Wall Street’s own Telis Demos with the Wall Street Journal is making a sensible point: megabanks deserve a spot in patient portfolios as 2026 shapes up to be another active year for big-bank deal-making. He argues that the same forces that brought banks back to life in 2025—rising fees, renewed capital-markets activity, and strategic consolidation—could keep the momentum going into the new year.
Last year proved the skeptics wrong as bulge-bracket banks delivered outsized profits and their stocks rallied, driven in part by a parade of massive transactions that restored confidence in the sector. Wall Street saw an incredible surge in announced megadeals and large banks benefited from both deal fees and higher net-interest income, which translated into real earnings for shareholders.
The practical reason to hang on is straightforward: when M&A and capital markets reopen, the biggest banks collect the spoils. Industry insiders and leading boutiques have been cataloging a rebound in advisory activity and underwriting that could turn 2026 into another banner year for fees and strategic transactions. That kind of business can drive returns even if broader markets wobble.
Tech and AI investments, corporate divestitures, and the inevitable wave of strategic repositioning after a choppy two years are additional tailwinds for deal flow. Advisors and firms are pointing to these structural drivers — not to vague optimism — as concrete reasons why big banks are likely to be busy executing large transactions in the months ahead.
Let’s be blunt: Americans who buy into hysterical calls to ditch big-bank stocks are letting politics get in the way of profits. These institutions are deep-pocketed, well-regulated by capital standards that conservatives supported after past crises, and they serve as the plumbing of our economy. When they thrive, Main Street benefits through credit, jobs, and investment; punishing them because of partisan narratives is bad policy and worse investing.
That does not mean risk is zero. Corporate-credit stress, geopolitical noise, and any sudden regulatory overreach can dent deal appetite and compress valuations, so prudence matters. Keep a close eye on interest-rate signals and credit spreads, because if corporate finance cools, the M&A engine that fuels big-bank earnings could slow quickly.
For patriotic, hard-working investors the sensible middle path is clear: hold core positions in financially strong megabanks and watch for catalyst-driven buying opportunities while holding management accountable for capital discipline. Reward managers who return capital, push for sensible deregulation that fosters growth, and remember that free markets—not Washington’s fearmongering—built the financial system that fuels American prosperity.
