PRESIDENT’S MESSAGE Spring Is a Time To Indulge in a Little Optimism MARK MANGANO President & CEO, WVBankers The naturalist Edwin Way Teale said, “The world’s favorite season is spring. All things seem possible in May.” As we emerge from the harshness of winter, it is human nature to consider the possibilities suggested by the change of season. I believe that this spring, there are good reasons for bankers to reflect on the changes we have seen in the last year and indulge in a little optimism. Bankers face challenges every year, including competition, technology, regulation and human resources. But this spring, we can take heart from significant trends that are creating a more solid foundation from which to meet the challenges. The four major trends contributing to improving banking industry foundations are a stabilizing economy, improving profitability, meaningful regulatory changes and strong voices to help shape future policy. We appear to be emerging from the economic and interest instability resulting from the COVID-19 pandemic and related economic policy responses. A traditional positive yield curve with short-term rates lower than longer-term rates is returning. Since the beginning of 2025, the yield curve as reflected by the U.S. Treasury bond market has seen the spread between one-month and 10-year treasuries grow from eight basis points to 50 basis points. The fed funds rate declined from 4.25% to 3.50% over the same period. Banking industry profitability continues to improve. According to the FDIC, in the third quarter of 2025, the industry-wide ROA was 1.27%. This was a 13-basis point improvement from the prior quarter and an 18-basis point improvement from the prior year. The regulatory environment is broadly and meaningfully improving. The primary federal banking regulators are led by Michelle Bowman, Fed vice chair for supervision; Travis Hill, FDIC chair; and Jonathan Gould, OCC comptroller. These new leaders, both individually and collectively, have expressed the desire to reduce regulatory burdens for community banks, narrow examination focus to addressing potential material financial harm and violations of law, eliminate regulatory pressure to withhold banking services from disfavored groups or individuals, and encourage banking health and competitiveness. Each agency spent 2025 turning good intentions into action. The banking industry has collectively built, sustained and improved associations such as the American Bankers Association and the West Virginia Bankers Association to focus on industry advocacy. The associations are effective in advancing and defending the industry due to four critical elements: banker-driven priorities, talented advocacy professionals, banker political engagement, and commitment to the special and critical roles banks play in supporting our society. In the past year, the industry associations have helped shape the positive regulatory changes and defended against ill-advised measures to undermine the banking industry’s role in society and the economy. Every morning, bankers around our state and nation show up to meet the challenges in providing critically important and often underappreciated service to their communities and our country. It is encouraging that the economic environment is improving, regulators are returning to a focus on fostering bank success, and the industry is speaking forcefully and intelligently to policymakers on the issues critical to future success. It is refreshing to stop and smell the flowers and indulge in a little optimism. 4 WEST VIRGINIA BANKER
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