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Ardmore Sponsors RMA Philadelphia’s 2024 Bank President’s Panel
For the 19th year in a row, Ardmore served as the Gold Sponsor for the RMA Philadelphia Chapter’s 2024 Bank Presidents Panel. The event, held May 21st at the Union League, brought together nearly 100 bankers, and featured a panel discussion that ranged from the use cases for Artificial Intelligence (AI) in banking, the current biggest risks facing the industry, and the merger and acquisition outlook.
Geoffrey D. Brandon, Pennsylvania Market President, TD Bank, Ginger Kunkel, President, Tompkins PA and Travis M. Rhodes, Regional President of Pennsylvania/New Jersey for Truist Financial Corporation made up the panel moderated by Ardmore’s Teresa Wood.
What follows is a brief summary of the discussion:
The panelists singled out regulatory scrutiny, interest rate and net interest margins, and market risk as the biggest threats facing the industry today. They opined that increased regulatory oversight could impact bank operations and inflate compliance costs, while fluctuations in interest rates will affect banks’ profitability. They also cited the ever-present economic and geopolitical uncertainties that pose threats to market stability and bank health, including the ongoing conflicts in Ukraine and the Middle East as potential disruptors.
On the subject of AI, all of the panelists agreed that there are numerous potential applications in the financial services industry, but everyone is still weighing risks and determining the most beneficial uses. While technology can enhance fraud protection, narrative summarization and operational efficiencies, model validation will limit consumer applications, as the same technology can be used for bad actors and fraud.
When asked to identify potential trends for 2024 and 2025, the panel identified the challenges that smaller banks are facing with talent acquisition and regulatory compliance costs, the geopolitical shocks as indicated above, and the opinion that low-performing banks will be eventually exposed.
The panel was perhaps at its most vocal when asked about the lack of young talent in the industry. The panelists agreed that while there is a long way to go to replicate the management training programs of the past, the current environment presents an opportunity for the younger generations. Not only will they bring much needed energy to banking, their skills with technology will help institutions discover new efficiencies and applications.
The speakers said that while bank share prices have lowered to the point where new mergers and acquisitions are possible, smaller banks who are looking to sell may have to do so at a lower price than anticipated.
Finally, despite the fact that some of the discussion around climate-related credit risk has cooled since a recent regulatory announcement, it’s crucial for banks to consider such factors in their day-to-day. Regulators are increasingly viewing climate risk as credit risk, and the panelists emphasized that the regulators are not considering the carbon footprint or environmental impact that a potential lender can create, but rather, asking them to consider whether or not a flood, earthquake or wildfire would render the borrower ineffective or delinquent.