchants common stock were held
as capital assets; and
(v) cash received by a holder of Merchants common stock in
lieu of a fractional share interest in Valley common stock will be treated as
received in exchange for such fractional share interest and, provided the
fractional share would have constituted a capital asset in the hands of such
holder, the holder should in general recognize capital gain or loss in an amount
equal to the difference between the amount of cash received and the portion of
the adjusted tax basis in the Merchants common stock allocable to the fractional
share interest.
The tax consequences described above may not be applicable to
Merchants stockholders that acquired the stock of Merchants pursuant to the
exercise of an employee stock option or right or otherwise as compensation, that
hold Merchants common stock as part of a "straddle" or "conversion transaction"
or that are insurance companies, securities dealers, financial institutions or
foreign persons.
We hereby consent to the reference to us under the heading
"THE PROPOSED MERGER -- Federal Income Tax Consequences" in the Joint Proxy
Statement-Prospectus pertaining to the Merger and to the filing of this opinion
as an exhibit to the related Registration Statement on Form S-4 filed with the
Securities and Exchange Commission. In giving this consent, we do not hereby
admit that we are within the category of persons whose consent is required under
Section 7 of the Securities Act of 1933, as amended, or the rules and
regulations of the Securities and Exchange Commission thereunder.
Very truly yours,
