A concise reference to help bank CFOs navigate today’s environment

Banking CFO Insights – 1Q

March 13, 2026

2026 outlook themes

In PwC's Banking CFO Insights, we provide broad coverage and a concise reference for CFOs navigating today’s banking environment. The outlook for 2026 provides a translation of market signals into the judgments that CFOs are being asked to make in real time. Here we’ll look at the key messages external stakeholders are focusing on at the start of the year.

Revenue growth, expense management and investments anchored to a disciplined approach

First quarter earnings will likely raise expectations for 2026 financial projections as analysts and investors parse which management teams are delivering clear, evidence-backed outlooks versus those who are still refining assumptions and milestones. Our evidence? An earnings call analysis showing that financial markets are probing for proof points that growth, discipline, and investment choices are coherent, measurable, and resilient.

PwC reviewed a sample set of January’s bank earnings call transcripts, bucketing analyst questions into overarching themes. We then ranked by the percentage of queries pertaining to each theme. While subjective, it was revealing. Analysts probed how strongly bank leaders adhered to their projections for business expansion, cost discipline, and/or investment priorities, as follows.

Quality and resilience of revenue growth (~30% of questions)
These questions focused on the reliability of revenue growth—where it’s coming from, how dependent it is on pricing versus volume, and whether it’s supported by mix and client behavior that can hold up across cycles. The emphasis was on executive confidence and resilience of the outlook, not short-term acceleration.
Expense flexibility and operating leverage (~25%)
These questions were rarely about absolute cost levels. Instead, analysts tested how variable the cost base truly is and whether productivity, automation, and efficiency efforts create financial capacity. Expense discipline is increasingly being evaluated as a funding mechanism for reinvestment rather than a defensive posture.
AI investment and execution (~15%)
The AI conversation is shifting from aspiration to inevitability. Analysts increasingly agree that meaningful change will be expensive, disruptive, and uneven. Questions focused on where AI is altering processes today, how much change the operating model can absorb, and what milestones signal that AI investment is translating into capability. Increasingly, management teams are positioning AI as an operating model redesign that can improve customer outcomes, risk management, and revenue enablement over time.

Taken together, analysts focused on durable revenue growth and expense flexibility reflecting a single, integrated line of inquiry: In the emerging age of AI-powered banking, are CFOs freeing up cash flow to invest in growth and are those investments beginning to translate into measurable operational capability and competitive differentiation? (For more on this issue, see this quarter's Spotlight topic: Revamping expense priorities to fuel growth). What changed this past earnings season was not the topics but the tone. Analysts are moving beyond pressure-testing individual assumptions to evaluating whether management can convert discipline into strategic capacity and repeatable execution. In that context, the market is evaluating CFOs on a small number of near-term decisions, not long-term narratives. The tone and framing of analyst questions and the results provide a useful proxy for where CFOs are being asked to go deeper, be clearer, or recalibrate expectations.

Quicker M&A transaction closing timelines

The change in large bank deal closing timelines is dramatic, falling by about 35% under the current administration. The median timeline from announcement to close was 148 days (or 4.9 months) for the 24 transactions last year involving bank targets with $1 billion to $25 billion in total assets, according to S&P Global Market Intelligence. That’s down from 227 days (or 7.6 months) for 14 deals of that size announced in 2023 under the prior administration. Shorter deal closing timelines can improve deal economics by accelerating synergy realization and reducing uncertainty, which may increase the attractiveness of select combinations where strategic and execution fit are strong. A compressed timeline increases the upside for well-prepared transactions while also increasing the downside risk if integration readiness is weak; placing greater weight on CFO-led diligence, execution planning, and early capital allocation decisions.

Regulatory priorities

Major regulatory capital and liquidity rule changes are coming. On March 12th, Vice Chair for Supervision Michelle Bowman previewed proposed changes to bank capital rules and communicated that the long-awaited re-proposal of "Basel III Endgame" will be released for comment soon. The Federal Reserve Board is expected to vote on the proposal during the week of March 16th. Further, changes to liquidity rules which would be proposed at a later date and separate from Basel III Endgame are widely expected given recent public statements from Bowman and Treasury Secretary Scott Bessent. Meanwhile, supervisory priorities now concentrate on issues that create “material financial risks” and impact safety and soundness. With a lower regulatory volume, CFOs can reprioritize expense capacity toward value-added investments in data, technology and financial performance management tools. Bank CFOs are also focused on emerging risks such as digital assets, non-depository financial institution lending, and regulatory expectations for new competitors with recently approved charters. Also top of mind is new rulemaking to implement the GENIUS Act and expand access to Fed payment systems while monitoring the debate over stablecoin yield. For CFOs, the takeaway is clear – ensure the reduced spending on regulatory needs is reinvested in growth and transformation initiatives while keeping a watchful eye on what is sure to be a landmark year for regulatory rulemaking. (Subscribe to PwC’s risk and reg publication Our Take for further details).

Spotlight topic: Revamping expense priorities to fund growth

The dominant conclusion the market is drawing from earnings season is that growth ambitions are more likely to be believed only if they are funded by disciplined, intentional expense choices. The expectation is that CFOs will reorient their view of an expense around the strategic value it provides.

Boards and investors increasingly ask a straightforward question: What are you stopping in order to fund what matters more? Expense management has become a proxy for credibility on the issue. CFOs who can increase investments to enable growth without sacrificing operating leverage are more likely to be rewarded.

How stakeholders view the issue
While investors are asking the question, they are not your only, and often not your primary, day to day stakeholder. Here’s a breakdown of how each of your stakeholder groups may react to this issue.

Employees: Interpreting expense actions as a signal of whether productivity gains will be reinvested in skills, tools, and career paths or extracted through blunt cost reduction, with implications for engagement and execution risk.
Customers: Watching closely whether cost discipline constrains service levels or product investment, particularly in areas where experience, speed, and reliability increasingly differentiate competitors.
Boards: Focused on whether management can clearly articulate explicit trade-offs. What is being deprioritized or exited to fund growth, rather than simply committing to margin or growth targets in isolation?
Investors: Evaluate expense discipline as evidence of sound management decision making, with preference for teams that convert efficiency gains into high-conviction investments in growth rather than diluting investment capacity over a wide set of businesses.

What’s our take for the CFO agenda?
Many effective narratives now frame expense management as a deliberate reallocation of spending capacity, not an exercise in cost reduction. The market is increasingly indifferent to how much expense is taken out in isolation. Instead, the focus is on whether CFOs are converting efficiency into deployable investment capacity and doing so in a way that strengthens the business over time.

Management teams that are resonating most clearly treat the expense base as a portfolio of trade-offs rather than a fixed constraint. They are explicit about what is being slowed, exited, or deprioritized to fund what matters more—technology modernization, data and AI enablement, talent, and selective growth initiatives. Without that linkage, expense discipline may read as defensive. With it, discipline signals a consistent process of reviewing the portfolio of expenses based on value to the business and strategy.

On the horizon

In addition to what we heard on earnings calls, there are several issues emerging that CFOs should watch.

Tax reform in 2026 and beyond: Beyond changes to reported tax rates, tax reform has the potential to return meaningful cash to the system through several channels. Some provisions may increase cash in the hands of consumers and businesses, influencing repayment behavior and loan demand. Other provisions may encourage capital investment and related financing activity. The market will be watching to see how these dynamics affect loan growth, balance sheet mix, and deployment of incremental cash.
Workforce transformation in the age of AI: AI is beginning to reshape roles, workflows, and productivity assumptions across banks, creating tension between efficiency gains and organizational risk. CFOs are navigating reskilling requirements, changing cost structures, and evolving control environments at the same time. The market may be watching for evidence that productivity improvements are being realized without undermining execution, culture, or risk management.
Finance technology modernization beyond AI: While AI dominates headlines, many banks are undertaking deeper technology platform upgrades, whether that’s the general ledger, enterprise systems, or data architecture. These large, multi-year investments are reshaping reporting, controls, and operating models. CFOs should enable these modernization efforts to translate into measurable ROI and durable efficiency gains.
Stablecoins and the banking model: Stablecoins are increasingly viewed not just as a payments innovation but as a longer-horizon balance sheet consideration. Even limited adoption could gradually influence deposit stability, pricing dynamics, and customer behavior over time; particularly as use cases expand beyond payments. CFOs should monitor whether these shifts begin to affect funding costs, liquidity management, or product strategy before impacts are visible in reported balances. For many institutions, the implications are strategic and forward-looking rather than an immediate driver of reported balances.

Closing Thought

The market is not asking CFOs to predict the future. It’s asking you to demonstrate control over the present, and to articulate a credible path forward. The CFOs who will stand out this year are those who can connect growth, discipline, and investment into a single, coherent capital allocation story grounded in realism rather than aspiration.

Contributors: Adam Davis, Christopher Tsingos, Dan Goerlich, Ashish Jain, Gregory Filce, Andy Cinko.