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The four largest U.S. banks are on track to capture their largest share of industry profits in nearly a decade, a sign of how they are strengthening their dominant position in the market.
JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo are the four largest banks American banks Through deposits and assets, they collectively posted profits of about $88 billion in the first nine months of 2024, according to calculations by the Financial Times based on figures from industry tracker BankRegData.
Together, these banks account for 44 percent of US banking industry profits — the highest share for the first nine months of the year since 2015 — even though their group takes on more than 4,000 of the country's other banks.
Including US Bank, PNC and Truist, the seven largest banks by deposits generated nearly 56 percent of all banking profits in the first nine months of the year, up from 48 percent for the same period in 2023.
JPMorgan, Bank of America, Citi, Wells, US Bank and Trust declined to comment. The Palestinian National Council did not respond to requests for comment.
The data comes from earnings reported to the Federal Deposit Insurance Corporation, a banking regulatory body, and relates only to earnings reported by U.S. banking entities.
Banks can also include different business activities within the data they report, and larger banks e.g JP Morgan The BofA includes profits from investment banking and trading where many smaller banks do not compete.
While the numbers don't exactly match the profits banks offer investors, they show the growing importance of scale in the banking industry as it grapples with rising regulation, technology, marketing and operating costs. Large companies can spread these costs over a larger number of customers.
“Once you get much smaller than the largest banks, it becomes really difficult to make the necessary investments and have the same name,” said Chris Kotowski, a banking analyst at Oppenheimer.
“We're a very mobile society, especially since Covid. For example, a lot of people move from New York to Florida, so do you really need to have a different bank in Florida than you have in New York?”
The United States has an extraordinarily fragmented banking system, largely because consolidation was delayed by restrictions on interstate banking that were only lifted in the 1980s.
The dominant positions of the largest US banks have fueled calls for further consolidation among smaller banks in order to better compete.
Dealmaking has slowed in recent years, but there are hopes that the incoming Trump administration will adopt a more lenient policy.
Bob Diamond, the former head of Barclays who now runs an investment firm, told the Financial Times earlier in December that he believes the number of US banks could fall by more than half in the next three years.
But the major banks' main competitors are increasingly non-banks, including private credit companies, which offer bank-like services.
Financial institutions such as Apollo, Afirm, and Rocket Mortgage have become increasingly influential lenders to businesses, home buyers, and consumers, although this lending is often financed by banks.
In the mortgage market, nonbank companies now manage more than half of home loans in the United States compared to 11 percent in 2011.
In his annual letter to shareholders, JP Morgan CEO Jamie Dimon described the tech giant Apple as acting “effectively” as a bank by holding, moving and lending money.
