Wall Street’s top banks are toasting a record revenue haul this week, but industry chiefs also struck a note of caution after bumper profits were driven by market volatility.
JP Morgan led the pack with a net income of $16.5bn in the first-quarter of the year, up 13 per cent from the same period in 2025. Meanwhile, Goldman Sachs scored $5.6bn, an uplift of nearly a fifth.
Total net income for the big five Wall Street banks – JP Morgan, Goldman Sachs, Citigroup, Morgan Stanley and Bank of America – came in at just above $42bn.
Much of it was derived from revenue growth in equities trading divisions and investment banking, energised by the market frenzy triggered by the war in the Middle East.
At Morgan Stanley, equity revenue jumped by a quarter to $5.2bn whilst Citigroup’s shot up 40 per cent to $2.1bn, which the bank said was driven by derivatives and prime services.
But Goldman Sachs stormed ahead on this front. Its stock division broke revenue records, reaping $5.3bn for the first quarter.
Iran war boost Wall Street trading desks
The cash hauls come after markets were rocked by war in the Middle East. The attacks on Iran from the United States and Israel prompted investors to slash exposure to stock markets in a series of global sell offs. London’s FTSE 100 surrendered the 10,000 mark in the weeks that followed the outbreak of war at the end of February, falling by around eight per cent.
And so Goldman’s record came in febrile circumstances. It failed to excite nervous investors, even as it outstripped the famous bank’s previous revenue peak by a cool $1bn. Its own shares fell by around two per cent after the numbers hit dealing room screens.
Some of the selling likely tracked weakness in the fixed income division. Revenue there fell 10 per cent to just over $4bn after a slowdown in interest rate trading, mortgages and credit products.
But Axel Rudolph, chief technical analyst at IG, said the “bigger issue” is that Goldman’s results “feel like a snapshot of a world that may already be fading”.
“With oil prices surging, inflation fears building and recession risks creeping back in, the outlook for dealmaking and capital markets activity becomes far less certain.”
It was a sentiment echoed across top bank chiefs during the latest reporting season.
JP Morgan chief Jamie Dimon, often touted as the world’s most influential banker, warned: “There is an increasingly complex set of risks – such as geopolitical tensions and wars, energy price volatility, trade uncertainty, large global fiscal deficits and elevated asset prices.”
Citi chief: M&A not missing a beat
Bank of America chief Brian Moynihan said the firm remained “watchful of evolving risks,” though did add there was “healthy client activity” and a “resilient” economy.
Investment banking activity ramped up throughout the quarter, which was trailed by top bosses. Citigroup’s Jane Fraser – the only British chief on Wall Street – said in March corporate activity was “very strong at the moment”.
“Large cap M&A is not missing a beat right now,” she added.
Citi notched a record first-quarter in advisory revenue at $505m after advising on three of the largest M&A deals, including Paramount landmark takeover of Warner Bros.
JP Morgan’s investment banking fees jumped 28 per cent to $2.9bn, coming in around $260m higher than expected.
The US results precede similar action in London’s banking sector. The big four banks – Barclays, Natwest, Lloyds and HSBC – all release updates for the first quarter updates in the weeks ahead.
They are tipped to follow suit with a boom in activity on the market front, though the forward outlook is set to cloud the picture across the UK’s big-name quartet.
Rudolph said the caution of the likes of Dimon was “hard to ignore”.
“The economy may be holding firm for now, but the growing list of geopolitical and macro risks means the outlook is far from straightforward.”