Commercial Businesses Enter 2026 with Momentum but Face Uncertainty
MWN-AI** Summary
Valley National Bank's second annual Middle-Market C&I Survey reveals that commercial businesses are entering 2026 with notable momentum despite facing significant uncertainties. The survey, which gathered insights from 500 middle-market companies, indicates robust financial performance for 2025, with 92% of respondents rating their cash flow as good or very good—up from 79% in the previous year. Additionally, productivity and profitability have seen considerable gains, rising from 85% to 95% and from 79% to 89%, respectively.
However, as businesses look ahead, they grapple with various external and operational pressures. Concerns surrounding inflation and interest rates have heightened, with 57% of respondents indicating difficulties—an increase from 45%. Geopolitical tensions and trade policy worries also grew, affecting 52% of the surveyed businesses.
To maintain their positive trajectory, leaders are urged to focus on core strategies. The survey highlights six key priorities for 2026, including enhancing financial and operational efficiency, customer retention, and adopting technologies like AI and data analytics. Despite high ambitions, execution gaps remain; only 40% of firms reported effective cash-flow management, and challenges persist in budgeting, cost control, and hiring.
Moreover, many businesses overlook critical safeguards, such as fraud protection and leveraging bank advisory relationships, with only 22% using bankers as trusted advisors for financial decisions. As Gino Martocci, President of Commercial Banking at Valley Bank, emphasizes, fostering strong relationships and implementing vigilant risk management strategies are vital for navigating the evolving landscape of 2026. This dual approach—optimizing operational fundamentals while remaining adaptable—will be crucial for middle-market businesses as they strive to sustain their momentum in an uncertain environment.
MWN-AI** Analysis
As we move towards 2026, middle-market Commercial and Industrial (C&I) businesses are entering the year with noteworthy momentum, as highlighted in Valley Bank's recent survey. Respondents have reported remarkable improvements in financial performance, indicating a robust environment for many. Cash flow ratings improved from 79% to an impressive 92%, and profitability rose significantly, reflecting healthy operational efficiency. However, optimism is tempered by persistent external and operational uncertainties, including inflationary pressures, interest rate concerns, and geopolitical tensions.
Moving into 2026, businesses must seize this momentum while maintaining a strategic focus on core priorities. The survey identified key initiatives for the upcoming year, which include operational efficiency, customer loyalty, and the adoption of advanced technologies like AI and data analytics. These are critical areas that can fortify a company's market position and enhance overall resilience.
Despite the positive outlook, significant execution gaps remain. Only 40% of companies reported effective cash flow management, with similar shortfalls in budgeting, cost control, and profit-margin management. This underlines the necessity for businesses to refine their financial processes to sustain growth. Additionally, talent retention poses challenges, with 30% of companies struggling to hire effectively.
The survey also sheds light on the importance of fraud protection and advisory banking relationships, areas that many businesses have underutilized. With 68% of respondents acknowledging the need for stronger fraud measures but only 39% employing fraud mitigation services, there exists an opportunity for improvement.
In conclusion, businesses should adopt a proactive approach, prioritizing operational enhancements and solidifying advisory relationships to navigate uncertainties successfully. By focusing on these areas, companies can sustain their momentum and thrive in a challenging landscape.
**MWN-AI Summary and Analysis is based on asking OpenAI to summarize and analyze this news release.
Valley Bank’s 2 nd Annual Middle-Market C&I Survey Highlights Strong Performance in a Shifting Environment
Valley National Bank, a subsidiary of Valley National Bancorp (NASDAQ: VLY), today released findings from its second annual Middle-Market C&I Survey: Entering 2026 With Momentum. The survey of 500 commercial businesses across Valley’s footprint reveals that middle-market Commercial and Industrial (C&I) businesses reported strong 2025 financial performance but face mounting external and operating pressures heading into the new year. While remaining optimistic about 2026, businesses are adapting to evolving dynamics such as cash?flow timing, cost pressures, and a more uncertain global environment.
Compared to 2025, respondents reported significant gains:
- 92% rate their cash flow as good or very good, up from 79%.
- Productivity rose from 85% to 95%, as more companies reported operating more efficiently across their core functions.
- Profitability climbed from 79% to 89%, reflecting improved financial results across the middle?market segment.
These improvements signal that many businesses are stable and are in solid position to weather any challenges. However, difficulty managing inflation and interest rates rose to 57% (up from 45%), while 52% expressed concerns about geopolitical tensions and trade policies (up from 41%).
“Middle-market businesses help drive the U.S. economy and the positive results in this survey indicate that many are entering 2026 in strong and stable positions,” said Gino Martocci, President of Commercial Banking, Valley Bank. “To maintain this momentum, leaders should focus on the basics, be selective in what they prioritize and those who focus on a few core areas and remain vigilant and adaptable, will achieve greater success in an evolving landscape.”
Successful execution requires focus and the survey respondents identified six priorities that will comprise their core initiatives for 2026:
- Financial and operational efficiency
- Customer retention and loyalty
- Pricing strategy and cost efficiency
- AI and machine learning adoption
- Data analytics and business intelligence
- Pricing strategy and cost efficiencies
While ambition is high, execution gaps remain. Only:
- 40% report effective cash-flow management
- 39% are confident in budgeting and forecasting
- 37% feel effective in cost control
- 36% report strong profit-margin management
- 35% are successfully integrating financial technology
- 30% believe they are optimizing working capital
In addition, 30% say hiring remains difficult and 17% report challenges retaining top employees.
The survey also revealed that only 39% of respondents use fraud mitigation services, despite 68% acknowledging a need for stronger fraud protection. Just 57% included data security among their top priorities.
“Fraud protection is not optional, it is foundational,” said Martocci. “Simple safeguards, real-time alerts, and clearly defined response protocols can dramatically reduce financial loss and business disruption.”
Not leveraging an advisory relationship with a banker is another missed opportunity for businesses. Only 22% of respondents use their banker as a trusted advisor for major financial decisions. A strong relationship can help improve working capital management and provide insight into payment flows and risk exposure.
The survey was conducted in December 2025 with 500 middle-market business financial decision makers. To qualify, respondents had to be responsible for or play a leading role in financial decisions at a U.S. company with annual revenue between $5 million and $249 million.
About Valley
As the principal subsidiary of Valley National Bancorp (NASDAQ: VLY), Valley National Bank is a regional financial institution with approximately $64 billion in assets. Founded in 1927, Valley has more than 200 offices nationwide and serves individuals, families, and businesses across New Jersey, New York, Florida, Alabama, California, and Illinois. Valley delivers a full range of consumer, commercial, and wealth management solutions designed to support everything from homeownership and business growth to long-term financial planning. Big enough to support complex financial needs and small enough to stay deeply connected, Valley is grounded in a relationship-led approach focused on understanding people first. That same relationship-led approach guides Valley’s commitment to community investment and responsible corporate citizenship. To learn more, visit www.valley.com or call the Valley Customer Care Center at 800-522-4100.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260219198777/en/
Pam Golden
(973) 564-8591
pam@glapr.com
FAQ**
What factors contributed to the increase in cash flow ratings among middle-market businesses surveyed by Valley National Bancorp VLY, and how can these insights inform future financial strategies?
Given that only 40% of businesses reported effective cash-flow management, what steps can Valley National Bancorp VLY take to assist its clients in improving their financial operations?
How does Valley National Bancorp VLY plan to address the reported gaps in fraud protection services, considering that 68% of respondents acknowledge the need for stronger security measures?
Considering that only 22% of survey respondents utilize their banker as a trusted advisor, what initiatives could Valley National Bancorp VLY implement to enhance client relationships and advisory services?
**MWN-AI FAQ is based on asking OpenAI questions about Valley National Bancorp (NASDAQ: VLY).
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