America’s largest banks are entering 2026 with strong earnings momentum, buoyed by resilient consumers, healthy dealmaking activity, and steady credit conditions. Results released Wednesday by Bank of America, Citigroup, and Wells Fargo show that despite geopolitical uncertainty and market volatility, the core engines of U.S. banking remain firmly intact. Yet beneath the upbeat numbers, a new fault line is emerging between Wall Street and Washington over proposed limits on credit card interest rates and renewed pressure on the Federal Reserve.

Earnings Strength Signals Economic Resilience

Bank of America delivered a particularly robust performance, reporting quarterly profit of $7.6 billion, or $0.98 per share, up from $6.8 billion a year earlier. Revenue reached $28.4 billion, reflecting higher net interest income, solid fee generation, and continued consumer engagement. Chief Executive Brian Moynihan said businesses and households are “proving resilient,” adding that the bank remains bullish on the U.S. economy in 2026 despite lingering risks.

At Wells Fargo, profits rose to $5.36 billion, or $1.62 per share, compared with $5.08 billion a year earlier. Revenue totaled $21.3 billion as consumer activity and credit usage increased at a controlled pace. Management emphasized that loan growth and card usage remain healthy, while delinquencies and charge-offs have stayed relatively stable—an important signal for credit quality heading into the new year.

Citigroup posted solid operating performance as well, with executives pointing to strength in investment banking and steady consumer behavior. Chief Financial Officer Mark Mason described the economy as “resilient,” noting that while geopolitical risks persist, the broader system has absorbed uncertainty without meaningful deterioration in demand or credit.

Consumers Continue to Spend

Across the sector, executives pushed back against the notion of a sharply divided “K-shaped” economy. At Bank of America, credit and debit card spending rose 6% year over year, while credit card balances increased a manageable 3% to $103 billion. Retail deposits also climbed to $945.4 billion, underscoring consumer confidence and liquidity.

Wells Fargo reported a similar pattern, with rising card activity and consumer loan growth offset by stable credit metrics. Bank leaders emphasized that household balance sheets remain healthy, supported by employment strength and wage growth, even as inflation and interest rates remain elevated.

A Political Rift Begins to Open

Until recently, the banking sector had largely aligned with the White House. President Donald Trump signed a sweeping tax-cut package into law last summer and pursued a deregulatory agenda welcomed by banks and corporations alike. The environment encouraged a revival in dealmaking, supporting investment banking revenues across Wall Street.

That alignment is now being tested. Trump has floated a proposal to cap credit card interest rates at 10% and has voiced support for a Justice Department investigation into Federal Reserve Chair Jerome Powell—moves that bank executives see as destabilizing. Industry leaders argue that a hard cap on card rates would restrict access to credit, particularly for higher-risk consumers, and could ripple negatively through the broader economy.

Citigroup’s Mason warned that while affordability is a legitimate concern, interest rate caps could have unintended consequences by limiting credit availability to those who need it most.

Looking Ahead

For now, earnings power is giving big banks a strong buffer against political and macroeconomic uncertainty. Trading, lending, and consumer activity are all contributing to results that reflect an economy still expanding rather than contracting. The larger question for 2026 is whether policy friction—especially around credit markets and central bank independence—begins to weigh on sentiment and strategy.