The Banker Next Door

According to Bank Director’s 2026 Technology Survey, banks are feeling the pressure from increased competition, emerging technology, and changing strategy. Key findings from the report include efficiency over growth, getting educated on artificial intelligence, gauging AI usage, integration challenges, prioritizing payments, and most not sold on crypto. A majority of bank executives view financial technology firms including Block and PayPal as their greatest competitive threats. Only 16% of bank executives see cryptocurrency or stablecoin as a top competitive threat. Perhaps the biggest finding is that 70% of bank executives say their bank does not have a strategy to reach younger accountholders. This episode reviewed Bank Director’s 2026 Technology Survey. A link to the survey is included below.
Link: 2026TechReport-Open-Version.pdf

This video is a clip from BND: Strategy Room Live Stream on September 12, 2026. Private Credit favorites Blue Owl and Jefferies face new issues. Jefferies is staring down a potential $500 million loss from Radiant World. Blue Owl Capital cut the value of its loans to Loparex to near zero. In addition, the current oil shock is testing Private Credit borrowers with high debt loads. Smaller borrowers are seeing rising defaults. The episode reviewed articles from Reuters, Seeking Alpha, CNBC, and The Business Journals.

The Banker Next Door (BND) weekly live stream show. Strategy Room provides financial news, commentary, top stories in the business world, economic indicators, and all things banking for the week.

Who is Jane Street? They are a mysterious high frequency trading hedge fund on Wall Street that seems to have its hands in everything with some questionable behavior. Jane Street was started in 2000 by three former executives of Susquehanna International Group and an IBM developer. There is no public face to the firm, and they do not like publicity. New hires are discouraged from drawing any attention to themselves or the firm. That means no media and anything that might catch the attention of regulators. Jane Street has grown from a handful of employees to over 3,500 with $45 billion in trading profits so far in 2026. Jane Street has become a major player on Wall Street and when they surface in the news it is usually negative. Whether allegations of insider trading in crypto, having an alum like Sam Bankman Fried, suing rival Millennium Management, or losing $15 billion to situational awareness, this hedge fund gets around. Make no mistake, this hedge fund is here to stay, and they are part of the new bread on Wall Street. This episode reviewed two articles from The Wall Street Journal (subscription required) titled “Secretive Wall Street Powerhouse Jane Street Seizes the AI spotlight” and “Jane Street suffers loss of about $15 billion following troubles at Situational Awareness.”

Italian bank Monte Dei Paschi (BMPS) has had quite the saga over the last two years. BMPS has had CEO issues, multiple potential merger partners, rogue board members, and tons of media! Everything a good banking soap opera needs. When last we left BMPS, Intesa Sanpaolo made an offer to purchase the world’s oldest bank seeking to create the “UBS” of Italy. BMPS responded by attempting to purchase Banco BPM. Intesa Sanpaolo received pushback from Italian regulators and offer to split up BMPS by selling the retail part of the bank to BPER Banca SpA. BMPS has fended off the merger proposal but their bid to purchase Banco BPM was thwarted by their largest shareholder, Credit Agricole. Then BMPS turned around and made joint bids for Banca Generali and Banco BPM. Will BMPS be able to complete these twin mergers? Will they be able to fend off Intesa Sanpaolo? This episode reviewed multiple articles in The Wall Street Journal and S&P Global (subscriptions required).

Security Bank & Trust President Andy Schornack worked with several employees to develop an AI credit workflow solution for processing commercial loans. Andy had investigated several fintech providers and found they had several product solutions, but the costs were prohibitive at five and six figures. These were very high costs for a $1.3 billion community bank to absorb. Andy’s wife, being in the software business, suggested that he try Anthropic’s Claude Cowork. Using Claude, Microsoft Power Platform and SharePoint Andy was able to create an automated workflow solution that was able to replace the current manual process. The cost of this was only a few hundred dollars per month. Andy has worked with his fellow team members to take the workflow through 80 iterations. This is a great example of how AI can work for your bank. This episode reviewed an article from FinXtech titled “How I solved it: Security Bank & Trust uses AI to build credit workflow app.” A link to the article is included below.
Link: How I Solved It: Security Bank & Trust Uses AI To Build Credit Workflow App - FinXTech

Bain & Company recently released a report detailing their outlook on U.S. bank M&A through 2030. Some of the key findings include: 1) there will be at least one bank to cross the $1 trillion assets threshold but could be as high as 2-3 via M&A, 2) There will be continued consolidation for small and larger regional banks, 3) There will be continued consolidation for community banks, 4) Banks should consider under-the-radar options when screening M&A targets, and 5) While scale-and-scope deals are currently outperforming, banks should consider buying fintech challengers. This episode reviewed Bain & Company’s bank M&A report titled “Hidden Gems: How to find the US bank M&A targets everyone else is missing.” A link to the report is included below.
Link: Hidden Gems: How to Find the US Bank M&A Targets Everyone Else Is Missing | Bain & Company

Bank News: Chime to buy Stride for $590 million. Chime outgrew their partner model. Will the Chime deal lead to further fintech-bank competition? EverBank to purchase WaFd in a reverse merger for an approximate cost of $3.9 billion. Does this merger have execution risk? John Marshall Bancorp to purchase in-state peer Eagle Financial Services for $253 million. Finward Bancorp considered 7 different merger partners before accepting First Financial bid. Circle buying Tazapay for approximately $400 million. Bank7 wins auction to purchase 71% of Century Financial. Trustmark bank sells 34 branches to Blue Owl Real Estate Capital in sale-leaseback deal valued at $91.7 million. The founders of Georgia Skyline Bank, a new De Novo in Georgia, have decided to recapitalize Highland Community Bank in Virginia as a faster path to growth and profitability. Mercury received conditional approval for deposit insurance from the FDIC. Block has applied for a National Trust Bank charter through the OCC. United Bancorporation of Alabama is fighting back against activist investors. The Federal Reserve and Governor Bowman are sued by Better Markets over capital-requirements process. GAO report on banks support or nonsupport of cannabis industry. Banks fear of missing out is fueling their AI spending. This episode reviewed multiple articles from Banking Dive and S&P Global Market Intelligence (subscription required)

This video is a clip from BND: Strategy Room Live Stream on September 5, 2026. Bond market yields are not just increasing in the U.S. they are increasing all over the western world. France, Italy, UK, and Japan have all seen increasing 10-year treasury yields. The growing global debt of $350 trillion is getting very expensive to service. Inflation, the war with Iran, $40 trillion in national debt, and a new Fed chairman are all weighing on the U.S. bond market. This leads to several questions. Will the U.S. require a weaker market (i.e. recession) to achieve lower yields? Have we entered a new era of higher interest rates? What do higher rates mean for the government, corporations, and consumers? Everything becomes more expensive to finance. For consumers it exacerbates the issue of affordability. In addition, what do higher rates mean to bank investment portfolios? Right now, they continue to put pressure on AOCI by increasing negative returns. This episode reviewed articles from The Wall Street Journal, The Epoch Times, S&P Global, and CNBC.  

The Banker Next Door (BND) weekly live stream show. Strategy Room provides financial news, commentary, top stories in the business world, economic indicators, and all things banking for the week.