Top Banking Stocks to invest in 2022 by The Uptrend Center Analyst


London, UK– Bank stocks refer to the shares representing banking institutions. The Bank is an economic institution whose main aim is to earn profit through exchanging money and credit instrument. Mostly the banks are profit-making private organizations; however, some banks are private, and some are government-owned. Here is an overview of different kinds of banks, some very important yardsticks for investors to know prior to investing in bank stocks, and three top banking stocks to consider for investment in 2022 for beginners.

The Categories of banks

There are many types of banks, such as commercial banks, private banks, investment banks, community banks, private banks, offshore banks, community development banks, online banks, land development banks, universal banks, etc. Banks accept deposits and lend money to individuals and businesses. Moreover, bank activities can be categorized as retail banking, business banking, corporate banking, private banking, and investment banking. These categories are further explained as follows;

  • Commercial Banks

Commercial banks are the type of financial institutions that accept money from the public, referred to as “deposits,” and lend money for the purpose of consumption and investments to make a profit which is referred to as “loans.” In general, commercial banks accept deposits, provide loans, safeguard assets, and work with different types of clients, including businesses and the general public. Commercial banks provide a number of services. These services include checking and saving accounts, auto loans, mortgages, leasing, treasury management, cash management, private equity finances, bank drafts, internet banking, etc. There are more than 25000 commercial bank branches over the globe, and a few names are Bank of America Corp., Atlantic Southern Bank, Bank of Union, Central Financial Holdings Inc., etc.

  • Investment Banks

Investment banks provide their services to high net worth individuals and individual clients regarding their investments. These banks do not accept deposits like commercial banks and retail banks. Investment banks provide different types of services, such as issuance of debt securities, and they advise on mergers and acquisitions; and for these services, they charge fees from the clients. Investment banks also make money in other ways, such as trading in equities, currencies, commodities, and fixed-income securities. Goldman Sachs, Morgan Stanley, JPMorgan, and Bank of America Merrill Lynch are some names from the top 10 investment banks. During the recession, investment banks tend to hold quite well rather than commercial banks.

  • Universal Banks

Universal banks provide their services as both commercial banks and investment banks at the same time. It is a system that offers asset management, deposits, payment processing, investment advisory, underwriting, securities transactions, financial analysis, insurance, and other financial and investment-related services. Some of the notable universal banks include Deutsche Bank, HSBC, and ING Ban world-widely, and Bank of America, JPMorgan Chase, and Wells Fargo are popular names of universal banks within the United States.

According to Joseph Goldstein, a stocks analyst from The Uptrend Center, bank stock is a tremendous long-term investment in 2022. They can provide excellent investment opportunities. But for beginners, it isn’t easy to decide where to invest in the financial sector. There are hundreds of banks listed on the U.S. stock exchange, and they are performing very well. Goldstein has provided an overview of the top 3 bank stocks of 2022, which can be very helpful for investors to access the potential growth of bank stock investment.

1- Bank of America Corp. (BAC)

The Bank of America, or the Bank of America Corporation, is the second-largest investment bank in the United States. Its headquarter is in Charlotte, North Carolina. San Fransisco is the founder of BofA. Currently, it is the eighth largest bank in the world. It has approximately 4,600 number of retail financial centres & 16,200 ATMs. The Bank operates in about four different segments, including Global Wealth & Investment Management, Global Markets, Consumer Banking, and Global Banking.

The stocks of Bank of America Corp. are listed on NYSE under the ticker symbol BAC. The total market capitalization of BAC is US$ 295.93 billion. The total shares outstanding are 8,056,881,363. BofA has total assets worth US$3.085 trillion, and it pays a dividend yield of 0.84 (2.29%).

According to experts, it is a great opportunity for the investors to invest in BAC because they think the quality of assets is super, with a relatively high concentration of deposits that do not pay interest to the depositors, and Bank is in a great position. There might be chances of high profitability in the near future.

2- JPMorgan Chase (JPM)

JPMorgan Chase is an American-based financial services holding company and investment bank. JPMorgan has headquarters in New York City and was founded in 1799. JP Morgan is a famous name in the world of financial markets, and it serves world-widely. The Bank provides various services, which include asset management, banking, commodities, credit cards, equities trading, insurance, investment management, mortgage loans, mutual funds, private equity, risk management, wealth management, etc. Approximately 273,948 employees are working with this Bank.

The shares of JPMorgan are listed on NYSE under the ticker symbol JPM. The Bank has a market capitalization of $381.55 Billion. Its earnings per share (EPS) is 13.48, and it pays a dividend yield of 4.00 (3.08%). Experts predict that JPM might be a good choice for beginners because it has great potential to boost in the long run.

3- U.S. Bancorp (USB)

U.S. Bancorp is one of the bank holding companies in America, and it is based in Minneapolis, Minnesota. The company provides various services such as consumer banking, mortgage, private banking, wealth management, payment services, investment banking, treasury, and corporate banking, etc. the bank is also engaged in services like credit cards, ATM processing, insurance, brokerage, leasing, and merchants.

The shares of U.S. Bancorp are listed on NYSE under the ticker symbol USB. The total market capitalization of USB is US$ 77.07 billion. Total share outstanding are 1,485,740,142. Its recent earnings per share (EPS) is 4.64, and it pays a dividend of about 1.84 (3.56%). According to experts, it would be a good pick for value investors as it may outperform the sector.

Disclaimer: Our content is intended to be used for informational purposes only. It is very important to do your own research before making any investment based on your own personal circumstances. You should take independent financial advice from a professional in connection with, or independently research and verify, any information that you find on this article and wish to rely upon, whether for the purpose of making an investment decision or otherwise.

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