In this article, we will take a look at the 8 most profitable bank stocks to buy according to analysts.
The US Banking Industry: Expectations from the New Admin
Financials is one of the sectors being deemed as winner post Trump’s victory with investors betting on looser regulation and higher M&A activity. Goldman Sachs CEO David Solomon pointed to the optimism in the environment, saying:
“There has been a meaningful shift in CEO confidence, particularly following the results of the US election”
Yahoo reported that Gabelli Funds portfolio manager Mac Sykes thinks that the deregulation will benefit the banks and that he forecasts lighter oversight of the banking market as a catalyst for the group.
While many are looking forward to the possibility of finally being able to make acquisitions in the financial space under the new US admin, UBS CEO Sergio Ermotti joined CNBC and stated that he doesn’t think there is going to be a lot of deregulation. Rather, he sees a rationalization of the existing banking regulation, which he thinks is appropriate for big banks that shouldn’t be ‘massively deregulated’. Simultaneously, he sees consolidation allowed in the US among second-tier banks.
At the same time, Bank of New York Mellon CEO Robin Vince is more optimistic about Trump’s return to the White House in terms of the impact on the financial sector. As he joined Yahoo Finance at the 2025 World Economic Forum, he was not that concerned regarding the risks tied to potential loose regulation. He stated:
“To see a government that’s really focused on growth and being able to make the economy everything that it can be, because ultimately, as one of America’s leading banks, we are focused on helping our customers to be able to grow and thrive. You know, that’s what our platforms are all about”
With that being said, let’s move to the 8 most profitable bank stocks to buy according to analysts.
A person using a mobile device to access their bank account information.
Our Methodology:
In order to compile a list of the 8 most profitable bank stocks to buy according to analysts, we used stock screeners to shortlist bank stocks with over $1 billion TTM net income. Moving on, we shortlisted the top 8 stocks from our list which had the highest average upside potential, as of February 3. The 8 most profitable bank stocks to buy according to analysts have been arranged in ascending order of their average upside potentials.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
8 Most Profitable Bank Stocks To Buy According to Analysts
8. East West Bancorp, Inc. (NASDAQ:EWBC)
Average Upside Potential: 15.57%
TTM Net Income: $1.166 Billion
East West Bancorp, Inc. (NASDAQ:EWBC) is the holding company for East West Bank. East West Bank started operating in 1973 as a federally chartered savings institution catering to the immigrant Chinese-American community and has evolved into a full-service commercial bank serving the US and China markets over time.
East West Bank is a leading regional bank and is among the few US banks with a full banking license in China. East West Bank holds the privilege of being the largest independent bank headquartered in Southern California. While it has 98 US branches in leading metropolitan markets, 4 branches in Asia support cross-border business. Other than having decades of cross-border expertise and serving an attractive market niche with high-growth demographics, a comparison with peers shows that East West has demonstrated strong profitability while outperforming peers on credit over the past decade.
Apart from boasting industry-leading profitability, East West Bancorp, Inc. (NASDAQ:EWBC) recently posted a record income of $1.2 billion for the full year 2024. Based on the strength of its customer relationships, the firm was successful in growing deposits by more than $7 billion over the year. Simultaneously, the strength in wealth management, lending, and deposit account fees led to fee income rise of 12% year-over-year.
7. HDFC Bank Limited (NYSE:HDB)
Average Upside Potential: 15.92%
TTM Net Income: $8.039 Billion
The Indian HDFC Bank provides banking and financial services to individuals and businesses. The Bank’s distribution network included 9,143 branches and 21,049 ATMs across 4,101 cities/towns as of December 31, 2024. The Bank’s international operations encompass four branches in Hong Kong, Bahrain, Dubai, and an IFSC Banking Unit (IBU) in Gujarat International Finance Tech City.
HDFC Bank serves as one of the largest private lenders in India which successfully entered the $100-billion market-cap club in 2023 and became the world’s 7th largest lender, following its reverse merger with its parent company, HDFC Ltd. Currently, the Bank is trying to normalize its credit deposit ratio with the deposit growth outpacing its loan growth. The deposit growth has been robust despite the challenging macro environment. At the same time, HDFC is achieving better distribution, with the addition of ‘about over 1,000-odd branches over a year-on-year period, on a 12-month period’, as reiterated by the CEO during the firm’s recent Q3 FY’25 earnings call.
For the quarter ended December 31, 2024, the Bank’s net revenue rose by 6.3% to ₹421.1 billion from ₹396.1 billion in the prior-year quarter. The Bank’s average deposits were reported to be ₹24,528 billion for the quarter, demonstrating a growth of 15.9% over the year. The Bank posted a standalone net profit of ₹16,736 crore for the quarter.
6. Credicorp Ltd. (NYSE:BAP)
Average Upside Potential: 18.31%
TTM Net Income: $1.387 Billion
Credicorp Ltd. (NYSE:BAP) is a leading financial services holding in Peru. The company is organized into four lines of business including Universal Banking, Insurance and Pensions, Microfinance, and Investment Banking and Wealth Management.
Credicorp Ltd. (NYSE:BAP) is a solid and sustainable financial services group that has over 135 years of experience in the Peruvian market. The company has a solid universal banking, insurance, and pension platform serving all segments of the Peruvian population as well as a growing presence in microfinance, investment management, and advisory in Latin America.
The growth potential of Credicorp Ltd. (NYSE:BAP) across the Andean Region remains extensive as the firm prioritizes leading market positions in an underpenetrated region. The diversified portfolio of the group is due to focusing on customer needs, which eventually drives its market leadership and offers cross-selling opportunities. It is worth mentioning that the firm has shown its capability to be resilient through economic cycles and improve its leadership position in hard times.
5. Banco Santander, S.A. (NYSE:SAN)
Average Upside Potential: 19.33%
TTM Net Income: $9.121 Billion
Banco Santander, S.A. (NYSE:SAN) is a Spanish multinational financial services company. Santander was founded in 1857 and it became Spain’s seventh-largest financial institution by its 100th anniversary in 1957. The company is structured under five global businesses including Retail & Commercial Banking, Digital Consumer Bank, Corporate & Investment Banking, Wealth Management & Insurance, and Payments.
SAN’s business model is based upon unique competitive advantages including diversification, a global scale, and customer focus. While Banco Santander, S.A. (NYSE:SAN) focuses on achieving well-balanced diversification between businesses and markets, its in-market and global scale helps enhance local banks’ profitability. As of September 2024, SAN boasts 171 million customers and €1,802 total assets. In recent years, the company has expanded its customer base with balanced growth by business and regions.
Recent news circulating regarding the company is that it is reviewing its presence in Britain according to a person familiar with the matter. While Santander left a statement referring to the UK as a core market, the bank is looking into strategic options, including leaving Britain to focus on larger growth regions such as the United States, as reported by the Financial Times. The higher costs of business for banks in Britain have been mentioned as a concern by several financial trade bodies, relative to international competitors.
4. ICICI Bank Limited (NYSE:IBN)
Average Upside Potential: 23.04%
TTM Net Income: $5.877 Billion
ICICI Bank Limited (NYSE:IBN) is an Indian multinational banking and financial services company. ICICI Bank provides different banking products and financial services to corporate and retail customers via various delivery channels and through its group companies.
Through a 360-degree customer-centric approach and by catering to opportunities across ecosystems and micromarkets, ICICI Bank continues to strengthen its position to drive profitable growth. The bank focuses on offering holistic solutions by integrating various financial services and leveraging its extensive franchise while enhancing delivery capabilities, striving to expand its market share across key segments.
For the quarter ended December 31 (Q3 of FY2025), the firm’s core operating profit rose by 13.1% year-on-year to ₹16,516 crore. In terms of deposit growth, total period-end deposits grew by 14.1% year-on-year. ICICI is also growing its branch network and had a network of 6,742 branches and 16,277 ATMs and cash recycling machines, as of December 31, 2024, with the addition of 129 branches during Q3-2025.
3. Itaú Unibanco Holding S.A. (NYSE:ITUB)
Average Upside Potential: 29.31%
TTM Net Income: $7.542 Billion
Itaú Unibanco Holding S.A. (NYSE:ITUB) is a full-service, universal bank. It is present in 18 countries with its main businesses including Corporate & Investment Banking, Asset Management, Private Banking, and Retail Business. The firm adopts the “Phygital” model (a combination of physical and digital) to provide its clients with the freedom to choose how they want to relate to the bank.
The firm is one of the largest Brazilian private banks in market value as well as one of the most valuable brands in South America. ITUB’s ability to adapt, innovate, and change has enabled it to achieve the status of a universal bank. Apart from offering the most complete portfolio of financial products and services, the firm serves clients how, when, and where they want to be served being a digital bank with the advantage of in-person service.
While Citi has reiterated a Buy rating on the bank’s stock while setting a price target of R$40.00, UBS analyst Thiago Batista upgraded the stock from Neutral to Buy. Batista pointed to the robust dividend prospects as well as the appealing valuation metrics of Itaú Unibanco Holding S.A. (NYSE:ITUB).
2. KB Financial Group Inc. (NYSE:KB)
Average Upside Potential: 33.37%
TTM Net Income: $3.309 Billion
KB Financial Group Inc. (NYSE:KB) is a leading Korean financial services provider and has 11 subsidiaries including KB Kookmin Bank, KB Securities, KB Insurance, KB Kookmin Card, KB Life Insurance, KB Asset Management, KB Capital, KB Real Estate Trust, KB Savings Bank, KB Investment, KB Data Systems. KB Kookmin Bank strives to be a reliable bank, offering the best financial services and being customer-centric. The Group offers integrated financial solutions and services to its clients through its businesses.
The company’s core strengths stem from its expertise, extensive customer base, wide distribution network, and strong brand. Being among South Korea’s largest banks, KB Financial Group Inc. (NYSE:KB) boasts the industry’s strongest capital position, a renowned low-cost deposit franchise, and leading fee income, as stated by Oakmark International Fund, which was excited to buy the shares at an attractive valuation for a bank ‘commonly acknowledged as the best bank in South Korea’.
KB Financial Group Inc. (NYSE:KB) recorded a cumulative net profit of KRW4,395.3 billion for Q3 2024. The group continues to generate stable profits based on balanced growth in key non-banking subsidiaries such as securities, insurance, and card. Although KB was exposed to challenges from rate cuts and an economic downturn, the aforementioned sectors played a positive role in the overall financial performance.
1. Shinhan Financial Group Co., Ltd. (NYSE:SHG)
Average Upside Potential: 48.04%
TTM Net Income: $3.337 Billion
Shinhan Financial Group Co., Ltd. (NYSE:SHG) is a financial holding company that originated from Shinhan Bank, which came into being in 1982 and was the first private bank in Korea. SHG serves as a Korean finance pioneer.
Shinhan Bank positioned itself as a blue-chip bank by developing a nationwide network and going public with an IPO. It took the initiative to set up a financial holding company that would enable it to grow its scale across multiple sectors as a comprehensive financial group. Shinhan Financial Group is currently one of the leading Korean financial leaders, leading the way in innovation. A customer-centered business has made the company what it is today, driving its sustainable growth.
Regarding Shinhan Financial Group Co., Ltd. (NYSE:SHG), Polaris Global Equity Strategy stated the following in its Q3 2024 investor letter:
“On the backdrop of interest rate cuts, financials shined on expectations for loan demand and cheaper cost of capital; in fact, all sector holdings were in absolute positive territory. Shinhan Financial Group Co., Ltd. (NYSE:SHG) was the top contributor, with a second quarter earnings beat on better non-interest income with credit costs under control. An enhanced shareholder return policy was a pleasant upside surprise, as Shinhan committed to returning 50% of earnings to investors through dividends and share buybacks by 2027.”
While we acknowledge the potential of SHG as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued AI stock that is more promising than SHG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.
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