Big US banks add $600bn in value as deregulation spurs gains

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America’s six largest banks added $600 billion to market capitalization in 2025, driven by the Trump administration’s push to deregulate the industry and revive investment banking.

The collective market value of the six largest US banks by assets – JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley – rose to $2.37 trillion at the close of business on Tuesday, up from $1.77 trillion at the end of last year, according to data from Standard & Poor’s Global.

The six most valuable European banks have a combined market capitalization of just $1 trillion, highlighting the gap that has opened since the financial crisis between US banks and their European rivals. US banks are on track to outperform the broader Standard & Poor’s 500 index for the second year in a row.

In the wake of the 2008 financial crisis, the largest U.S. banks were burdened by regulation that made investors lukewarm about the sector. However, these banks are now benefiting as the Trump administration has begun to roll back many of the rules.

“You can’t underestimate how important this regulatory change is for share prices,” said Gerard Cassidy, a banking analyst at RBC. “Industry profitability has been severely reduced by the financial crisis because banks have had to bring in more capital, and they deserve to.”

So far this year, US regulators have proposed allowing higher leverage at the nation’s largest banks, reforming annual bank stress tests used to set capital requirements, and scrapping lending guidelines for riskier loans.

Banks also expect that eventual implementation of the so-called Basel III final global capital rules will be much less difficult than the initial proposal under the Biden administration in 2023.

“They’re all holding excess capital because they’ve already built it up based on the other proposal,” Cassidy said.

The capital is there to absorb potential losses but can also be used to finance business activities as well as shareholder payments such as share buybacks and dividends.

Some opponents of looser regulation, such as Democratic senator Elizabeth Warren, have expressed concerns about the extent of financial deregulation. But investors have so far shown little concern about any increase in risk appetite on the part of banks.

“It’s a risk that could come in the future,” said Saul Martinez, head of US equity research at HSBC. “But given how little growth there is in banks’ balance sheets, there is a feeling that there is room to take more risk.”

Citi shares were the best performers among the big six U.S. banks, adding about 70 percent in 2025, as years-long efforts to simplify the bank and cut costs gained momentum. This month, the bank traded higher than the sum of its parts for the first time since 2018.

Goldman Sachs shares rose nearly 60 percent through 2025, hitting record highs on the back of a recovery in its core investment banking business that bankers expect to accelerate further in 2026 and an extended boom in trading.

Industry tracker Crisil Coalition Greenwich expects that industry-wide revenue at banks from both equities and fixed income trading will also surpass the previous peak this year, with $92 billion from equity trading and $163 billion from fixed income.

“It seems too good to be true right now,” Martinez said. “The fundamental background is good. I think the question is how much is priced in?”