Big Bank ETFs Are Big Winners in 2025

Funds holding large financial institutions have significantly outperformed broad market indices this year.

September 15, 2025Updated 12 hours ago

The whole point of big banks is to hold clients’ money and watch it grow, so it kind of makes sense that funds tracking them are outperforming this year.

Exchange-traded funds holding large bank equities have beaten broad market indices by a significant margin year-to-date, with some up nearly 50%, according to CFRA Research data. And that momentum is expected to continue into next year, as well. “The optimism for both Europe and US banks is the view that non-fee income from capital markets activity and wealth management is going to grow,” said Aniket Ullal, head of ETF research and analytics at CFRA.

Bank Shot

Major banks and lenders around the world have been on a roll. Goldman Sachs posted its best stock-trading quarter in history in Q2 with revenue reaching $4.3 billion. Citigroup’s second-quarter net income increased 25% year-over-year. JPMorgan Chase beat its earnings on the back of increased IPO and M&A activity. All those banks’ share prices are up at least 25% year-to-date.

And it’s not just the US. European banks, in particular, have had a standout year, thanks to strong loan demand, according to Ullal. “Some key markets like Germany have been pursuing supportive policies like increasing spending on sectors like infrastructure and defense,” he told ETF Upside.

And what’s good for the goose (in this case, major banks) is good for the gander (the ETFs tracking them), per CFRA data:

iShares MSCI Europe Financials ETF (EUFN) is up more than 48% this year and has taken in nearly $1.6 billion as of the end of August. This is the first time in the past five years it has outperformed iShares Core S&P 500 ETF (IVV).
Themes Global Systemically Important Banks ETF (GSIB) is up roughly 45% with flows of almost $14 million. European banks account for all five of the largest YTD return contributors.
Invesco KBW Bank ETF (KBWB) has risen about 20% and taken in more than $1.5 billion.

Still Stressing. Regional banks, on the other hand, haven’t been as lucky, performing well in the recent stress tests, but lagging peers on YTD returns, according to Ullal. And that can be seen in a fund like the SPDR S&P Regional Banking ETF (KRE), which has trailed the S&P 500 and experienced nearly $1.2 billion in outflows this year.