Pittsburgh Business Times’ Post

The last time American finance was operating in a high-inflation, high-interest rate environment, like the current economy, was nearly 40 years ago. That means most current executives, who came up in the era of easy money, are unfamiliar with the complexities of running a bank under today’s conditions. As the top brass at financial institutions start to accept that interest rates will likely be higher for longer, they’re scrambling to find leaders with the skills to succeed in such an unpredictable environment. Some CEOs are deciding that they need to make drastic, expensive and often unpopular institutional changes to help them keep up. Read the full story at https://lnkd.in/eGpj29zs #bankingindustry #markets #future

Bank of America Corp. Chief Executive Officer Brian Moynihan said the firm reversed its prediction for a recession in coming months because of strength in the jobs market and robust consumer spending. It’s our job to ensure you are ready for whatever comes, having a CEO that’s always prepared helps us do that. Now is a perfect time to sit with your advisors and talk year end projects. How does your bank help you prepare? #callyourbanker #plansforthefuture #partner #businessadvisor

My takeaway from this article and most others regarding the current state of the economy and what is to come is that... no one really has a clue of what is to come. They might have strong and believable opinions, but no one knows. And how could they? There are so many different factors at play, it is hard to fathom. Here are two quotes from this article that stand out: - “This may be the most dangerous time the world has seen in decades,” JPMorgan Chief Executive Officer Jamie Dimon said. - “The U.S. keeps surprising us with its resilience, so I think it’s hard to call,” Citigroup Chief Financial Officer Mark Mason said. “I do think we’re likely to land things in a softer way than we thought.” Seems unlikely that both of these statements can be true. Hope for the best, prepare for the worst. #economy #businessbanking #business

The last time American finance was operating in a high-inflation, high-interest rate environment, like the current economy, was nearly 40 years ago. That means most current executives, who came up in the era of easy money, are unfamiliar with the complexities of running a bank under today’s conditions. As the top brass at financial institutions start to accept that interest rates will likely be higher for longer, they’re scrambling to find leaders with the skills to succeed in such an unpredictable environment. Some CEOs are deciding that they need to make drastic, expensive and often unpopular institutional changes to help them keep up. That means it's time to restructure. Citigroup CEO Jane Fraser announced a sweeping restructuring effort last week meant to rearrange the bank’s leadership. Wells Fargo, Truist, Barclays and Goldman Sachs have recently made similar efforts. I spoke with David Schiff at West Monroe about what comes next. https://lnkd.in/emCYvS4p #wallstreet #banking #leadershipdevelopment

JPMorgan Chase CEO Jamie Dimon talked about the recent banking crisis, his biggest concerns for the economy, potential recession, and access to capital, in an interview with Louisville Business First. Asked about whether the recent banking crisis has been contained, Dimon stated: "I'd say it's over, but if in the future you have a recession, that'll hurt banks a little bit. And if rates continue to go up in a recession …you could see other institutions … see more damage done if rates go up." Dimon noted that there needs to be new regulation to prevent similar situations in the future, adding, however, that "regulations should always be recalibrated. They should always be rethought, not just always adding more, and more and more." Among his biggest concerns for the economy, Dimon singled out quantitative tightening inflation, Russia, and America and China's relationship. "I think those headwinds down the road have a good chance of pushing us into recession," Dimon stated. He noted that we should not be afraid of a mild recession, adding that "there could be more severe consequences to this war and the American relationship (with China) and what it can do to trade." On whether small businesses should be worried about access to capital, Dimon said: "That reduced lending will probably affect small business and middle market a lot more than large corporations and could affect regional banks." #jamiedimon #economicoutlook  

Interesting take on the current financial environment... As the top brass at financial institutions start to accept that interest rates will likely be higher for longer, they’re scrambling to find leaders with the skills to succeed in such an unpredictable environment. Some CEOs are deciding that they need to make drastic, expensive and often unpopular institutional changes to help them keep up. Prior to the current interest rate hikes, banks had been operating with low-interest, stable rates for nearly two decades, he said. That’s a really friendly environment. “Now the seas are stormy and a lot of people aren’t used to managing in that sort of environment, yet alone leading,” said Schiff. “In order to create more accountability around what’s going on, CEOs want less layers of management and a deeper line of sight.” This is new territory for the majority of bankers, said Schiff, and now bank leadership is acknowledging that the environment has fundamentally changed.

Top performing banks - I saw this week that BankDirector had an article on bank performance and that "it may be a surprise that those with a simple focus are top performers". Those banks that focus on what they do best, do well. This has always been the case for the past 40 years and it should be no surprise to anyone in banking. Banks that hop on the newest trends or stray from their core business and markets will typically learn some financial lessons. Economic recessions typically expose these lessons. If a bank is going to explore a trend, add a new business, or stray from what they do best; then the bank management should do so with an intentional plan to learn the business, hire resources that are experienced in the business, anticipate up and downs, understand that the culture will be different, and set aside some reserves for when surprises happen. When Executives attend conferences, they bring back success stories of non-core business opportunities. Just remember that another companies success is likely because it has been their core business and strength for years. Those companies likely went through their growing pains a decade or two ago and have now hit their sweet spot. If a bank is venturing into unchartered territory for themselves, they need to do so with their eyes open and a solid plan. The bank management should also understand what resources they will be redirecting away from their core strengths. #commercialbanking #communitybanking #communitybank #banking #bankingandfinance #strategicplanning #mergersandacquisitions #businessplanning

Thanks Nicole Goodkind with CNN for chatting with me about the changing dynamics in the banking industry. In the story, we discuss the challenges of leading a bank in today’s high-inflation and high-interest rate environment - one that hasn’t really been experienced in decades. I highlighted the importance of strong leadership, soft skills, and strategic ambition to adapt to this new environment. Read the full article to learn more about the evolving landscape of banking. #banking #restructuring #leadership

JPMorgan Chase & Co., executives at Bank of America, Citi., and Wells Fargo said consumer spending "remains strong, underlying growth was "very strong" across their business, and all predict the USA is headed for a “soft landing” coming out of the recession.   But Edward Jones analyst James Shanahan described these financial institutions' actual business results as a "noisy" and "pretty soft across the board" quarter for the banks that reported on Friday.   Read this Morningstar article for more interesting information. #mondaymotivation #markettrends #marketwatch #forecasting #consumerspending

🏦Under the Spotlight: Big Bank CEOs Facing Unprecedented Challenges. In today's fast-paced financial world, the #CEOs of our biggest #banks are navigating turbulent waters like never before. This insightful article highlights the immense pressures these #leaders are currently facing. The decisions made by these CEOs have a profound impact on global #finance and the economy as a whole. It's a reminder of the immense #responsibility they shoulder, especially in these times of uncertainty. Let's delve into this topic, exchange views, and discuss how their strategies might shape the future of #banking. #BankingLeadership #FinanceIndustry #EconomicInsights #LeadershipPressure #LinkedInArticle #FinancialNews #ThoughtLeadership #Financialadvisr #wealthmanagement #globalfinance Jane Fraser, Citi, David Solomon, Goldman Sachs, Wells Fargo, Jamie Dimon, JPMorgan Chase & Co., Bank of America Read more: Yahoo Finance, David Hollerith https://lnkd.in/gMz6cAYV