In this piece, we will take a look at the 20 most profitable banks in the US in 2024. If you want to skip our coverage of the latest news in the US banking industry, then you can take a look at the 5 Most Profitable Banks in the US in 2024.
The US banking industry of 2024 is quite different from what consumers, analysts, and investors were used to before the onset of the coronavirus pandemic in 2020. Before the pandemic, interest rates were moderate and stood between 1.50% and 1.75% enabling banks to lend money to each other. However, after COVID-19 forced governments to shut down factories, hospitality establishments, and other business avenues, the rates were cut to nearly 0% in order to ensure that some economic activity remained and the drop in output was compensated to an extent by easy capital.
However, as they say, there's no such thing as a free lunch, the inflationary surge after the lax monetary policies of the pandemic era has now resulted in interest rates eclipsing levels just before the Great Recession of 2008. Since banks are involved in the business of money, higher interest rates tie in quite closely to their operations. Generally, while consumers bemoan higher rates, banks are happy as they are able to widen their 'spread' and make more profits even if borrowing is dropping due to tighter monetary conditions.
Additionally, higher rates can also mean that banks find it difficult to manage their asset base, which is often another term for the funds that the banks have invested in securities such as bonds. Should rates fluctuate too much, then these securities have to be revalued, and the resultant losses can drive some of the biggest banks out of business. This became clear last year in the US banking crisis of 2023, and you can find out more details about it by reading Top 20 Most Profitable Banks in the World.
Fast forwarding to 2024, April 2024 is seeing the start of the first earnings season of the year for US banks. Some of the biggest names in the US banking industry, The Goldman Sachs Group, Inc. (NYSE:GS), JPMorgan Chase & Co. (NYSE:JPM), Morgan Stanley (NYSE:MS), Bank of America Corporation (NYSE:BAC), The Bank of New York Mellon Corporation (NYSE:BK), and The PNC Financial Services Group, Inc. (NYSE:PNC) are out with their latest financial results.
Starting from Goldman Sachs since it has been one of the most troubled US banks as of late, its first quarter of 2024 results marked somewhat of a turnaround. Since the result, Goldman's shares are up by a cool 3.7% since its latest earnings results, and at the heart of this is Goldman's revitalized investment banking division that turned analyst expectations of a turnaround in deal making right. The bank's investment banking fees jumped by a whopping 32% in its latest results to stand at $2.08 billion. At the same time, Goldman's consumer banking division also reported a 24% growth in revenue, for a nice breath of fresh air after years of costly losses and write-downs.
Another record setting bunch of financial results in the US banking industry came from the New York City based The Bank of New York Mellon Corporation (NYSE:BK). Its first quarter earnings saw the bank post a respectable $4.53 billion in revenue, a modest figure when we consider banking behemoths the likes of JPMorgan Chase & Co. (NYSE:JPM). While we'll get to JPMorgan in a bit, BNY's latest quarterly revenue of $4.53 billion was the highest in its 240 year history. Not only did BNY's revenue beat analyst estimates of $4.39 billion, but its net income of $953 million and earnings per share of $1.25 also beat analyst estimates of $890 million and $1.19, respectively.
However, as you might know, an earnings beat is not a guarantor of favorable share price performance after the earnings results. This was also true in the case of JPMorgan, whose $42 billion in revenue and $13.4 billion in net income were unable to prevent a 6.5% share price drop on the day of the earnings report. So why did JPMorgan's shares fall? Well, the US bank's net interest income dropped by 4% sequentially, a higher delinquency rate for the consumer banking division, and a disappointing decision to keep 2024 interest income guidance unchanged in the face of some quarters expecting an upward revision.
On the last bit, here's what JPMorgan Chase & Co. (NYSE:JPM)'s chief financial officer Jeremy Barnum had to say during the accompanying earnings call:
Our total NII guidance remains approximately $90 billion, which implies a decrease in our Markets NII guidance from around $2 billion to around $1 billion. The primary driver of that reduction is balance sheet growth and mix shift in the Markets business. And as a reminder, changes in Markets NII are generally revenue neutral. Our outlook for adjusted expense is now about $91 billion, reflecting the increase to the FDIC special assessment I mentioned upfront.
With these details in mind and as the US bank stock earnings season kicks off, we decided to take a look at the most profitable banks in the US. Some notable names are Bank of America Corporation (NYSE:BAC), JPMorgan Chase & Co. (NYSE:JPM), and Wells Fargo & Company (NYSE:WFC).
20 Most Profitable Banks in the US in 2024
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Our Methodology
To make our list of the most profitable US banks, we ranked the 50 most valuable US banks market cap wise by their latest trailing twelve month net income and picked out the banks with the greatest profits.
KeyCorp (NYSE:KEY) is an American bank headquartered in Cleveland, Ohio. It serves the needs of both consumers and businesses. Heading into its earnings release in the third week of April, previous financial performance has been a bit mixed as KeyCorp (NYSE:KEY) has beaten analyst EPS estimates in just two out of its four latest quarters. It joins JPMorgan Chase & Co. (NYSE:JPM), Bank of America Corporation (NYSE:BAC), and Wells Fargo & Company (NYSE:WFC) in our list of the most profitable US banks.
Ally Financial Inc. (NYSE:ALLY) is a sizeable US bank headquartered in Detroit, Michigan. The bank was out with some great news for investors in April 2024 as ahead of its latest earnings call, Ally Financial Inc. (NYSE:ALLY) announced a 30 cent dividend on its common stock and an $11.75 dividend on its preferred shares.
East West Bancorp, Inc. (NASDAQ:EWBC) is a California based bank that provides products such as accounts and letters of credit. Out of the 13 analysts covering its stock as of April 2024, six have rated the shares as Hold and the remainder are split 4:3 between Buy and Strong Buy.
Citizens Financial Group, Inc. (NYSE:CFG) is a Rhode Island based bank catering to the needs of industrial, commercial, and other users. As the investment banking environment appears to be loosening up a bit in the US, it made a key shift in April 2024 by appointing a former Morgan Stanley executive as its head of wealth management.
Huntington Bancshares Incorporated (NASDAQ:HBAN) is an Ohio based diversified regional bank with close to twenty thousand employees. Its investors were in for some great news in April 2023 when Jefferies upgraded the shares to Buy from Hold and set a $16 share price target for the bank on the back of new business lines and markets.
With a headcount of nearly 43,000 State Street Corporation (NYSE:STT) is also one of the biggest banks in the US apart from also being one of the most profitable American banks. Its latest financial results saw the US banking behemoth beat analyst revenue and miss EPS estimates by posting $3.13 billion and $1.37 in the segment, respectively. State Street Corporation (NYSE:STT) also shared that as of Q1 2024, its assets under management of $4.34 trillion were at a new record level.
Fifth Third Bancorp (NASDAQ:FITB) is an Ohio based bank that works with governments, customers, and small businesses. The shares are rated Buy on average, and the average analyst share price target is $39.13.
M&T Bank Corporation (NYSE:MTB) is a New York state based bank that serves the needs of businesses, the wealthy, and regular customers among others. Its shares surged by more than 5% after the first quarter earnings, as management was eager to stress that it was continually reducing exposure to America's troubled commercial real estate market.
12. The Bank of New York Mellon Corporation (NYSE:BK)
Trailing Twelve Month Net Income: $3 billion
The Bank of New York Mellon Corporation (NYSE:BK) is a sizeable New York City based bank with more than fifty thousand employees. A centuries old bank, its history didn't hold it back during the latest earnings that saw The Bank of New York Mellon Corporation (NYSE:BK)t a record quarterly revenue in more than two hundred years.
Capital One Financial Corporation (NYSE:COF) makes loans, provides credit and debit cards, and has other banking products in its portfolio. Ahead of its upcoming earnings, the shares are rated Buy on average, and the average analyst share price target is $151.07.
The Charles Schwab Corporation (NYSE:SCHW) is one of the most well known banks in the US particularly due to its savings and loan business. Following its latest earnings results, the shares soared in April 2024 after the bank shared that its net interest margin, or the dollars it earns in interest over the amount it spends as costs, will increase during the year.
U.S. Bancorp (NYSE:USB) has more than 75,000 employees and is headquartered in Minneapolis, Minnesota. While some banks are focused on dealmaking in 2024, U.S. Bancorp (NYSE:USB) is focusing on making loans to energy companies and is one of America's 30 biggest liquidity suppliers to the energy sector according to Bloomberg's data.
8. The PNC Financial Services Group, Inc. (NYSE:PNC)
Trailing Twelve Month Net Income: $5.5 billion
The PNC Financial Services Group, Inc. (NYSE:PNC) is a Pennsylvania based bank that serves the needs of regular customers, companies, and retirees. Its first quarter earnings results were a disappointing bunch of figures that saw The PNC Financial Services Group, Inc. (NYSE:PNC) miss analyst revenue estimates of $5.19 billion by posting $5.15 billion in the segment.
Citigroup Inc. (NYSE:C) is the biggest bank on our list so far with more than 200,000 employees. Its first quarter earnings saw profit drop by 27% annually, but its earnings per share of $1.58 beat analyst EPS estimates.
The Goldman Sachs Group, Inc. (NYSE:GS) is a sizeable investment bank and wealth manager headquartered in New York City. The latest set of financial results marked a positive change that saw The Goldman Sachs Group, Inc. (NYSE:GS) finally report a turnaround in its consumer banking division and benefit from a surge in Wall Street's deal making.
Bank of America Corporation (NYSE:BAC), The Goldman Sachs Group, Inc. (NYSE:GS), JPMorgan Chase & Co. (NYSE:JPM), and Wells Fargo & Company (NYSE:WFC) are some of the most profitable banks in America.
