US Banks Q1/2026: Start of a New Cycle

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Q1/2026 was a unique earnings season - not because of the numbers, but the surrounding context.

• Feb 28: Iran war erupts

• 6 weeks later: Strait of Hormuz blockaded

• Brent crude surges past $110/barrel - highest since 2022

  

• S&P 500 rallies to 7,000 in early January, corrects nearly 9% late quarter amid tech rotation wave, then reclaims highs in April

Amid that backdrop - naval warfare, surging energy, volatile tech markets - America's six largest banks sequentially reported Q1 results.

Results surprised Wall Street in the opposite way.

• All six banks beat market expectations

• Aggregate revenue hit $165 billion, up ~10% Y/Y

• Trading desks celebrated a legendary quarter: market revenue across five bulge-bracket banks totaled ~$41 billion - a record high

• M&A advisory roared back after two 'deal famine' years: Goldman Sachs +89% Y/Y, JPMorgan +82%, Morgan Stanley +74%

But the glossy surface masks a quiet structural shift.

Net Interest Income (NII) - the core, traditional revenue engine for US banks - just peaked this cycle.

• JPMorgan cuts 2026 NII forecast for first time, from $104.5 billion to $103 billion

• CFO Jeremy Barnum stated bluntly on the earnings call: “favorable factors are fading”

• Wells Fargo couldn't hold its margin: NIM shrinks to 2.5% - lowest among Big 4

• CFO Mike Santomassimo warned Q2 pressure will persist.

Meanwhile, fee-based revenues exploded. Morgan Stanley pulled in $118 billion in new assets to wealth management in one quarter - company's record quarterly inflow. Goldman Sachs CEO David Solomon called the M&A pipeline “extraordinarily robust.”

The common thread from CFOs, read closely:

Banks building sustainable 'fee engines' will keep expanding profits. Those reliant on traditional lending spreads face margin erosion over the next 12–18 months.

That's why Q1 2026 marks a pivotal quarter. In today's deep dive, Viet Hustler unpacks the Q1 story layer by layer for America's six largest banks.

1. US Banking Sector Q1/2026 Overview

2. 5 Biggest Trends This Quarter

3. Q1/2026 Earnings of 6 Major Banks

4. Bank Valuations: Framework & Key Insights

5. Is Banking Investable in the Current Macro Backdrop?

6. Investment Risks

7. Key Catalysts to Watch