The European Union’s largest banks achieved another year of record profits in 2024, capitalising on elevated interest rates and expansion into fee-based businesses. Total net income for the 20 largest publicly traded banks in the region rose by 7.1% to €110 billion (US$115 billion), according to data compiled by Bloomberg News. This follows a remarkable 36% increase in 2023.
Despite signs that profit growth may be slowing, many banks have effectively managed the impact of declining interest rates. By investing in wealth management, asset management, and advisory services, lenders have diversified their revenue streams beyond traditional lending income.
“Earnings resilience continues despite lower rates,” analysts at Barclays Plc, including Flora Bocahut, said in a note published Monday. They project that the sector’s return on tangible equity, a key measure of profitability, will decline slightly from 14% in 2024 to 13% in the current year.
Increased returns to investors
With strong earnings, banks have ramped up shareholder returns. The 20 banks analysed announced €18.4 billion in share buybacks in the first two months of 2025—a 29% rise from the same period last year. Bloomberg Intelligence analyst Ilia Shchupko highlighted the trend, noting that several banks surpassed expectations with their dividend and buyback announcements.
Barclays analysts estimate that the 40 European banks they track will distribute around €264 billion to investors over the next two years, reflecting continued confidence in their financial health.
Leading performers and notable shifts
Spain’s Banco Santander SA led in absolute profit terms, reporting €12.6 billion in net income for 2024. French rival BNP Paribas SA followed closely with €11.7 billion.
Meanwhile, Société Générale SA posted the highest year-over-year growth, with net income surging by 69% after a weaker performance in the prior year. In contrast, Deutsche Bank AG recorded the steepest decline in earnings due to legal settlement costs.
