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Few things have gotten as much attention on Wall Street as artificial intelligence (AI) over the last six months, but there is another theme that has been quietly developing: record profitability among the largest U.S. banks. Increased market activity, robust demand for loans, and a revival of investment banking have generated massive amounts of capital for banks, creating opportunities for hefty dividends and large-scale share repurchases.
JPMorgan Chase (JPM) is leading the way. After another quarter with record revenues and profits, the bank has decided to increase its quarterly dividend by 10% to $1.65 per share, subject to approval by its board of directors. The decision comes shortly after the success of the Fed's annual “stress test” and shows how healthy the balance sheet of the company is, raising questions about whether JPM stock will keep performing well after reaching all-time highs.
