For all of Wall Street’s excitement about Donald Trump’s growth agenda, the biggest banks are ending the Biden years on a high note.
The four giant lenders that reported full-year results Wednesday notched their second-most profitable year ever in 2024, trailing only Joe Biden’s first year as president. The group’s trading and lending revenue benefited from interest-rate moves, while investment banking fees jumped 32% from a moribund 2023 — with executives predicting that’s just the start.
JPMorgan Chase & Co. became the first bank in U.S. history to top $50 billion in annual profit. At Citigroup Inc., three of its five main segments — wealth, U.S. personal banking and services — posted record revenue for the year.
Of course, an extra earnings bump came in the fourth quarter as Trump’s election win and his policy hints set off market swings. But that wasn’t the only driver, as stronger-than-expected jobs numbers reset expectations for future rate cuts by the Federal Reserve.
Such flurries helped Goldman Sachs Group Inc.’s equities traders generate record revenue for the year. At JPMorgan, desks handling stocks and fixed-income products had their best fourth-quarter ever.
Meanwhile, corporate dealmaking picked up. Even Wells Fargo & Co., with the smallest Wall Street presence among the largest banks, boosted annual revenue from investment banking by a whopping 62%.
Many bankers were “dancing in the street” after Trump’s victory, JPMorgan Chief Executive Officer Jamie Dimon told CEOs at a global summit in mid-November. Executives had long bemoaned the Biden administration’s regulatory agenda, blaming it for making lending less profitable.
Now, the expectation among bank executives is that Trump’s watchdogs will ease off oversight, repeal some rules and pare back or drop a campaign to require too-big-to-fail lenders to hold more capital to buffer themselves against economic shocks.
And that means, after their 2024 windfalls, bank leaders have more confidence to boost shareholder payouts.
On Wednesday morning, shares of Citigroup staged their biggest jump since Trump’s victory after the firm unveiled plans to repurchase $20 billion of its stock in the coming years. That was despite the bank’s decision to lower its forecast for profit.