Financial leaders discuss capital markets priorities at the 2025 Chatham Financial Client Summit

Economic outlook: resilience amid uncertainty

The summit opened with a discussion on the U.S. economic outlook, led by John Hilsenrath, Founder of Serpa Pinto Advisory and former Wall Street Journal economics editor, and Amol Dhargalkar, Managing Partner and Chairman at Chatham.

An informal poll revealed most attendees did not expect a recession by mid-2026, though concerns about consumer sentiment, delayed investment, and tariffs were prevalent. Dhargalkar highlighted the disconnect between market expectations and Federal Reserve policy, underscoring the challenges of forecasting in a volatile environment. Hilsenrath emphasized the economy’s resilience, citing strong consumer spending and fiscal stimulus, but warned of structural constraints on the Fed’s ability to cut rates. “I think we're in a more inflationary period, and because fiscal policy is so abnormal, I think the Fed is going to find it can't cut rates very much anymore. There are worries about the zero lower bound, and we're going to see this when they update their framework in a few months,” he said.

He also noted a shift in long-term rate management. “I think we're entering a period where the U.S. Treasury takes back oversight of the long end of the yield curve. [U.S. Secretary of the Treasury] Scott Bessent has said he wants a 3% long rate. It's flirting with 5%, and the u-shape of the yield curve suggests that the place you want to issue right now is in the middle.”

This shift, he suggested, will place new emphasis on Treasury issuance strategy. “I suspect that we're going into a period where we're going to be paying a lot of attention to the Treasury's quarterly refunding statements to see what they're going to do with the long-end bond issuance. My hunch is that they're going to concentrate this flood of issuance more on the middle and short end of the curve. I would want to get ahead of that if I were issuing.”

Hilsenrath concluded with a caution about future Fed leadership, suggesting internal resistance could complicate policy shifts.

Capital markets: the “Great Convergence”

Reuben Daniels, Managing Director of Investment Banking at Chatham, explored the structural forces behind what he called “The Great Convergence,” a shift in how capital is raised, priced, and deployed.

Daniels traced the evolution of capital markets from the creation of the Federal Reserve and SEC to the repeal of Glass-Steagall and the rise of mega asset managers. The 2008 financial crisis accelerated the shift, as private credit markets surged to fill the gap left by constrained banks. Insurance companies also began deploying capital through annuity-based models.

Today, Daniels explained, capital markets are fully converged. “Public and private capital, real estate and corporate finance, lending and advisory — they’re all blending.”

While banks remain essential for standardized capital, private credit is increasingly stepping in for more complex, bespoke deals. This new environment offers flexibility but introduces risks, including asset-liability mismatches and the back-leveraging of unregulated asset managers by regulated banks.

Daniels closed with a clear message for finance and treasury leaders. He said, “Stay informed, remain flexible, question assumptions, and lead with confidence. The capital stack may look more complex today, but the tools are familiar. It’s just about putting the pieces together in a way that works for your business.”

FX risk management: staying ahead of market turbulence

David Beaver, Global Treasurer of Crown Holdings, and Kyle Manchin, Vice President and Global Treasurer of Axalta, shared how they’re adapting to geopolitical risk, currency fluctuations, and shifting trade policies.

The guiding principle: “Don’t be surprised.” Treasury teams are building resilient FX programs, especially in emerging markets where devaluation risks are high. Panelists emphasized the importance of understanding volatility, aligning FX strategies with business goals, and collaborating across tax, accounting, and operations.

Tools like ChathamDirect are helping improve visibility and control. As one speaker noted, “Controlling the uncontrollable is how we operate.” FX risk management is now a strategic imperative.

Advanced hedging strategies: tools for a volatile world

With interest rate volatility rising, treasury teams are turning to advanced hedging strategies. Brian Frey, Vice President and Treasurer at Brunswick Corporation, and Zach Seymour, Assistant Treasurer at Sonoco Products Corporation, discussed how they use pre-issuance hedging and cross-currency swaps to manage risk.

Pre-issuance hedging enables companies to reduce interest rate risk ahead of debt issuance, smoothing volatility and improving predictability. Speakers emphasized layering hedges over time and aligning with accounting teams to ensure hedge accounting compliance.

Cross-currency swaps allow companies to create foreign-denominated debt synthetically, often at lower cost. However, they require careful planning due to credit risk, settlement timing, and accounting complexity. The session underscored the value of preparation and scenario modeling. Treasury teams that proactively engage with their boards, auditors, and advisors are better positioned to act quickly when market conditions shift. As one panelist put it, “We’re not trying to time the market; we’re trying to manage risk intelligently.”

M&A and treasury: strategic partners in deal success

As M&A activity rebounds, treasury’s role in deal execution and integration is more critical than ever. Mary Wienclaw, Director of Capital Markets and FX at Baxter International, shared lessons from recent divestitures and acquisitions, emphasizing the importance of planning, integration, and equipping new teams for success.

The session explored tools for bridging valuation and funding gaps, including seller financing, contingent value rights (CVRs), and deal-contingent hedging (DCH). While common in private equity, these tools are gaining traction among corporates seeking flexibility and downside protection.

Panelists stressed the value of competitive processes — not just for pricing, but for structuring favorable terms. Treasury’s ability to coordinate across legal, tax, and finance functions makes it a natural hub for deal execution.

Cash flow hedging: building and scaling robust programs

Designing a hedging program requires more than technical expertise; it demands alignment, data discipline, and clear objectives. Eric Frankberg, Director and Assistant Treasurer of Polaris, shared how the organization's treasury team developed robust cash flow and commodity hedging programs.

Throughout the interactive session, participants discussed how clarity of purpose is key. Whether the goal is to reduce earnings volatility or meet budget targets, aligning on objectives guides decisions around hedge ratios and instruments. Involving procurement, FP&A, and accounting teams early ensures feasibility.

Forecast accuracy and data quality are critical. Tools like ChathamDirect help improve visibility. Accounting considerations, from hedge designation to effectiveness testing, must be addressed in partnership with auditors.

As one participant put it, “You can’t hedge what you don’t know.” With the right foundation, treasury teams can build programs that manage risk and add strategic value.

As the global financial landscape continues to evolve, the 2025 Chatham Financial Client Summit reinforced the importance of adaptability, strategic foresight, and collaboration. Whether navigating capital markets, managing FX risk, or preparing for M&A, treasury leaders are playing a pivotal role in shaping resilient, forward-looking organizations.