Major US banks posted robust earnings in the fourth quarter of 2025, buoyed by growing demand from borrowers, a development that analysts say could bode well for lenders’ future profitability, Reuters reports.
According to company filings and statements reviewed by Reuters, Bank of America saw its average loans grow by eight per cent compared with the same period last year. Its net interest income, the difference between earnings from loans and payments on deposits, surged to a record $15.9 bn. At rival JPMorgan Chase, average loans increased by nine per cent over the year, reflecting strong lending activity across both consumer and commercial segments.
“We’ve seen growth in all of the consumer borrowing categories,” Bank of America Chief Financial Officer Alastair Borthwick told reporters during a conference call. “That’s helped us in Q4, but generally, the story in 2025 was more of a commercial borrowing story, and we’ve been gratified by the fact that our clients in a growing economy have continued to invest to support their businesses.”
Analysts at S&P Global Market Intelligence highlighted that this trend is likely to continue into 2026, driven by macroeconomic stability and favourable lending conditions.
In a report issued on Tuesday, they noted that loan growth across US banks accelerated significantly by the end of 2025, rising 5.3 per cent year-on-year.
Citigroup also reported strong lending performance, with average loans climbing seven per cent in the fourth quarter, largely driven by its markets division and US personal banking services. Wells Fargo recorded a twelve per cent growth in commercial loans during the same period, while revenue also rose from auto and credit card lending. Wells Fargo Chief Financial Officer Mike Santomassimo emphasised that the pace of loan growth picked up for the first time in several quarters.
Executives across the US banking sector also raised concerns over the potential impact of President Donald Trump’s proposed ten per cent cap on credit card interest rates. Citigroup Chief Financial Officer Mark Mason said it was too early to fully assess the policy’s effect due to insufficient details but warned that an interest rate cap could restrict access to credit for those who need it most and negatively affect the broader economy.
An equally important issue for banking leaders is the independence of the Federal Reserve. Mason stressed that it is crucial for the Fed and its chair to operate without political interference, noting, “We’d expect that the next Fed chair operates with the same level of independence and focus on ensuring that the Fed has that independence.”
Despite the positive earnings reports, the S&P 500 banks index declined by about one per cent in early trading on Wednesday, reflecting market caution as investors weigh the implications of regulatory proposals and broader macroeconomic trends.
The performance of US banks in the fourth quarter demonstrates the continued resilience of the sector, supported by both consumer and commercial lending growth, and highlights optimism among investors regarding prospects for 2026, according to Reuters.
