24 people who will change banking in 2024

December 21, 2023 10:26 PM

New Year's Eve fireworks in Times Square, New York City.

2023 was a big year for banking — the spring banking crisis and its regulatory aftermath took up most bankers' energy all year — and 2024 looks to be just as consequential, if hopefully not as dramatic. A presidential election will determine who controls the White House and the regulatory agenda. The economy is struggling to lift off past inflation, and the Fed's rate moves will be closely watched. American Banker's reporters and editors looked at the industry to see which players are likely to have the most impact on banks this year. Check out our picks, listed in alphabetical order.

Sam Altman

CEO, OpenAI

Key Speakers At Bloomberg Technology Summit

David Paul Morris/Bloomberg

Along with likely holding a record for shortest exile from the helm of a company, Sam Altman is spearheading development of one the most transformative technologies in recent history. Generative artificial intelligence, which Altman's company OpenAI popularized through its ChatGPT product, will seep into every industry and every facet of the economy, experts say.

Altman, who leads OpenAI as CEO, is a Silicon Valley veteran, having previously worked his way up to leadership at Y Combinator, a startup accelerator that launched fintechs like Stripe, Brex and Coinbase. In 2015, Altman co-founded OpenAI with a team of tech heavyweights, including Elon Musk (another one of American Banker's 24 people to watch in 2024), with the goal of advancing "digital intelligence in the way that is most likely to benefit humanity as a whole."

The 38-year-old Stanford dropout has since overseen the push of artificial intelligence past previously-established boundaries, while recognizing the risks of the wide-scale use of generative AI and large language models.

Banks, notably risk-averse in nature, have toed the line of remaining relevant with technology and introducing danger to their ecosystems. While it's still early days for the sometimes-controversial innovation, many banks are researching and developing strategies to use generative AI. From internal functions like coding assistance to customer-facing projects like chatbots, financial institutions and fintechs are mapping their journeys with inspiration from, or in collaboration with, OpenAI.

OpenAI is the large language model provider for a number of financial firms: Ally Bank has piloted a contact center project, software providers Blend and Q2 have begun work on a co-pilot offering to help employees field customer needs and employees at SouthState Bank in Winter Haven, Florida use an enterprise version of ChatGPT for tasks like summarizing regulations, drafting marketing materials and composing emails.

In November, amid generative AI being a hot topic of the year, Altman was fired from OpenAI. Then, he was hired at Microsoft. Then, after a five-day drama that played out all over the news and social media world, he was rehired at OpenAI, following threats of resignation from most of the company's roughly 700-person workforce.

Altman has championed AI this far and, in 2024, there are no signs that banks' excitement for the technology will temper. Artificial intelligence is one of the top technology priorities for banks next year, according to research from Arizent, American Banker's parent company.— Catherine Leffert

Michael Barr

Vice chair for supervision, Federal Reserve

Al Drago/Bloomberg

Between responding to a string of bank failures, spearheading a slew of regulatory reforms, and initiating a cultural overhaul for bank supervision, Michael Barr, the Federal Reserve's vice chair for supervision, had his hands full in 2023.

Heading into 2024, things don't seem to be slowing down for the Fed's chief regulator.

Alongside Federal Deposit Insurance Corp. Chair Martin Gruenberg and Acting Comptroller of the Currency Michael Hsu, Barr is championing a set of regulatory reforms that could have sweeping impacts on the banking system. This includes risk-weighted capital rules under the Basel III endgame and a long-term debt requirement for all banks with at least $100 billion of assets.

Barr has said those proposals — which were put forth in 2023 and are expected to be finalized at some point during the next 12 months — will make the banking system more resilient to shocks and economic hardships. Critics, meanwhile, say the changes are excessive and will put undue constraints on a banking system that is already well capitalized.

After the comment periods for those proposals close in January, Barr will oversee any changes made to the final rules before they are put to a vote.

The Fed only needs a simple majority — four of the seven members of the Board of Governors — to ratify the final rule, but two governors, Michelle Bowman and Christopher Waller, have already voted against the capital reforms. Vice Chair Philip Jefferson, who voted for the proposal, noted concerns he would like to see addressed in the final version of the rule. Fed Chair Jerome Powell said he will target a "broad consensus" among the board for the final rule.

For his part, Barr has said he would like as big of a consensus as possible, but unanimity would not be required.

Barr also indicated that new policies could be necessary to ensure banks have sufficient liquidity management practices, so that could be on the regulatory agenda in 2024, as could interest rate risk management. Both issues played a role in the bank failures of this past spring.

Barr has also vowed to ensure the Fed's supervisors feel empowered to identify and elevate issues of concern at the banks they examine as another response to the failures. Some banks have already complained of an uptick in supervisory activity in recent months. The severity of supervisory scrutiny is poised to be another ongoing development in the year ahead. — Kyle Campbell

Joe Biden

President, United States

Ting Shen/Bloomberg

President Joe Biden's bully pulpit gives him one of the most powerful voices in the banking world — and in 2023, he started using it.

The regional bank failures sparked a number of policy-related speeches from Biden, calling for enhanced bank rules and enhanced abilities for banking regulators to claw back the compensation of failed bank executives. He urged regulators to address the causes of the bank failures and lawmakers to reconsider tailoring rules that weakened some requirements for large regional banks.

""Let me be very clear, all depositors are being protected, shareholders are losing their investment. Critically, taxpayers are not the ones on the hook," Biden said in the Rose Garden after the failures. "Going forward, I've called on Congress to give regulators the tools to hold banking executives accountable."

While some of the political urgency around post-failure reform has faded since summer, Biden still has a number of initiatives in the works that could impact the business of banking.

The Biden administration has targeted so-called "junk fees," including promises to put pressure on banks using overdraft or non sufficient fund fees, as well as high-cost medical financial products like credit cards.

Biden also issued an executive order on artificial intelligence, directing the Consumer Financial Protection Bureau and the Federal Housing Finance Agency to monitor for lending bias. The Department of Housing and Urban Development, along with the CFPB, will issue guidance on discrimination in tenant screening systems. The Treasury Department will also produce a report on artificial intelligence-specific cybersecurity risks for financial institutions.

"AI is all around us," Biden said in remarks before he signed the order. "To realize the promise of AI and avoid the risk, we need to govern this technology."--Claire Williams

Greg Carmichael

Executive chair, City National Bank

Greg Carmichael's retirement didn't last for very long.

The chief executive of Fifth Third Bancorp in Cincinnati stepped down from his role at the $213 billion-asset bank in July 2022, at the age of 60, and became executive chairman of the board of directors. He said at the time that he always planned to retire when he was still in good health and had the energy to pursue other potential business opportunities.

"The bank is ready for this transition," Carmichael told American Banker.

Less than a year later, he relinquished his executive chairman position as well. But those "potential business opportunities" he mused about in 2022 ended up being more consequential than he likely imagined.

In March, Silicon Valley Bank and Signature Bank were shuttered by regulators two days apart after both experienced a run of deposits. Carmichael was selected to run the bridge bank that would take Signature's place, leaving his post as chairman at Fifth Third a month earlier than planned.

In September, Carmichael was tasked with another turnaround. City National Bank in Los Angeles announced that he would become executive chair of its board of directors, reporting directly to parent company Royal Bank of Canada's CEO Dave McKay, with City National CEO Kelly Coffey reporting directly to him. (Coffey was supplanted as CEO in November by another former Fifth Third executive, Howard Hammond, and became CEO of the bank's entertainment unit in a new role instead.)

The problems that Carmichael and other leaders must solve at the $95 billion-asset City National are challenging.

The bank reported a $38 million quarterly loss in August due to rising interest rates that resulted in higher funding costs and pressure to reduce lending capacity to conserve capital and liquidity. Losses climbed to $247 million in the fourth quarter.

But RBC executives are optimistic that its U.S. subsidiary will return to profitability, starting with a series of intracompany transactions involving debt securities it made in October and continuing with a renewed focus on productivity and efforts to improve coordination among the U.S. business lines of wealth management, capital markets and City National Bank. A more-leisurely retirement for Carmichael will have to wait. — Miriam Cross

Rohit Chopra

Director, Consumer Financial Protection Bureau

Ting Shen/Bloomberg

CFPB Director Rohit Chopra will make his mark in 2024 by eliminating so-called "junk fees," and advancing an agenda to conduct oversight of large technology companies. The CFPB faces its own existential threat from a Supreme Court case that could result in the bureau's funding being deemed unconstitutional.

The CFPB plans to issue rules that will wipe out billions in overdraft revenue, credit card late fees and non-sufficient funds fees. Banks have threatened to sue the CFPB, which is preparing for litigation that could drag on for years. Banks and credit unions are especially worked up over a small-business data collection rule that would show how much lending is going to women and minorities, although President Biden vetoed a challenge to the rule in December.

Though Chopra has been a popular target of Republican lawmakers and the financial industry, he has found common ground with some in the GOP who want to give Americans greater control over their financial data.

The CFPB is working on one of its most consequential rules that would protect consumers' financial data privacy rights while also cracking down on data brokers and data aggregators.
Chopra, a former member of the Federal Trade Commission, also plans to supervise large technology and payments firms — including Amazon, Apple and Alphabet's Google, among others. – Kate Berry

Alex Chriss

CEO, PayPal

PayPal

With the dizzying fintech boom and bust of the pandemic era behind it, PayPal's new CEO is in charge of building what comes next.

Chriss became PayPal's CEO in September, following a stint running Intuit's small-business and self-employed unit. Chriss, who replaced the retiring Dan Schulman, impressed PayPal's search committee by successfully managing Intuit's $12 billion acquisition of marketing company Mailchimp in 2021.

At PayPal Chriss faces an economic situation that requires putting the brakes on overspending while keeping the gas on innovation. The company also needs to stay relevant against a group of fast-moving competitors such as Stripe and Block, fintechs, and more traditional payment and bank technology companies such as FIS and Fiserv.

"I'm walking in with my eyes open," Chriss said during PayPal's most recent earnings call. "Our cost base is too high…the company's focus has not been clear." Chriss did not provide a comment for this article. In an attempt to achieve that clarity, Chriss is in the midst of deciding what to add and what to subtract. The payments company shed Happy Returns, selling the logistics business to UPS, with Chriss saying the Happy Returns deal had strayed too far from PayPal's business as a payments company, suggesting more work was ahead as the firm addresses duplication from a series of acquisitions over the past few years.

PayPal is betting on a future for digital assets and emerging tools that can aid a whole range of new payments technology. The payments company has long been bullish on AI's potential to cut costs, invested in AI, and could use generative AI across all parts of its business, including customer support, engineering, compliance, accounting and other tasks.

It's also putting its weight behind stablecoins. PayPal launched its own stablecoin in late 2023, making it one of the first stablecoins from a company outside of the cryptocurrency industry since the failure of the Facebook-affiliated Diem.

PayPal's stablecoin has gotten off to a relatively slow start, but it has picked up steam toward the end of the year, and will play a large role in signaling demand for stablecoin payments.

In a research note, William Blair said PayPal's long-term opportunities remain substantial as the company has evolved from a traditional checkout button to a robust platform of end-to-end solutions for consumers and merchants.

"While early, the company appears keenly focused on leveraging its vast amount of data to improve operational efficiency and we are encouraged by management's narrowed focus on profitable growth," Blair analysts said. —John Adams

Jack Dorsey

CEO, Block and Square

Jack Dorsey.

Bloomberg

In a career that has always defied convention, Jack Dorsey continues to keep people on their toes with unexpected corporate moves reflecting his diverse interests and investments.

Most recently, Dorsey hopped back into the CEO role at Square, the payments arm he co-founded in 2009, to shake things up. He assumed the reins after the departure in October of longtime Square chief Alyssa Henry, who left two weeks after Square suffered a costly nationwide outage of its point-of-sale system.

Dorsey hopes to drive growth at Square parent Block—which he also heads—by bringing the firm's booming peer-to-peer payments network Cash App closer to Square merchants, and restructuring Afterpay, its buy now/pay later unit. Block also plans to trim its total workforce back to 12,000 people in coming months. Toward that end, Dorsey recently said he's doing away with performance reviews across Block. In December, Dorsey cut the workforce at Block's music-streaming unit Tidal by 10%.

The 47-year-old college dropout still believes strongly in Bitcoin, despite the cryptocurrency's ups and downs. Bitcoin will eventually be essential for global micro-payments and remittances, among other types of transactions, Dorsey told analysts in November. "We always knew [Bitcoin] was going to be a long-term play…there's no doubt that the Internet will have native currency and Bitcoin is the best candidate," he said.

In December, Block announced its hardware-based Bitcoin wallet, Bitkey, was available for pre-order at $150 in 95 countries; the devices will ship in early 2024.

In his spare time, Dorsey continues to serve on the board of directors of Bluesky, the 2.3 million-user open-source social app he dreamed up in 2019 when he was still on the board of Twitter, which he helped to co-found in 2006. Dorsey left Twitter's board in October 2022, when Elon Musk finalized his acquisition of the platform now called X. – Kate Fitzgerald

Jane Fraser

CEO, Citigroup

Photographer: Valerie Plesch/Bloomberg

In 2024, Jane Fraser will enter her fourth year as CEO of Citigroup, and the fourth year of a massive overhaul that's meant to create a leaner, cleaner and more profitable global bank.

While Fraser has been taking big steps to rightsize Citi and realign the $2.4 trillion-asset company's priorities — such as selling or winding down consumer franchises in 14 countries, closing its once-dominant municipal business and continuing to push forward with a regulatory mandate to improve risk management and compliance systems — her latest move is by far the largest. And if it works, the megabank is bound to look a lot different at this time next year.

In September, Fraser launched a revamp of Citi's organizational structure, reducing the firm's management layers from 13 to eight, giving herself more direct oversight of the company's five core businesses and eliminating various support roles that are no longer necessary, given Citi's retreat from several international markets. The changes, which Fraser says will fundamentally alter how Citi operates, means significant job cuts, which are happening through the first quarter.

The New York City-based company has not yet said how many or what percentage of its employee base will be laid off. Citi employed about 240,000 worldwide as of Dec. 31, 2022.

Some of those details may be provided during Citi's fourth-quarter earnings call in January.

In a memo to employees in late November, when the company announced the latest round of changes, Fraser said Citi is "moving at pace" on the reorganization, which has been onerous.

"No question, these are the proverbial hard yards," wrote Fraser, who was named American Banker's Most Powerful Woman in Banking in 2021, 2022 and 2023. "We always knew that changing the trajectory of our bank would not be easy, but I remain confident as ever about the path we're on and the value that our hard work will create for Citi and each of our stakeholders."

Citi is likely to spend around $1 billion on various restructuring charges, with a large part of that tied to the management reduction initiative, Chief Financial Officer Mark Mason said this month.—Allissa Kline

Andrea Gacki

Director, Fincen

Jeenah Moon/Bloomberg

Appointed in July to run the Treasury Department's Financial Crimes Enforcement Network (Fincen) during a moment of relative calm, Andrea Gacki, in short order, found herself facing a series of urgent domestic and international challenges.

A longtime veteran of the department, Gacki was pivotal in shaping sanctions against Russia after its invasion of Ukraine in her previous role directing the Office of Foreign Assets Control. Now Gacki holds ultimate responsibility for finding more effective ways to thwart Russia, which continues to evade various economic blockades.

Simultaneously, Gacki is now heading the U.S. response to a recent surge in warnings of suspicious activity related to Hamas' terrorist financing in the wake of the October 7 Israel attack, and seeking financial institutions' assistance.

On the home front, Fincen is navigating a pushback by U.S. organizations over the Corporate Transparency Act, which requires companies to report who their beneficial owners are. Many smaller companies say they're unprepared to comply, and banks are seeking clarification from Fincen about who is ultimately responsible for reporting beneficial ownership and maintaining a real-time database of corporate information.

The CTA rule was slated to go into effect Jan. 1, 2024 as part of the Anti-Money Laundering Act of 2020. In November 2023, just before a bipartisan bill introduced by Rep. Zachary Nunn, R-Iowa, passed the House that would extend the deadline for companies to report ownership information, Gacki provided some breathing room. Fincen extended the deadline for companies created or registered in 2024 to file beneficial ownership to 90 days after creation; firms created prior to 2024 have until Jan. 1, 2025 to file.

Demonstrating her commitment to getting results in Fincen's tightening oversight of banks, in October, Gacki said Fincen is finalizing rules to expand a whistleblower incentive program that would provide monetary rewards for tips leading to financial institutions whose transactions violate sanctions and anti-money-laundering laws.

In another ambitious twist, Gacki intends to use Fincen's rules to battle environmental crimes, including wildlife trafficking, illegal logging, fishing, mining and other resource extraction, she said in September at an event in Washington, D.C. sponsored by various organizations, including the Basel Institute on Governance.

With her deep experience within the Treasury department, Gacki has her work cut out in taking a global approach to battling corruption and protecting U.S. financial interests. —Kate Fitzgerald

Gary Gensler

Chairman, Securities and Exchange Commission

Andrew Harrer/Bloomberg

One of the Biden administration's most aggressive financial regulators is Gary Gensler, head of the Securities and Exchange Commission.

Gensler's purview at the SEC is mostly as publicly traded companies' "cop on the block," not as a traditional banking regulator, but he's made a splash in the banking policy world regardless. He's one of the loudest voices on issues around artificial intelligence.

"There are some risks in our capital markets, some which could lead to conflicts in the markets and some that are harder to grapple with," Gensler said at a Senate Banking Committee hearing earlier this year. "It may well be that the financial crisis in a number of years, or in ten years, is because we find everyone in the mortgage market may be relying on one model."

Gensler is also a vocal member of the Financial Stability Oversight Council, and his experience as a financial regulator around the time of the 2008 financial crisis makes him a leading figure in the Biden administration's crop of officials. He's linked the large regional bank failures, as well as the unwinding of Silvergate, directly to digital assets, in a major indication of how the administration views crypto.

"Silvergate and Signature [banks] were engaged in the crypto business — I mean some would say that they were crypto-backed," Gensler said at a House Financial Services Committee hearing earlier this year. "The third, the biggest, Silicon Valley Bank, actually when it failed, you saw the country's — the world's — second-leading stablecoin had $3 billion dollars involved there, depegged, so it's interesting just how this was all part of this crypto narrative as well."

But perhaps most importantly, Gensler has pursued rulemakings that, while not necessarily geared toward banks, could have a major impact on how banks are overseen in Washington.

One of these rules is a revamp of how certain assets are held in custody. While it's meant to mostly address how crypto is held by various financial institutions, critics say it could, at minimum, upend custody banking. Specifically, the proposal would require bank custodians to assume a greater degree of liability for sub-custodian and central securities depositories, which a custodian bank might not be able to control.

Another important rule for banks to watch in 2024 will be an SEC funds rule, which investors argue could drive bank loan funds out of business. The rule would expand the definition of an illiquid investment, causing a variety of types of funds to exceed the 15% cap on illiquid assets, a category that the Investment Company Institution says would disproportionately include bank loan funds. —Claire Williams

Martin J. Gruenberg

Chairman of the Federal Deposit Insurance Corporation

Ting Shen/Bloomberg

This year, Federal Deposit Insurance Corp. Chairman Martin J. Gruenberg steered the FDIC through the resolution of numerous failed banks, addressed controversy over workplace conduct within his agency, and, alongside fellow federal regulators like Fed Vice Chair Michael Barr, introduced some of the most sweeping and controversial bank regulatory reforms since the Dodd-Frank Act.

In 2024, Gruenberg will continue to be confronted by lawmakers across the political spectrum with concerns about alleged harassment and a toxic workplace culture at the Federal Deposit Insurance Corp. These concerns have triggered calls for Gruenberg to resign, putting at risk the FDIC board's thin democratic majority necessary for accomplishing the administration's agenda. While industry experts broadly expect the chairman to hold on to his seat, any new revelations unearthed in the ongoing investigation, led by law firm Cleary Gottlieb and overseen by a bipartisan panel chaired by Democrat Michael Hsu and Republican Jonathan McKernan, remain pivotal to the FDIC veteran's reputation.

The slate of new rules and guidance, significantly influenced by March 2023 bank failures, includes revamped capital requirements, long-term debt requirements, corporate governance protocols and resolution planning requirements for large firms.

The bank agencies' joint capital rule, implementing the Basel Committee's most recent global capital standards, would bring about major changes to the current U.S. risk-based capital framework for approximately 40 of the nation's largest banks. Despite long-standing opposition from the banking industry, which views the measure as unnecessary and potentially harmful for consumer lending, regulators portray the rule as a responsible tradeoff. They argue that it enhances banks' resilience over the long term in exchange for a marginal increase in the cost of loans.

With many comment periods for these rules closing in January, Gruenberg must retain his seat to facilitate the implementation of the new rules. Gruenberg also anticipates that around the same time, the bank agencies will reintroduce regulations prohibiting executive compensation arrangements that trigger moral hazard. The rule was previously proposed in 2016, but remains incomplete. By re-proposing the rule, regulators effectively restart the rulemaking and comment process. — Ebrima Sanneh

Geoffrey Hinton

Former Google engineer; godfather of AI

Chloe Ellingson/Bloomberg

After retiring from his job as a vice president and engineering fellow at Google earlier this year, Geoffrey Hinton set out to sound the alarm on the existential dangers of artificial intelligence. He is trying to slow the advance of the technology and regulate its uses — a campaign that is likely to affect how banks deploy AI in new and expanding ways.

Hinton is one of the world's most qualified experts on AI, and through his work in the field, he has gained an appreciation for the myriad ways in which it can empower humanity. However, he is also among the most prominent voices of concern in the field. Many of Hinton's loudest warnings are apocalyptic in nature — that AI might replace humanity.

"You should definitely have quite a lot of awe and you should have a little tiny bit of dread, because it's best to be careful with things like this," Hinton said in an interview with CBS News in October.

Hinton told MIT Sloan School of Management it is conceivable humanity "is just a passing phase in the evolution of intelligence," and that AI is the next step in that evolution. He told the New York Times that his fundamental beliefs about what AI can achieve have changed in the three decades he has spent studying the tech.

"The idea that this stuff could actually get smarter than people — a few people believed that," he told the New York Times. "But most people thought it was way off. And I thought it was way off. I thought it was 30 to 50 years or even longer away. Obviously, I no longer think that."

While he is known widely for this dramatic rhetoric about the risks of AI, he has also shared a dramatic vision of what governments need to do to reduce what he sees as existential threats from AI.

Namely, Hinton believes the best path forward is for the world's leading scientists to collaborate on ways of controlling the technology. He believes that the race between Google, Microsoft and others over AI will escalate into a global race that will not stop without some sort of global regulation.

"I don't think they should scale this up more until they have understood whether they can control it," he told the New York Times.

While Hinton has offered vague ideas about how these regulations might look, he has also said his reason for leaving Google was to speak more freely about the risks AI poses. Over the next year, these ideas may sharpen into policy and regulatory proposals to slow the deployment of AI across society.

If the focus of Hinton and other AI skeptics turns to the technology's use in finance, it is likely to create a drag on banks' ability to leverage what research from American Banker finds is banks' top tech priority for the coming year.— Carter Pape

Lina Khan

Chair, Federal Trade Commission

Ting Shen/Bloomberg

The Lina Khan-led Federal Trade Commission has spooked M&A lawyers almost everywhere, fighting high-profile tech mergers as well as smaller hospital chain tie-ups.

So banks may be thankful that her agency has no formal role in bank mergers. Even so, Khan's approach has gotten attention in a bank M&A world where regulators are also taking a tougher tone.

The FTC has also worked with the Department of Justice to develop tougher merger guidelines, which may affect the thinking on some bank mergers. Most of them, of course, are small and get little attention, but they're still subject to DOJ scrutiny and revised math on what would pose concerns over concentration.

Khan's agency has made other headlines in the financial services space as well. It's battled with Mastercard over debit-routing rules, penalized the consumer finance app Brigit, dinged the credit-reporting firm Experian over unsolicited emails to consumers and fined Credit Karma over credit-card related offers.

Elsewhere in the finance world, the FTC has also gone after auto dealers for "junk fees" and questionable practices — mirroring the Consumer Financial Protection Bureau's scrutiny on such issues in auto finance and elsewhere. That's not surprising: Khan worked under CFPB Director Rohit Chopra when he was an FTC commissioner.

Auto lenders are well aware of the FTC's role in the industry, even if it's indirect. One notable action is the FTC's move last year to put auto lenders on the hook for legal fees in cases where car dealers may have defrauded consumers. Similarly, the agency has recently finalized a major overhaul of sales practices at car dealerships through its CARS Rule, which stands for Combating Auto Retail Scams. It all points to the FTC indirectly putting pressure on auto lenders, even if the agency's remit is solely auto dealers. —Polo Rocha

Mary McDuffie

President and CEO, Navy Federal Credit Union

For Mary McDuffie, president and chief executive of Navy Federal Credit Union in Vienna, Virginia, 2023 has been a year of significant milestones.

While at the helm of the $168.4 billion-asset credit union, the largest in the world, she has racked up accomplishments ranging from joining The Clearing House's instant payment settlement system to building a third-quarter loan book totalling roughly $122 billion when others are scaling back underwriting efforts.

Navy Federal has also seen similar growth in its membership numbers, passing 13 million members in July after significant investments in technology and marketing campaigns, according to National Credit Union Administration call report data. By comparison, the next five largest credit unions in the country by assets had less than 9.5 million members combined at the end of the first quarter of 2023, NCUA data showed.

But McDuffie has struggled to replicate that same level of success in other initiatives — including its contract with the U.S. Department of Defense's Overseas Military Banking Program.

Previously held by Bank of America for the past 40 years, the program went to Navy Federal after the bank decided not to renew the contract granting control of roughly 60 banking facilities and 275 ATMs throughout military bases in Europe and the Pacific.

"We're very proud to have been awarded this contract. … Supporting active-duty personnel and their families, wherever they are stationed, is at the core of Navy Federal's mission," McDuffie said in a press release.

The credit union has remained in a stalemate since then with leading NCUA regulators who say federal law prevents the agency from providing insurance to accounts offered as part of the DoD's program.

Under the terms of the contract, active members of the military who open an account would do so with "Community Bank, operated by Navy Federal Credit Union," which would not make them members of Navy Federal itself. This distinction, according to comments made by an NCUA spokesman, is what has led the NCUA to determine that these accounts aren't eligible for backing by the National Credit Union Share Insurance Fund under the Federal Credit Union Act.

"Deposits made by customers of the Community Bank as part of the Overseas Military Banking Program are separate and apart from those deposited by members of Navy Federal Credit Union," said the spokesman, Joe Adamoli. "Navy Federal would only be acting as a servicer for the DoD program, and the deposits from that program would not be those of Navy Federal's members."

This ongoing standoff, combined with a recent lawsuit alleging that the credit union discriminated against minority mortgage applicants, could both continue to be problems for McDuffie in the coming year. —Frank Gargano

Patrick McHenry

Chairman, House Financial Services Committee

Andrew Harrer/Bloomberg

Next year might be Patrick McHenry's last as a changemaker in banking.

McHenry, a North Carolina Republican representative chairing the House Financial Services Committee, announced in December that he will not seek reelection in 2024.

After nearly two decades in Congress, the once ambitiously feisty congressman who's become a toughened voice of reason in a time of fractionalized politics says that his season for legislative debate is coming to an end.

Since taking the gavel of the House Financial Services Committee following last year's midterm elections, McHenry has made "fighting unsound policy" the conservative mantra of the committee's agenda while allowing for bipartisan compromise on new and emerging priorities.

Potentially the most dramatic item on that agenda depends on the outcome of a Supreme Court decision on the constitutionality of the Consumer Financial Protection Bureau's funding structure, which falls outside the congressional appropriations process.

Over the summer, McHenry led a group of Republican lawmakers to file an amicus brief urging the Supreme Court to rule that the CFPB's current funding structure should be decided by "normal political and legislative channels."

Beyond attempting to restructure the CFPB, McHenry is likely to continue pursuing legislation with Rep. Maxine Waters, a Democrat from California and ranking member of the House Financial Services Committee. The two members have worked together on a bill that would regulate cryptocurrencies and digital assets.

McHenry is also set to continue Republican pushback against new regulations and corporate policies that include environmental, social and governance factors in banking and investment decision-making. In July, McHenry held a committee hearing to discuss proposals that would limit companies and regulators from adopting ESG policies.

"I've seen a lot of change over 20 years. I truly feel this institution is on the verge of the next great turn," he said in a statement announcing his retirement from Congress. "Evolutions are often lumpy and disjointed, but at each stage, new leaders emerge." — Jordan Stutts

Elon Musk

Owner, X

Marlena Sloss/Bloomberg

X is not what Twitter used to be. And in a year from now, it may transform again into something else entirely: a financial super app.

Musk, who was once best known as a founder of PayPal, gave his new company an ultimatum at the end of October: Transform X into a financial app in one year's time. As Twitter, the social media site had dabbled in payments from time to time, but this new project is different in that Musk's goal is to fully displace banks by allowing the X app to let users manage their entire financial lives.

Although Musk has been seen as chaotic and unpredictable, his commitment to the super-app plan is a clear priority. The very name he chose for the company, X, was the name of the internet bank he founded; that company combined with Confinity in 2000 to form PayPal.

X has many obstacles to overcome, including the drop in revenue that's resulting from companies pulling their ads from its platform. Public perception is another hurdle, since the culture of X is drastically different from what was once Twitter, following cuts to the company's content moderation staff. People won't use X for their finances if they don't trust the platform.

But despite it all, X still has many users paying $8 per month for its premium tier — or double that for Premium+, which removes ads and promises access to an upcoming conversational AI tool called Grok. These are the people who will be most receptive to Musk's plan for adding financial services.

When Musk unveiled his vision for an X super app, Max Levchin, a fellow PayPal founder who now runs the buy now/pay later company Affirm, was skeptical of the idea. But in a Bloomberg interview, he added this caveat: "Don't ever put anything past Elon. He has proven time and time again that he can achieve crazy things." —Daniel Wolfe

Prem Natarajan

Chief scientist and head of enterprise data and AI, Capital One

David Paul Morris/Bloomberg

Prem Natarajan grew up in Puna, India, playing cricket and speaking several languages, including English, Hindu and Maraki. He developed a deep interest in language that led to interest in natural language processing and a broader curiosity about artificial intelligence and machine learning.

He worked at several tech companies, honing his AI knowledge and skills. In 2018, he joined Amazon and helped develop Alexa's speech capabilities.

This past March, Capital One hired Natarajan to be chief scientist, executive vice president and head of enterprise data and AI.

"He comes from a Big Tech culture," said Alexandra Mousavizadeh, CEO and co-founder of AI research and benchmarking firm Evident. "He is taking the innovation culture that he inculcated previously and bringing it to Capital One."

Capital One declined a request for an interview with Natarajan. On the Dec. 4 TWIML AI Podcast with Sam Charrington, Natarajan spoke of progress his team has made in deep learning, combining structured data with advanced AI, and understanding the best uses for large language models.

"From a more philosophical perspective, but one that makes it into our computational work, [we're working on] things like how do we make all of this more inclusive?" Natarajan said. "How do we increase access to it across the full spectrum of people who come to us for our services? And there, we are looking into the intersection of core AI machine learning technology with user experience – what kind of design approaches help amplify access or democratize availability of these things to folks?"

Capital One has long been a quiet innovator. It was the first bank to adopt cloud computing in a significant way. It was one of the first to let its developers participate in and lead open source software projects. It was one of the first to launch a virtual assistant, Eno.

The bank scored high In Evident's recent analysis of the top 50 North American banks.

"Capital One is quite far ahead and it's continued to double down," Mousavizadeh said. "The bank has wrapped its head around getting the right talent, having the right vision, having the right operating model, having the right innovation stack, and it's able to pull ahead much, much faster than others. It is very much an AI-first driven culture. It has very strong AI leadership. The team is streamlined, they're organized, they're fast in terms of getting models into production."

All of these things help Capital One attract tech talent, Mousavizadeh said. In the end, Natarajan hopes to change the way people work.

"The purpose of AI in my mind should be to transfer the cognitive burden from the user to the system," Natarajan said on the podcast. "That's on the noble list of missions. You transfer the cognitive burden. All of us have so many cognitive burdens every day that if you can transfer a little bit of that cognitive burden over to a system, we're doing good." —Penny Crosman

Ted Pick

Incoming CEO, Morgan Stanley

Jeenah Moon/Bloomberg

In October, three-decade Morgan Stanley veteran Ted Pick was named to the CEO job at the firm where he's worked since graduation, replacing longtime boss James Gorman, who will become executive chairman. It was the culmination of a two-year process that set up a four-way horse race among Gorman's lieutenants; unusually, once Pick got the job, two of his rivals decided to stay at the New York City-based bank (both, plus Pick, received $20 million bonuses to stay put; one had previously left the firm).

Pick faces a number of challenges as he takes over: Federal investigators are reportedly probing Morgan Stanley's wealth management unit for money-laundering violations, and the bank's third-quarter profits slid as the market for investment banking hit a rough patch. That's alongside the pressures facing all Morgan Stanley's peers as 2024 begins, including the regulatory fallout from the spring 2023 banking crisis and the lingering effects of rising interest rates after the pandemic-era zero-rate environment.

Morgan Stanley has already laid off thousands of workers in 2023, and uncertain markets could mean trouble for its ETrade brokerage unit, although market volatility is generally positive for stockbrokers. For Pick, the time has come finally to make his own mark on the firm he's long called home. —Chana R. Schoenberger

Jerome Powell

Chair, Federal Reserve

Bloomberg News

Federal Reserve Chair Jerome Powell has two balancing acts to pull off in 2024.

The first tightrope he must walk is the one the Fed has been standing on since March 2021, as it looks to tamp down runaway inflation without crushing the economy in the process.

To date, the exercise has been a relative success. Annualized price growth has tempered during the past 21 months, the unemployment rate has remained near record lows and gross domestic product growth has been tepid at times but still positive. The path to a so-called soft-landing remains open.

Still, the Fed's monetary policy movements have been felt acutely by banks in the form of higher funding costs, mounting unrealized losses and a drop in demand for mortgages and other products. During the final Federal Open Market Committee meeting of 2023, Fed officials signaled that they were likely done hiking rates, with most members forecasting multiple cuts in the year ahead, but Powell said he is not ready to declare victory just yet, setting up for a pivotal 2024.

Powell's other balancing act comes on the regulatory front. Fed Vice Chair for Supervision Michael Barr is championing an ambitious agenda that includes more stringent capital rules and expanded long-term debt requirements for all banks with $100 billion of assets or more. The proposals were put forth over the summer despite objections from two Fed governors and questions from others.

Powell's task will be to balance Barr's congressionally-granted authority to set the Fed's regulatory agenda — something for which he has expressed strong support in the past — with the central bank's identity as a consensus-driven institution.

Along with open opposition from Govs. Michelle Bowman and Christopher Waller, the Fed's regulatory proposals must overcome questions from Vice Chair Philip Jefferson as well as Powell himself. Neither Powell nor Barr has called for unanimous support for the final rule, but it is rare for the Board of Governors to enact major reforms with more than two dissenting votes.

Efforts to tweak the frameworks to address concerns of individual governors and the broader public will take place behind closed doors, but for the rules to be put to a final vote, they will need Powell's blessing. —Kyle Campbell

Michael Rhodes

Incoming CEO, Discover Financial

When Discover Financial Services axed its CEO, Roger Hochschild, in August, the question across the payments world was: who would possibly want this job? Hochschild presided over the credit card company as a flurry of regulatory and compliance issues rained down.

The answer presented itself in December, when Discover chose longtime TD Bank executive Michael Rhodes for the CEO role. Most recently, Rhodes served as group head of Canadian personal banking at the Toronto-based bank, and before that, he led the North American credit card and merchant services division. He was also the head of innovation, where he used the pandemic's disruptions to slingshot TD's tech organization into new areas. Like Hochschild and many Discover executives, Rhodes is also an MBNA alumnus.

One unusual item on his resume: as Canadian banking head, Rhodes spearheaded a postal-banking test involving small-dollar loans for TD, which is one of a half-dozen major banks in the country. Could a similar idea work for Discover? Probably not, but his willingness to think differently could serve Discover well as he tries to steer it past its oversight problems. —Chana R. Schoenberger

Bill Rogers

CEO, Truist Financial

Al Drago/Bloomberg

Truist Financial faced mounting Wall Street pressure this year. Investors wanted the bank to prove that it was willing to make big changes to meet the financial targets that were set when the company was formed in 2019 by the merger of BB&T in Winston Salem, North Carolina, and SunTrust Banks in Atlanta.

Critics pointed to Truist's rising expenses, particularly at a time when the bank was supposed to be reaping the cost-savings benefits of the merger, as well as its dimming revenue projections.

By late summer, CEO William (Bill) Rogers Jr. was ready to start talking about the big changes he and his team would make to reduce costs and increase efficiency at the $543 billion-asset company.

In September, it vowed to trim expenses by $750 million over the next 12 to 18 months. Then it shrank the size of its board of directors from 21 to 13 and reduced the number of commercial and community banking regions by one-third. It also reworked its 11-member executive management team into a 21-person "operating council" and appointed a new chief operating officer.

Now the question is: will those actions in 2023 pay off in the form of an improved Truist in 2024? The company has said that it doesn't anticipate positive operating leverage in the first half of the year, but it does expect to keep expense growth to 1%, a decline from the 7% projected for 2023.

Rogers has said the changes are part of the evolution of Truist, not a pivot in strategy.

"Our merger was driven by [the idea of] let's merge and do no harm and I think that was really the right call," he said this month at an industry conference.

Now it's about "defining what the new Truist should look like," he added.

At the conference, Rogers said Truist is thinking about selling a portion of its underwater securities portfolio as a way to generate capital in a more demanding regulatory environment.

It may also decide to sell all or part of its remaining 80% stake in its insurance brokerage subsidiary as a way to generate capital. But if and how that shakes out is unclear.

"How and when we use that [option] will be determined by changes in market conditions," Rogers said. —Allissa Kline

Taylor Swift

Owner, Taylor Nation LLC

Photographer: Michael Tran/AFP

Taylor Swift is an economic force to be reckoned with. The performer's Eras Tour generated an estimated $5 billion for the U.S. economy, with concertgoers spending approximately $1,300 per show, according to the market research firm QuestionPro. The Federal Reserve Bank of Philadelphia credited Swift's tour for making May 2023 the city's strongest month for hotel revenue since the onset of the pandemic. And importantly for banks: Singapore's third-largest lender, United Overseas Bank, saw a sizable rise in debit and credit card applications across multiple countries as part of a promotion that allowed its cardholders to buy tickets to the pop star's Eras Tour 48 hours ahead of the general public.

In Singapore, Thailand, Malaysia, Indonesia and Vietnam, the deal led to a 45% rise in daily average credit card applications across those regions in the week Swift announced her concert dates, compared with earlier in June, UOB told Bloomberg News. Its debit card applications in Singapore and Vietnam rose by nearly 130%.

"If you have the UOB credit card, you have some advantage," UOB CEO Ee Cheong Wee said during the bank's third-quarter earnings call, according to a transcript.

This type of promotion isn't unique to Swift (UOB had a similar promotion this year with Ed Sheeran), but the superstar has demonstrated her influence in other ways, such as by getting more than 35,000 fans to register to vote by linking to vote.org on Instagram.

It's clear that Swift has a strong sway on her fans' behavior — and their spending. Banks that want to tap into the Swift fandom can follow UOB's example, or find their own way to partner with the pop star. —Daniel Wolfe

David Solomon

CEO, Goldman Sachs

Stefan Wermuth/Bloomberg News

Next year marks Goldman Sachs CEO David Solomon's sixth at the helm of the investment bank. It will also be the bank's second straight year getting rid of different parts of its consumer business, which it is jettisoning after substantial loss and struggling profitability.

The $1.6 trillion-asset bank already sold most of its Marcus loans in 2023, and in October, it sold GreenSky, a fintech specializing in home loans. In 2024, Solomon will be focused on exiting its buzzy but brief credit card partnership with Apple.

How Solomon chooses to reinvest the money and staff time once dedicated to its consumer unit will speak to the bank's revamped strategy. Goldman has announced plans to grow both its global banking and wealth management businesses moving forward.

"We are confident that the work we're doing now provides us a stronger platform in 2024 and beyond," Solomon said during the bank's third-quarter earnings call in October.

As the head of Goldman, Solomon is also slated to play a substantial role next year in the ongoing battle between regulators and the banking industry over proposed capital regulations. Solomon has previously taken issue with the proposals, saying they would reduce access to credit for small businesses and drag down the U.S. economy.

"The rules as proposed go way too far and do not account for the vast array of improvements made by the largest banks as a result of Dodd-Frank and other reforms," Solomon said in October.

The new year may also prove satisfying in another way for Solomon. The 61-year-old was among the first chief executives in the financial industry to call employees back to the office during the COVID-19 pandemic, insisting that in-office work is more effective. Now that firms nationwide have started requiring mandatory in-office days, it seems that many of Solomon's competitors agree with him. —Orla McCaffrey

Sandra Thompson

Director, Federal Housing Finance Agency

Bloomberg News

Sandra Thompson, the director of the Federal Housing Finance Agency, had the foresight to launch a review of the Federal Home Loan Bank system long before the consortium of private banks lent billions of dollars to First Republic Bank, Silicon Valley Bank and Signature Bank during the March liquidity crisis, resulting in the the second-, third- and fourth-biggest bank failures in history.

Thomson spent more than 23 years at the Federal Deposit Insurance Corp., including as director of risk management supervision, before joining FHFA in 2013. She has raised questions about the system's role as a "lender of last resort." In 2024, the FHFA will move to put in place up to 50 recommendations from its wide-ranging report, the "FHLBank System at 100."

Overseeing three government-sponsored enterprises is a monumental task, yet Thompson has managed to keep the far more contentious issue of Fannie Mae and Freddie Mac remaining in conservatorship on the back burner. FHFA is preparing the GSEs for life after conservatorship without putting hard deadlines in place.

Thompson also has pivoted the FHFA's focus toward addressing housing affordability, expanding credit offerings to first-time homebuyers and attempting to minimize homeownership disparities between racial groups through equitable housing plans.

In early 2023, the FHFA proposed a loan-level pricing adjustment fee that would have been based on a borrower's debt-to-income ratio. After getting flak from industry about the fee, Thompson rescinded it. —Kate Berry