In this episode, host Jeff Bogan speaks with Ethan Heisler, Editor of The Bank Treasury Newsletter, about how bank treasurers are managing liquidity, regulation, and risk today.

Heisler explains how instant payments and weekend settlement gaps are pushing institutions to hold higher reserves, changing traditional strategies. Heisler considers stablecoins a practical tool for evaluation in cross-border transfers that banks must come to understand.

They also examine how AI and machine learning can move beyond automation to support strategic treasury and balance sheet decision-making. As Heisler notes, better analytics could have changed outcomes at some recent bank failures. AI support for strategic brainstorming and decision-making could benefit many leadership teams, whether bank treasury, depository, financial institution, or asset manager.

“How are you using machine learning/AI to make better decisions? … How can you enhance your brain to do more when you think?” - Ethan Heisler

The conversation covers how examiner turnover, deposit growth, and liquidity preferences are changing priorities, as many treasurers choose to “stay liquid” while adopting new risk management tools. Together, Bogan and Heisler unpack the role of bank treasurers and financial management today.

What You’ll Learn in This Episode:

How bank treasurers are prioritizing liquidity and risk management post recent bank failures

What stablecoins are and their connection to instant payments

How AI and machine learning can support smarter balance sheet decisions

Current trends in regulatory focus, deposit growth and loan growth

Why deposit insurance reform and fintech partnerships matter more

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TIMESTAMPS:

01:00 Ethan shares his background as an Institutional Investor-ranked analyst and the launch of the Bank Treasury Newsletter, with 21 years of industry insights

03:45 Deep dive into stablecoins in banking and how they function as a new payment method for cross-border payments, potentially disrupting the quadrillion-dollar international payment market

10:18 How artificial intelligence in banking and machine learning for financial institutions should enhance cognitive decision-making rather than just operational efficiency

13:00 Critical lessons from Silicon Valley Bank on balance sheet risk management and why liquidity management strategies must account for instant payment systems and deposit volatility

17:59 Discussion of uninsured deposits, deposit insurance, bank examiners, risk management and AI

26:17 The future outlook for the banking industry, including economic stability, deposit insurance reform needs, and fintech partnerships

KEY TAKEAWAYS:

Bank treasurers are rethinking liquidity. Instant payment systems and weekend settlement gaps are leading institutions to hold more cash and short-term assets.

Deposit behavior is changing. Despite the 2023 turmoil, deposits reached record highs, yet more funds are moving into money market products and Treasury bills outside of banks.

AI is underused in brainstorming and decision-making. Many banks apply AI for process automation, but few use it to improve risk and balance-sheet choices, an opportunity for smarter capital use.

Stablecoins could affect cross-border payments. Large banks may gain efficiency and lower costs by adopting stablecoins for international transfers, but widespread understanding is still limited.

Regulation and staffing are shifting. Examiner turnover and new supervisory focus require treasurers and CFOs to strengthen analytics and prepare for deeper regulatory review.

ABOUT THE GUEST:

Ethan Heisler is the editor-in-chief of The Bank Treasury Newsletter, commentary on bank treasury issues, investment portfolio strategy, asset/liability management, and trends. Ethan began his career on the repo desk at Dillon Read in 1981. Since then, his career has included senior positions in fixed income sales and trading, corporate bond research, and bank supervision. His experience spans multiple economic and interest rate cycles and includes work on key bank accounting and regulatory capital policies. He has analyzed banks in the U.S. and abroad. While a managing director in Corporate Bond research at Citigroup, he was recognized by Institutional Investor as a leading analyst of U.S. and Yankee banks.

Ethan Heisler - Website - https://www.thebanktreasurynewsletter.com/

Ethan Heisler - LinkedIn - https://www.linkedin.com/in/ethan-heisler-58b370119/

Jeff Bogan – Website - https://www.upgrade.com/team/jeff-bogan/

Jeff Bogan - LinkedIn - https://www.linkedin.com/in/jbogan5/