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America’s six largest banks added $600bn in market value in 2025, spurred on by the Trump administration’s push to deregulate the industry and a revival in investment banking.
The collective market capitalisation of the six biggest US banks by assets — JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley — rose to $2.37tn at the close of business on Tuesday, up from $1.77tn at the end of last year, according to data from S&P Global.
The six most valuable European banks have a market capitalisation of just $1tn combined, highlighting the gap that has opened since the financial crisis between US banks and their European rivals. The US banks are on track to outperform the broader S&P 500 for the second year in a row.
In the aftermath of the 2008 financial crisis, the biggest US banks were encumbered with regulations that made investors lukewarm about the sector. Those banks are now benefiting as the Trump administration starts to roll back many of the rules, however.
“You cannot underestimate how important this regulatory change has been to the stock prices,” said RBC banking analyst Gerard Cassidy. “The profitability of the industry was severely reduced because of the financial crisis because the banks had to bring on much more capital, deservedly so.”
So far this year, US regulators have proposed to allow higher leverage at the country’s largest banks, overhauled annual banking stress tests used to determine capital requirements and rescinded lending guidance for riskier loans.
Banks also anticipate that the final implementation of so-called Basel III Endgame global capital rules will be much less onerous than the initial proposal under the Biden administration in 2023.
“They’re all sitting on excess capital because they already built it up based on the other proposal,” said Cassidy.
Capital is in place to absorb potential losses but can also be used to fund business activities as well as for shareholder payouts such as stock buybacks and dividends.
Some opponents of lighter-touch regulation, such as Democratic Senator Elizabeth Warren, have voiced concerns about the scale of financial deregulation. But investors have so far shown little concern about any increase in risk-taking by the banks.
“It’s a risk that may come up down the line,” said Saul Martinez, head of US financials equity research at HSBC. “But given how little bank balance sheets have grown, there’s the sense that there is room to take more risk.”
Citi’s shares have been the best performing of the six large US banks, adding about 70 per cent in 2025 as a years-long effort to simplify the bank and cut costs has gained traction. This month the bank traded above the sum of its parts for the first time since 2018.
Goldman’s shares have also increased by almost 60 per cent during 2025, notching up record highs off the back of a recovery in its core business of investment banking that bankers expect to accelerate further in 2026 and an extended boom in trading.
Industry tracker Crisil Coalition Greenwich forecasts that industry-wide revenues at banks from both equities and fixed-income trading will also surpass previous peaks this year, with $92bn from equities trading and $163bn from fixed income.
“It almost feels a little too good to be true right now,” said Martinez. “The fundamental backdrop is good. I think the question is how much of it is priced in.”
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