Outlook is very positive for the big banks, says CFRA's Ken Leon

Summary

Ken Leon of CFRA discusses a positive 2026 outlook for financials and big banks. He argues financials are critical for U.S. equity market breadth, expects upward earnings revisions, and sees capital markets as the key earnings delta. He also highlights potential regulatory easing that could support buybacks and dividends. The conversation touches on bank valuation and Goldman Sachs' premium to book value.

• Ken Leon, CFRA director of equity research, joins Squawk Box to discuss 2026 bank earnings.
• He says financials are critical for broad U.S. equity market participation.
• He expects a very positive outlook for big banks, with upward earnings revisions.
• He cites a steepening yield curve, loan demand, and 2-3% U.S. growth as support.
• He identifies capital markets, M&A, equity underwriting, and IPOs as key 2026 earnings drivers.
• He sees potential Fed regulatory easing enabling bank capital release, buybacks, and higher dividends.
• The hosts raise whether bank stocks, including Goldman Sachs, are expensive on book value.
• The transcript ends as Ken discusses the Trump administration's favorable stance on bank regulatory easing.