President's Message

Spring 2023

To Our Valued Customers,

After 2 years of COVID dominating our lives and businesses, 2022 was the beginning of what post-COVID life would look like. The pandemic brought about a unique set of circumstances for banking and we saw those underpinnings unwind, some with breakneck speed. The historically low interest rate environment in which we lived for almost a decade faded quickly as The Federal Reserve began historic rate increases. In both speed and size, rates rose almost as fast as anytime in the last few decades. This quickly changed the banking landscape, making deposits both more costly and more desirable, loan rates increasing dramatically, and the balance sheets for all banks changing quickly with each interest rate increase. 

Our purchase of the Newburgh branch from Empire State Bank was timely with the additional accounts coming at a time when deposit valuations were increasing. The additional deposits helped the bank weather the rate storm, but we quickly adjusted deposit rates to ensure we were competitive in the larger market. It was a seamless integration, a credit to our team, and we are excited about the prospects in our new market. 

We performed well from an earnings standpoint in 2022 but we expect a much more difficult landscape in 2023. Interest rates and margin compression will continue to erode at the banks earning ability, but it should be noted that this is not the first time WVFSL has been through such an environment. We have been serving our communities for over 100 years, through some difficult times, and we will continue to do so well into the future. 

Something we do not talk about a lot is the fact that we are a mutual savings and loan. Being a mutual means that we are owned by our depositors. We are not subject to the pressures of stock owned banks like SVB and Signature. Our owners are our customers, so we do not have the added worry of maximizing shareholder value. Our goals are perfectly aligned with our depositors and customers because they are the true owners of the bank. We are strictly committed to our customers, employees, and communities in ways that a stock bank, who is required to maximize shareholder value, could never be.

Sincerely,

Michael J. Horodyski

President and CEO