Middle-market Commercial and Industrial (C&I) businesses across the U.S. are entering the new year on solid financial footing but are increasingly wary of external economic pressures. Valley National Bank released its second annual survey, Entering 2026 With Momentum, revealing a paradoxical landscape of high internal productivity coupled with rising global uncertainty.
The survey, which polled 500 financial decision-makers at companies with revenues between $5 million and $249 million, shows that while 2025 was a banner year for growth, “execution gaps” in core financial management could pose risks in the coming months.
Compared to 2025, middle-market firms reported significant year-over-year gains in several key health metrics:
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Productivity: Jumped from 85% to 95%.
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Cash flow: 92% rated their cash flow as “good” or “very good,” up from 79%.
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Profitability: Climbed 10 points to 89%.
Despite these internal wins, businesses are struggling to navigate a shifting macro environment. The survey found that 57% of respondents cited difficulty managing inflation and interest rates (up from 45%), while 52% expressed growing concern over geopolitical tensions and trade policies.
“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 at Valley Bank. “To maintain this momentum, leaders should focus on the basics and remain vigilant and adaptable.”
While businesses identified AI adoption and data analytics as top priorities for 2026, many are struggling with fundamental financial controls. Only 40% of respondents reported effective cash-flow management, and just 30% believe they are optimizing their working capital.
Furthermore, a critical security gap was identified:
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68% acknowledge a need for stronger fraud protection.
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Only 39% actually use fraud mitigation services.
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Just 57% included data security among their top strategic priorities.
“Fraud protection is not optional, it is foundational,” Martocci warned, noting that simple safeguards like real-time alerts can dramatically reduce disruption.
The survey highlighted a significant missed opportunity in the banking relationship. Only 22% of middle-market businesses utilize their banker as a “trusted advisor” for major financial decisions. Valley Bank suggests that a stronger advisory relationship can help firms bridge the gap in budgeting, forecasting, and risk exposure as they navigate the complexities of 2026.
