Editor’s Note: Today’s article spotlights five of Wall Street’s biggest institutions — including Wells Fargo and Goldman Sachs — simultaneously raising their dividends by 11-12%. For a look at where that kind of consistent dividend growth leads over decades, our colleague Robert Rapier has mapped 41 essential-service stocks now averaging 33% in annual yield on his original investment — with a 923% average total return. See how the math compounds →

The 96th rendition of Major League Baseball’s All-Star Game took place in Philadelphia this week. One of the highlights of the “Mid-Summer Classic” is the annual Homerun Derby, where the game’s elite sluggers put on a display of raw power. As a group, they launched a total of 131 bombs – some of which traveled nearly 500 feet.

The very next morning, five of Wall Street’s most venerated institutions hit their own kind of financial homeruns. Each handily smashed second quarter earnings estimates, delivering growth rates ranging from 17% to 78%. Combined, the influential group posted $49 billion in quarterly profits – about $765 million per business day — drawing “oohs” and “aahs” from spectators.

I’m talking about the “bulge bracket” money centers.

Citigroup (NYSE: C) raked in $5.8 billion in profits for the quarter. Believe it or not, that was the smallest take. Wells Fargo (NYSE: WFC) and Goldman Sachs (NYSE: GS) chipped in $6.4 billion and $6.6 billion, respectively. Bank of America (NYSE: BAC) hauled in $9.1 billion.

The big winner was JP Morgan Chase (NYSE: JPM), whose bottom line swelled by 41% to $21.2 billion. Some of that colossal figure came from one-time gains on the sale of Visa shares. About $4.6 billion, to be precise. But even without that, net income still approached $17 billion – the richest quarter in U.S. banking history.

Beneath the headline, JP Morgan Chase posted record revenues across every business line, most notably in the commercial segment – where the firm’s trading desks and investment bankers are swimming in cash. It pocketed $3.3 billion in equity and fixed income underwriting fees for the quarter, thanks in large part to its role in bringing SpaceX (NSDQ: SPCX) public.

Retail spending volume on JP Morgan branded debit and credit cards has risen by double digits. At the other end of the spectrum, the wealth management unit (which caters to large institutional customers) opened 44,000 new accounts. Net inflows reached $50 billion for the quarter, driving assets under management (AUM) beyond the $5 trillion level.

While lending spreads could be higher, new loan issuance pushed net interest income up 10% to $25.6 billion. Management sees the full-year total cresting at $100 billion. And non-interest revenues are growing twice as fast, increasing 20% from a year ago.

Between home buyers, small businesses, non-profit groups, multinational corporations, municipal agencies and foreign governments, JP Morgan Chase has raised $1.9 trillion in credit and capital for its customers so far this year. CEO Jamie Dimon attributes “AI-driven capital investment, fiscal stimulus and more efficient regulation.”

He goes on to summarize the current environment as “about as good as it gets.” The Wall Street Journal agrees, suggesting the banking sector is “on a Goldilocks run.”

It’s not just JP Morgan.

Bank of America, an engine for small business creation and expansion, retained its No. 1 small business lender status for the 20th straight quarter. The bank opened 160,000 new checking accounts from April through June and attracted $40+ billion in deposits, pushing the total past the $2 trillion mark.

Every segment reported healthy double-digit profit growth, leading to one of the bank’s strongest quarters on record. The Merrill Wealth Management team helped push asset management fees up 19%. Investment banking fees shot up 50%. Global equities trading revenues surged 70%.

And let’s not forget about the simple core practice of borrowing money at low rates and then loaning it at higher rates. Net interest income ballooned to $16 billion for the quarter, up from $14.7 billion a year ago.

Citing a strong commercial borrowing pipeline, BAC rewarded its shareholders with $8 billion in capital returns during the quarter ($2 billion in dividend distributions and $6 billion via stock buybacks).

Over in San Francisco, Wells Fargo is seeing the same gusty macro tailwinds. Management notes accelerating growth in new credit card accounts and auto loan originations. Assets under management (AUM) in the Wealth Management operation have climbed 15% to $2.4 trillion. Investment banking is even stronger.

Liking what it sees on the horizon, the board plans to hike dividends by 11% to $0.50 per share starting next quarter.

Goldman Sachs is also lifting its payout by 11% (25% year-over-year) to $5.00 per share. Goldman’s elite Global Banking & Markets division produced healthy 50% revenue growth for the quarter, propelled by heavy bookrunning fees and busy trading in the Fixed Income, Currency and Commodities (FICC) group.

Not to be outdone, Citi is upping its distributions by 12%… on top of an aggressive $30 billion stock buyback authorization. This coincides with the strongest revenue growth the company has seen in over a decade.

These idyllic conditions won’t last forever. Dimon prudently calls attention to stubborn inflation, global fiscal deficits and other threats, warning they could “cause meaningful disruptions when they shift or collide.” But all 32 major U.S. banks passed last month’s mandated liquidity and stress tests with flying colors. This group is well capitalized, buffered and ready to withstand the next economic shock.

For now, borrower credit quality is strengthening, overhead expenses (as measured by efficiency ratios) are falling, and bountiful Wall Street dealmaking has translated into lofty returns on equity of 18% at Wells Fargo, 23% at JP Morgan and 24% at Goldman Sachs.

That’s a big reason why most of these stocks are near (or at) 52-week highs. Yet, valuations remain generally compelling. For targeted exposure to this clan, consider the low-cost Invesco KBW Bank ETF (NSDQ: KBWB). These stocks occupy five of the portfolio’s top-six positions, with smaller weightings sprinkled among a couple dozen regional banks.

The dividend raises Nathan highlights today — 11% at Wells Fargo, 11% at Goldman Sachs, 12% at Citigroup — are a reminder of what consistent payout growth can become over time. Our colleague Robert Rapier has spent 36 years applying that same discipline in a narrower corner of the market: essential-service stocks with regulated profit margins and mandated customer demand. His Utility Forecaster portfolio of 41 holdings now averages 33% in annual yield on his original investment — five positions paying over 100% annually on cost. See which 41 stocks are on the Dividend Map →