U.S. banking history is about to be made as six major Wall Street banks are set to post trillion-dollar gains for the first time in a decade. According to a Bloomberg report, Wall Street, JPMorgan Chase, Bank of America, Wells Fargo, Citigroup, Goldman Sachs and Morgan Stanley combined have made nearly a trillion dollars in profits over the past decade.
At the beginning of this decade, banks It should be noted that they were facing a global defeat for their role in the 2008 global financial crisis. The United States government had to give billions of dollars to the banks to keep the banking sector from collapsing.
Various scandals and fraud cases have also forced these big banks to pay huge amounts of compensation and settlement fees.
Although everyone is expecting a slowdown in the banking sector, data compiled by Bloomberg shows that major Wall Street banks have made billions in profits, more than most publicly traded companies in the United States. Analysts are citing several reasons for this dream led by corporate banks.
In the year Following the financial fiasco of 2008, much of the focus was on Wall Street and the profits made by investors and companies. As investors and companies started making huge profits in the stock market, banks started getting a portion of their profits. Former US President Donald Trump’s decision to cut taxes has allowed banks to make billions in profits over the years.
The tax cuts announced by the Trump administration have helped banks increase their tax bills and increase their profitability. Major Wall Street banks, which made nearly 70 billion dollars in 2017, their income will go well above 120 billion dollars in 2018. A slight increase in interest rates and the high demand of retail banking has also helped banks to discover new arenas for profit.
As the government rolled out relief programs for consumers and businesses, the Covid-19 pandemic also impacted the performance of banks and the Federal Reserve bought trillions of dollars in assets. As Wall Street became volatile again, corporations and investors began to borrow more money from banks.
Mergers and acquisitions have become a trend in the market as strong entities try to buy out weaker competitors. In the year The profit in 2021 was helpful in accounting. The banks felt good about the economy, thanks to government intervention to release some of the reserves they had set aside in case of defaults on loans. The Big Six posted more profits in 2021 than in 2013 and 2014 combined.