There’s a familiar setlist behind every serious banking conversation: capital, M&A, deposits, culture, succession. This roundtable plays all the hits.
Brian Love, Head of Banking & Fintech at Travillian, and co-moderator Matthew Shields, Managing Director and Head of FIG Capital Markets at Performance Trust Capital Partners, sit down with Michael Howard, Chief Investment Officer of the AllianceBernstein Financial Services Opportunities Fund, and Joe Chybowski, President & Chief Financial Officer at Bridgewater Bank, a $5.5 billion Minnesota institution. With the community bank capital markets open again across debt, preferred, and common, the roundtable digs into the question facing every management team in 2026: what separates the banks that can capitalize on this market from those that can’t?
Across the conversation, the roundtable covers five topics always of interest to bank leaders:
- Capital structure: how banks choose between debt, preferred, and common equity, and why optionality matters
- What investors reward: track record through the cycle, owner-operator alignment, and TBV/EPS growth
- Bank M&A: why the deal math is penciling again as rate marks fade
- Deposits: the franchise’s lifeblood, and the case for a Chief Deposit Officer
- Culture and succession: building credibility as a long-term asset
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Thinking through your own talent or succession strategy? Reach out to Brian Love to start the conversation | blove@travilliangroup.com
Episode Breakdown: Capital, M&A, Deposits, and Investor Confidence in 2026
00:21: A New Chapter for Community Banking
Brian opens by framing the shift: the industry has moved from defense — deposit competition, rising rates, regulatory scrutiny — back toward growth. But this isn’t 2021, and investors are rewarding disciplined execution over ambition.
01:19 | Meet the Panel: Three Seats at the Table
Brian introduces co-moderator Matt Shields of Performance Trust for the capital markets view, Michael Howard of AllianceBernstein for the investor view, and Joe Chybowski of Bridgewater Bank for the operator’s view. Matt notes that access to capital for banks of all shapes and sizes has been swirling of late.
02:21 | What Separates the Banks That Can Capitalize
Joe’s answer is immediate: credibility. The number one question investors ask is what’s the use of capital — and while that credibility is built over years, it can be eroded very quickly.
03:35 | Bridgewater’s Capital Story, 2005 to Today
Joe traces the arc from founder-led, just-in-time raises to private equity in 2015 and an IPO in 2018. The turning point was bringing in outside investors, which forced the capital raising process to become far more thoughtful.
04:22 | Debt, Preferred, or Common? Inside the Boardroom
Matt asks how the executive team and board actually decide between instruments when every market is open at once. Joe’s answer is optionality — everything stays on the table, because the market can turn in six months.
06:21 | Why Bridgewater Still Hasn’t Raised Common Equity
Despite growing at a mid-teens clip since going public, Bridgewater has never raised common equity — not by choice, but by market timing. Instead they took subordinated debt in 2020 during Covid uncertainty and preferred equity in 2021 when spreads were tight.
07:19 | The Pulse of the Market
Michael reads the tape: bank IPOs, private placements, and PIPEs in the common equity space, with debt markets wide open. Markets are as accessible as they have been in five or six years.
08:02 | What Makes a Bank a Viable Investment
Michael lays out his screen: an empirical track record across the rate and credit cycle, and the ability to compound value for shareholders over time. Just as important are owner-operators — management teams and boards that think like shareholders because they are shareholders.
09:12 | The Culture Question
Brian raises Bridgewater’s distinctive culture: an average employee age in the low 30s and an unmistakably entrepreneurial vibe. Joe confirms it is living and breathing — and deliberately not dependent on any one person.
10:15 | Everybody’s an Owner
Bridgewater grants stock deep into the organization, a model Joe likens to the Hy-Vee grocery chain. Management and the board own 20% of the company, which means the team is as incentivized as anyone to maximize shareholder value.
11:34 | Running the Math on Dilution
Matt notes that management teams with real skin in the game run the math quarterly, not opportunistically. Open markets don’t make debt or equity the right answer — the question is always which instrument serves the strategy with the least dilution.
12:33 | “We Get Paid to Be Paranoid”
Brian asks Michael what’s making him nervous in an otherwise positive market. Michael’s concern level is low — the industry looks healthy and profitable — but he offers the line that defines the episode.
13:09 | Why Community Bank Valuations Still Look Cheap
Michael argues that banks under $10 billion in assets are inexpensive relative to their own history and very cheap relative to the broader market. The industry fought the credit and capital battle for two decades after the financial crisis, then got hit by rates and liquidity in 2023.
13:59 | The Deposit Game and What’s Around the Corner
If anything keeps Michael up at night, it is deposits and technology — stablecoins, AI agents squeezing spreads. But he is measured: Bill Gates called banks dinosaurs in the late ’90s, and community banks that serve customers well still earn a positive deposit spread.
14:53 | The C&I Question and Staying in Your Lane
Joe addresses the recurring investor critique that Bridgewater doesn’t do enough C&I. His answer is discipline — the real risk is a bank chasing a new asset class and pivoting away from what made it great.
16:10 | Organic Growth First
At $5.5 billion, Bridgewater has completed just two small acquisitions totaling $350 million in assets. They could grow through M&A, but they wake up and grow organically — and M&A only earns a look if it is additive to the story.
16:44 | The Case for Consolidation
Michael calls 4,500 banks a bizarre remnant of federalism when Canada has roughly six. There is a long runway of common-sense consolidation ahead, and the industrial logic of well-executed M&A is strong.
17:52 | Two Camps of Investor Skepticism
The first camp is cynical by default — convinced every deal and every capital raise exists so the CEO can get paid more, chart in hand. The second camp simply didn’t like the numbers.
18:19 | Why the Deal Math Is Penciling Again
Rate marks from the 2022–23 vintage forced acquirers to take significant tangible book value dilution, and TBV and EPS growth are the metrics that matter most to bank investors. The further the industry gets from that period, the smaller the dilution and the faster the earnbacks.
20:10 | The Market Is Warming to Bank M&A
Several all-cash deals have been announced this year, and acquirers haven’t been penalized the way they once would have been. Michael reads that as a new, more open-minded investor constituency returning to the space.
20:32 | Has Anyone Cracked the Deposit Code?
Brian asks whether any banks have solved deposit generation. Michael declines to name names but offers the thesis: the value in banking is created on the right-hand side of the balance sheet, by taking good care of customers.
22:31 | Why Bridgewater Has a Chief Deposit Officer
Bridgewater created the role in 2018 to signal, internally and to the market, that deposits are the lifeblood of the institution. Lisa Salazar held the seat first; Katie Klug holds it today.
23:17 | Nine Branches, One Concentrated Market
Bridgewater runs $5.5 billion across just nine branches in a Twin Cities market where U.S. Bank and Wells Fargo control 65% of deposits. Consolidation has left it the largest locally led bank in Minnesota — which Joe sees as the opportunity.
24:23 | Niches to Riches
There is no silver bullet on deposits, only a constant battle fought through niches. Joe’s throughline: human connection, plus technology that can compete with the largest banks in the country.
25:04 | Succession, From the Investor’s Chair
Michael ties succession back to the owner’s mentality — a broad-based incentive structure builds the bench. Then he offers an answer Brian doesn’t expect: sometimes the successor is another bank.
26:34 | Bridgewater’s Live Succession Test
With Mary Jane Crocker moving to the board and co-founder Jeff Shellberg retiring in October, Bridgewater elevated three internal leaders to a seven-person leadership team in 12 months. Joe’s take: succession can’t be an org chart in a drawer, and sometimes you go outside the fence — as they did for both Chief Deposit Officer and Chief Technology Officer.
29:06 | Scenario Planning From the Capital Markets Seat
Matt explains how Performance Trust stress-tests a bank’s strategy across rate scenarios — up 200 basis points, down 200 basis points. If credit stays benign and valuations hold, the capital to fund those strategies will be there at reasonable levels.
29:58 | Predictions for the Next 12 Months
Matt expects more of the same: a robust market for capital raising and M&A. Michael sees more deals announced in the second half than the first and continued appreciation in community bank stocks, while Joe returns to dynamic, scenario-based planning.
32:47 | Closing: Movie Picks
Brian closes with his favorite fast question. Joe goes with Braveheart and the underdog story of the Scots, Matt with Princess Bride and Goonies.
