The combined market capitalization of America's six largest banks has surged by $600 billion this year, driven by President Trump's deregulation agenda and a robust recovery in investment banking, sparking a broad financial rebound. According to S&P Global, JPMorgan Chase (JPM.US), Citigroup (C.US), Bank of America (BAC.US), Wells Fargo (WFC.US), Goldman Sachs (GS.US), and Morgan Stanley (MS.US) now boast a total market cap of $2.37 trillion—up from $1.77 trillion at the end of 2024. This marks a gain exceeding one-third in under 12 months. In contrast, Europe's top six banks collectively hold just $1 trillion in market value—a disparity rooted in years of uneven regulations.

With Trump rolling back post-crisis restrictions, US banks have shed constraints imposed after 2008, outperforming the broader S&P 500 for a second consecutive year.

**Deregulation Unlocks Expansion** The 2008 financial crisis birthed rules that slashed bank profitability through higher capital requirements, stricter lending standards, and stress tests. Now, Trump-era regulators are allowing major lenders to increase leverage, revising annual stress-test frameworks and scrapping high-risk lending limits.

"These regulatory shifts are pivotal for stock prices," noted Gerard Cassidy, RBC banking analyst. "Post-crisis profitability plunged as banks piled up capital—rightfully so. But with rules easing, the landscape is transforming."

The largest players, having stockpiled cash anticipating stricter Biden-era Basel III rules (now expected to be milder), sit on excess capital. Cassidy added, "This capital isn’t just a safety net—it fuels buybacks, dividends, and growth."

**Investment Banking Revival Propels Stocks** Citigroup leads the pack with a near-70% stock surge in 2025, as years of restructuring and cost-cutting pay off—its shares now exceed the sum of its business units' value for the first time since 2018. Goldman Sachs follows closely, up 60%, buoyed by resurgent dealmaking and trading.

Industry-wide, equities trading revenue is projected at $92 billion, with fixed-income hitting $163 billion—both record highs.

**Criticism and Investor Confidence** While Senator Elizabeth Warren warns of deregulation risks, investors remain unfazed. "Banks’ modest balance-sheet growth suggests room for more risk-taking," said Saul Martinez, HSBC’s US financials research head. "The fundamentals are strong—but how much is already priced in?"