Trump's "deregulation" push drives US bank stocks to increase by $600 billion in market value this year.
```
The Trump administration's push for financial deregulation and the revival of investment banking business has driven the combined market value of America's six largest banks to increase by $600 billion this year.
As of Wednesday's close, the total market value of JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs, and Morgan Stanley—the six largest U.S. banks—has exceeded $2.38 trillion, a significant increase from $1.77 trillion at the end of last year, and is set to outperform the S&P 500 index for the second consecutive year.
In contrast, the combined market value of the six largest European banks is only $1 trillion, highlighting the widening divergence between U.S. and European banking since the 2008 financial crisis.
A shift in regulatory policy has become the key factor driving stock prices higher. This year, U.S. regulators have proposed allowing the largest banks to increase leverage, fully reforming the annual bank stress tests used to determine capital requirements, and have rescinded guidance on lending for high-risk loans.
A strong recovery in investment banking business has further boosted market confidence. Citigroup’s stock is up more than 70% this year, leading the six major banks. Goldman Sachs’ stock has risen nearly 60%, hitting a historical high. Industry forecasts indicate that bank stock and fixed income trading revenue will exceed historic highs this year.
(Citi’s stock has surged more than 70% this year, leading U.S. big six banks)
Regulatory Easing Unleashes Capital Space
This year’s series of deregulation measures introduced by the Trump administration has directly boosted bank stock performance.
RBC banking analyst Gerard Cassidy said:
The importance of regulatory changes to stock prices cannot be underestimated. After the financial crisis, banks' profitability was severely weakened because they had to hold more capital, which was necessary.
More importantly, the banking sector expects the final implementation version of the Basel III global capital rules to be much looser than the initial proposal from the Biden administration in 2023. Cassidy noted:
They all hold excess capital because they had already reserved according to previous proposals.
This capital is not only used to absorb potential losses, but also for business expansion, as well as shareholder returns such as stock buybacks and dividends. Saul Martinez, U.S. financial stocks research director at HSBC, stated:
Given how slowly banks’ balance sheets are growing, the market believes there is still room to take on more risk.
Despite concerns from Democratic Senator Elizabeth Warren and other opponents about large-scale financial deregulation, investors have so far shown little anxiety about the increased risk-taking by banks.
The Gap Between U.S. and European Banks Continues to Widen
Citigroup has become the best-performing stock among America’s big six banks in 2025, with its share price rising about 70%.
The bank’s ongoing efforts to simplify its business and cut costs have paid off. This month, Citigroup’s stock price surpassed the sum of its divisions’ valuations for the first time since 2018.
Goldman Sachs' stock has also risen by nearly 60% this year, reaching a record high. This is thanks to the recovery of its core investment banking business and the continued boom in trading operations. Bankers predict that the recovery momentum of investment banking will further accelerate into 2026.
Industry tracker Crisil Coalition Greenwich predicts that this year, bank equity trading revenue will reach $92 billion and fixed income trading revenue will reach $163 billion, both surpassing previous peaks.
The growth in market value of U.S. banks further widens the gap with their European peers. Martinez commented:
The situation feels almost unreal now. The fundamentals are good, but the question is how much of this is already priced in.
Risk Advisory and DisclaimerMarkets carry risks; investment requires caution. This article does not constitute personal investment advice, nor does it consider the specific investment objectives, financial status, or needs of any individual user. Users should consider whether any opinions, views, or conclusions in this article are appropriate to their particular circumstances. Invest at your own risk. ```