Top 25 global banks add 5.4% market value in Q2 2024, says GlobalData
The top 25 global banks increased their market cap by 5.4%, reaching $4.11 trillion by Q2 2024. This growth was driven by positive global economic trends, with China Construction Bank and HDFC Bank leading the way.
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HDFC Bank's market cap rose by 17% to $154.4 billion, placing it 10th, while ICICI Bank increased by 11.5% to $102.7 billion. JPMorgan Chase remained the most valuable bank. Investor optimism is supported by anticipated Fed rate cuts and GDP growth projections.
“Investor optimism is bolstered by the anticipated interest rate cut by the Federal Reserve in September 2024. The US economy has shown resilience, with GDP growth rising to 2.5% in 2023 from 1.9% in 2022 and projected to grow by 2.1% in 2024, despite a Q1 2024 GDP dip to 1.4% from 3.4% in Q4 2023,” Murthy Grandhi, Company Profiles Analyst at GlobalData, said.
“The Federal Reserve’s projected 2.1% GDP growth for 2024 suggests a soft landing, with inflation nearing the 2% target. Investors remain optimistic about banking stocks as stable central bank rates help ease net interest margin pressure. A robust economy and improved lending conditions could stabilize net interest income for banks.”
China Construction Bank (CCB) : China Construction Bank (CCB) experienced a 21.8% stock surge in Q2 2024. This was driven by a strong capital position and attractive valuations. In Q1 2024, CCB reported significant growth with a CNY1.17 trillion increase in loans and advances, and a CNY1.71 trillion rise in customer deposits, highlighting its robust financial performance.
HDFC Bank: Market value grew 17% in Q2 2024, reaching $154.4 billion. Strong results and investor optimism are key factors, with an improved loan mix enhancing profitability.
JPMorgan Chase: Consolidated its leading position with a 9% increase in net revenue, driven by a rise in net interest income and asset management fees.
TD Bank: Market cap dropped 9.6% to $96.7 billion due to a probe into money laundering and a canceled acquisition.
Chinese Big Four Banks: Experienced growth between 3% and 22%, despite declining net interest margins from lower rates.
The second half of 2024 will depend on economic conditions, monetary policies, and inflation. Geopolitical factors, such as trade tensions, may impact operations and stability. Regulatory scrutiny, like that affecting TD Bank, could influence strategies and performance. Despite challenges, potential interest rate cuts, economic resilience, and technological advancements are expected to benefit global banks.
