Top 25 global banks add 5.4% market value in Q2 2024, says GlobalData. HDFC, China Construction Bank lead charge

The top 25 global banks saw a collective market capitalization increase of 5.4%, reaching $4.11 trillion by the end of Q2 2024, according to GlobalData. The growth was driven by positive global economic trends. China Construction Bank and HDFC Bank led the charge with stock growth exceeding 15%, while TD Bank experienced a nearly 10% decline.

In Q2 2024, HDFC Bank's market capitalization rose by 17%, reaching $154.4 billion, placing it 10th among the top 25 global banks. ICICI Bank experienced an 11.5% increase in market cap, reaching $102.7 billion, moving it up to the 18th position. Meanwhile, the State Bank of India saw an 11.9% rise in market cap, reaching $90.1 billion, positioning it at 21st on the list.

JPMorgan Chase maintained its position as the most valuable bank for the ninth consecutive quarter, showcasing strong performance amid changing economic conditions.

“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.”

Here's how it stacks up

China Construction Bank (CCB)

CCB's stock surged by 21.8% in Q2 2024, fueled by a strong capital position and attractive valuations. This rise followed a solid Q1 2024, where the bank reported a CNY1.17 trillion increase in gross loans and advances, and a CNY1.71 trillion rise in customer deposits.

HDFC Bank

HDFC Bank’s market value grew by 17% in Q2 2024, reaching $154.4 billion. Strong quarterly results and rising investor optimism about future performance drove this growth. HDFC Bank is expected to reclaim industry-leading profitability, thanks to an improved loan mix and normalized funding costs.

JPMorgan Chase

JPMorgan Chase consolidated its status as the world’s leading bank, reporting a 9% increase in net revenue to $41.9 billion compared to Q1 2023. This growth was driven by an 11% rise in net interest income, attributed to the acquisition of First Republic, and a 7% increase in non-interest revenue, spurred by higher asset management fees and reduced net investment securities losses.

TD Bank

TD Bank's market capitalization fell by 9.6% to $96.7 billion, following a US-led probe into alleged money laundering through its branches. The bank is under pressure to outline its next growth phase after an ambitious US retail banking expansion and the termination of a $13.4 billion deal to acquire First Horizon Corp. due to regulatory delays.

Chinese Big Four Banks

The market value of China’s top four banks—ICBC, Bank of China, Agricultural Bank of China, and China Construction Bank—grew between 3% and 22%. Despite this growth, all four banks saw a decline in net interest margins in Q1 2024 due to lower loan prime rates and market interest rates.

“The performance of global banks in the second half of 2024 will depend on economic conditions, monetary policies, and inflation. Geopolitical factors, including trade tensions and conflicts, could impact international operations and market stability. Regulatory scrutiny, as seen with TD Bank, will also affect strategic initiatives and performance. Overall, despite challenges, potential rate cuts, economic resilience, and technological advancements may benefit global banks,” said Grandhi.