Wall Street "dances" to welcome Trump! Large American banks end the Biden era with the second highest profits in history.

Despite Wall Street's excitement over President Trump's growth plan, the major banks have ended Biden's presidency on a high note. Notably, the four banking giants that announced their annual performance on Wednesday achieved the second-highest profit level in history in 2024, second only to Joe Biden's first year as president. The big banks benefited from trading and loan income due to interest rate changes, and investment banking fees grew by 32% compared to the slump in 2023 - executives predict this is just the beginning. JPMorgan Chase became the first bank in U.S. history to exceed $500 billion in annual profit. Three of Citigroup's (Citigroup Group) five major divisions (Wealth, U.S. Consumer Banking, and Services) achieved record-high annual revenues. Of course, the additional revenue growth in the fourth quarter was driven by Trump's election victory and his policy implications causing market volatility. However, this was not the only driving factor, as better than expected employment data reset expectations for future rate cuts by the Federal Reserve. The four major banks' profits surpassed $100 billion for the second time. Such frenzy helped Goldman Sachs Group, Inc.'s traders generate record-breaking revenue this year. JPMorgan's department dealing with stocks and fixed-income products had the best fourth-quarter performance ever. Meanwhile, corporate trading activities have also increased. Even Wells Fargo & Company, the smallest of the largest banks on Wall Street, saw a significant 62% increase in annual revenue in its investment banking business. JPMorgan Chase CEO Jamie Dimon told CEOs at a global summit in mid-November that many bankers were "dancing in the streets" after Trump's election victory. Executives have long been critical of the Biden administration's regulatory agenda, accusing it of lowering loan profits. With Trump back, the CEOs of major banks made some farewell remarks on Wednesday to the outgoing government. David Solomon of Goldman Sachs Group, Inc. told analysts, "The mood of corporate leaders has changed. It feels like we're heading into a tailwind in 2025." He expects discussions with regulatory agencies to be more "constructive" and criticized the Federal Reserve's pressure tests on lenders, calling their results "incomprehensible" to them. Dimon said authorities must strike a balance between economic growth and bank safety. He said this is to establish "transparent, fair, comprehensive, and data-driven rules." Now, bank executives expect Trump's regulatory agencies to relax oversight, repeal some rules, and reduce or abandon the movement requiring "too big to fail" banks to hold more capital to cushion economic shocks. This means that with the unexpected windfall of 2024, bank management will be more confident in increasing shareholder dividends. On Wednesday morning, Citigroup announced plans to repurchase $20 billion worth of stock in the coming years, despite lowering profit expectations, its stock price saw the largest increase since Trump's victory.