Wall Street banks post record profits despite war in Iran and inflation

Five of the six largest U.S. lenders reported second-quarter results on July 14 with record or near-record profits, even as executives warned that war in Iran, inflation and stretched valuations were creating risks below the surface. JPMorgan Chase, Bank of America, Citigroup and Goldman Sachs all posted stronger-than-expected results, and Morgan Stanley was set to follow on July 15.

JPMorgan delivered the strongest headline numbers, with net income of $21.2 billion, or $7.70 a share, the highest quarterly profit in the bank’s history. Managed revenue rose 27% from a year earlier to $58.0 billion, equity markets revenue jumped 86% to $6.0 billion and total markets revenue reached $12.1 billion. Investment banking fees climbed 30% to $3.3 billion, the highest level since 2021, while JPMorgan raised its 2026 net interest income outlook to roughly $105.5 billion from $103 billion. Chief executive Jamie Dimon said the results reflected an “elevated level of market activity,” but he also warned of “geopolitical instability, persistent inflation, swelling sovereign debt loads, and stretched asset valuations,” which he said were “shifting below the surface like tectonic plates.”

Bank of America also posted a strong quarter, with net income of $9.1 billion, up 27% from a year earlier, on revenue of $31.6 billion. The bank said every business segment delivered double-digit net income growth and that return on tangible common equity reached 17.0%. Citigroup reported net income of $5.8 billion, or $3.15 per diluted share, on revenue of $24.8 billion. Citigroup planned a 12% increase in its dividend and a new $30 billion buyback plan.

Goldman Sachs posted net revenues of $20.34 billion and net earnings of $6.63 billion, or $20.98 a share, helped by equities trading, IPO activity, mergers and acquisitions and gains from private equity. Its Platform Solutions division remained a weak point, with revenue falling 64% to $221 million as markdowns hit the Apple Card loan portfolio Goldman is selling to JPMorgan. Across the industry, the quarter reflected unusually high volatility tied to the Iran war, a rebound in dealmaking, the SpaceX IPO and business and consumer activity despite higher-for-longer interest rates and inflation.

Analysts had expected major banks’ investment banking revenue to rise 26% and trading revenue to increase 14%.