It’s a Good (Great?) Time to Be a Big Bank
The New York Times
The largest banks, including JPMorgan Chase, Wells Fargo and Goldman Sachs, reported bumper profits on Wednesday.
A swath of the nation’s largest lenders, including JPMorgan Chase, Wells Fargo and Goldman Sachs, reported quarterly and annual financial results on Wednesday that beat analysts’ expectations, and largely expressed a go-go attitude about what’s ahead for the economy after President-elect Donald J. Trump is inaugurated next week.
JPMorgan, the nation’s biggest bank, said it earned $14 billion in profits in the fourth quarter, and nearly $59 billion for the full year. Wells Fargo made $5.1 billion in the fourth quarter and $20 billion for the year and said wealthy depositors were plowing more money into its higher-end savings products. Citi, which also topped estimates, reported net income of $2.9 billion in the quarter and $12.7 billion for the full year.
Goldman Sachs, which saw fourth quarter profits of $4 billion and $14 billon for 2024, said it had particular success connecting risky companies looking for money to clients willing to lend it, typically a sign that credit conditions, as Wall Street puts it, remain fluid.
To some degree, the results were not a surprise: Bank stocks rose even faster than the broader market in 2024, which ended the year up 23.3 percent, as lenders took advantage of a hot stock market and pickup in corporate financing activity to fatten profits. Still, bankers traditionally cloak themselves as a risk-averse bunch, and given the questions about the future for interest rates, deal making and the geopolitical world, their optimism about what’s ahead is noteworthy.
Michael Santomassimo, Wells Fargo’s chief financial officer, said on a call with reporters that the bank’s corporate clients largely view the incoming administration as business friendly and pro-growth, potentially a boon for deal-making.
“It feels like many of our clients, or many of the market participants, feel more confident in their ability to execute on M&A transactions,” Mr. Santomassimo said. “There’s some optimism that we’ll see higher activity levels throughout the year.”
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