How to choose bank stocks in 2025? An in-depth investment guide to 12 global financial institutions

In diversified investment portfolios, bank stocks are often favored for their stable dividend yields and strong financial foundations. However, faced with a plethora of banking options, investors frequently find themselves in a dilemma: which bank stock is the best choice? This article will analyze 6 Thai banks and 6 international banks in detail to help you identify the most suitable investment targets for 2025.

The International Banking Landscape Is Set, Who Is Your First Choice?

JPMorgan Chase & Co. (JPM) - The Pillar of the U.S. Financial Empire

As the largest financial institution in the U.S. by market value, JPM leverages a diversified business model (retail banking, investment banking, wealth management, asset management) and a strong brand presence, making it a must-have asset for global institutional and individual investors. Its investments in cutting-edge technologies like AI lay a foundation for future growth.

Key Data: Market cap $185 billion, P/E ratio 11.5x, dividend yield 2.5%

Bank of America Corporation (BAC) - The Second-Tier Powerhouse in Retail Banking

As the second-largest bank in the U.S., BAC’s advantages lie in its extensive retail customer base and large demand deposit scale. During periods of high interest rates, the widening net interest margin (NIM) has brought substantial profits. However, economic downturn risks and non-performing loan pressures require close attention. Notably, Warren Buffett’s Berkshire Hathaway maintains a significant stake in this stock.

Key Data: Market cap $110 billion, P/E ratio 10x, dividend yield 2.8%

HSBC Holdings plc (HSBC) - The Financial Bridge Connecting East and West

HSBC’s unique position stems from its deep-rooted presence in Asia (especially Hong Kong and Mainland China), enabling it to benefit from the economic integration of East and West. Nonetheless, geopolitical risks and organizational restructuring uncertainties warrant caution.

Key Data: Market cap $50 billion, P/E ratio 6.5x, dividend yield 6%

DBS Group Holdings Ltd (DBS) - Southeast Asia’s Leading Financial Institution

As the largest bank group in Southeast Asia, DBS is recognized internationally for its digital banking leadership and steady profit growth. Its potential to benefit from ASEAN economic expansion makes it a regional investor’s top pick.

Key Data: Market cap $25 billion, P/E ratio 10.5x, dividend yield 4.5%

Industrial and Commercial Bank of China Limited (ICBC) - The Largest in Scale but Risks Emerge

ICBC, with the largest asset size globally, sees growth closely tied to China’s economy. However, its relatively opaque asset quality assessments, potential policy risks, and capital adequacy pressures mean this investment requires high caution. The low P/E ratio (4x) implies market risk premiums are embedded.

Key Data: Market cap $75 billion, P/E ratio 4x, dividend yield 6.5%

Mitsubishi UFJ Financial Group, Inc. (MUFG) - A Revival Opportunity for Japan’s Financial Giant

As Japan’s largest financial group, MUFG operates extensively worldwide. The Bank of Japan’s potential rate hikes could improve profitability, but sluggish domestic economic growth remains a long-term constraint. Notably, MUFG is the major shareholder of Thailand’s Krungsri (BAY).

Key Data: Market cap $40 billion, P/E ratio 9.5x, dividend yield 3%

The Top Six Thai Banks Revealed, Who Is Most Worth Betting On?

Comparative Table: Core Indicators of Thailand’s Six Major Banks

BBL (Bangkok Bank) - A Steady Representative of Traditional Blue Chips

Bangkok Bank boasts strong capital strength and an extensive international branch network, giving it an absolute advantage in large corporate financing. Its diversified regional risk and consistent dividend policy attract conservative investors. While its growth rate is not as rapid as retail- or tech-focused peers, this reflects its positioning as a “safe haven.”

Analysts’ forecasts show LH Securities sets a target price of 178 THB, expecting the bank to achieve the highest profit growth in 2025. Conversely, TISCO Securities has lowered its forecast to 161 THB, warning of asset quality risks.

KBANK (Kasikornbank) - Pioneer in Digital Innovation

Kasikornbank has established a solid foundation in retail and SME lending, with its K PLUS app becoming one of Thailand’s most popular digital banking platforms. Its proactive investments in fintech and startup ventures open new avenues for profit growth.

However, high concentration in SME loans poses non-performing loan risks. KGI Securities and Asia Plus Securities remain optimistic about the stock, expecting further gains in 2025, with dividend yields of 4-5%.

SCB (Siam Commercial Bank) - Transformation Journey

SCB is undergoing a major organizational restructuring, transforming into SCBX Group, aiming to lead in fintech and digital assets. This change offers opportunities but also uncertainties. During this transition, dividends may not be as high as historical levels.

Asia Plus Securities favors its 6-8% high dividend yield potential, while Bangkok Bank recommends the stock based on its high dividend policy.

KTB (Krungthai Bank) - State-Owned Bank’s Policy Dividend

As a state-owned commercial bank, KTB has built a large user base through its “Pao Tang” app, becoming a key channel for government project financing. Turning these users and data resources into sustainable business value is its core challenge.

The lower risk profile of loans to state enterprises is an advantage over private banks. Kasikornbank Securities recommends the stock for its growth potential in government loans and low NPL ratio. Asia Plus Securities classifies it in the 4-5% dividend yield tier.

TTB (TMB Bank) - M&A and Integration Opportunities

TMB’s merger with Thai Financial Bank is still in the integration phase; realizing synergies will be key to future growth. Reducing the cost-to-income ratio and advancing digital transformation are priorities for management.

Although Kasikornbank Securities has lowered its 2025 profit forecast, its active capital management (stock buybacks and dividend increases) makes it a key recommendation. DAO Securities lists it among five top picks, optimistic about its 6-8% dividend yield and limited downside risk.

BAY (Bank of Ayudhya) - Local Operations Backed by International Capital

Bank of Ayudhya’s biggest advantage is its holding by Japanese financial giant MUFG, providing ample capital support, advanced technology, and a global business network. Its expertise in retail loans (especially auto and personal loans) is well recognized. Expansion into other Southeast Asian countries is ongoing.

Investech Securities maintains a target price of 25 THB, while TISCO Securities slightly raises it to 25.5 THB.

Why Do Bank Stocks Remain Attractive in 2025?

Long-Term Support from Interest Rate Environment

Although a global rate-cut cycle may have begun, interest rates remain well above the extremely low levels during the pandemic. This “new normal” environment is expected to persist in the medium term, providing sustained support for banks’ net interest margins (NIM).

Long-Term Appeal of Dividends

The cyclical nature of banking makes it a preferred choice for investors seeking stable cash flows. Global banks are expected to further increase dividend payouts by 2025, including higher ordinary dividends and share buyback programs.

Economic Recovery Certainty

According to Goldman Sachs, global GDP is projected to grow 3.1% in 2025; Innovex forecasts Thailand’s GDP to grow 2.7%. In this recovery context, credit demand from businesses and households is expected to rise modestly.

Relatively Low Valuations

Some bank stocks, especially international banks, still trade at P/E ratios below their historical averages, offering value investment opportunities.

The Wave of Digital Ecosystem Innovation

Modern banks are evolving into open financial ecosystems. By integrating e-commerce, logistics, insurance, and investment services, banks are transforming mobile apps into “one-stop” lifestyle platforms. This strategic shift underpins business growth and alters revenue structures.

How Can Thai Investors Participate in Bank Stock Investments?

Local Bank Stocks — A Simple and Convenient Path

For Thai investors, buying bank stocks listed on the SET is straightforward:

Step 1: Open a trading account with a licensed securities firm (broker) Step 2: Deposit funds into the account to obtain trading capacity Step 3: Place orders via trading platforms (such as Settrade Streaming or broker apps)

International Bank Stocks — Start Global Allocation

For Thai investors wanting to diversify into international banks, there are multiple options:

Via local brokers’ international trading services: Many Thai brokers offer direct access to international securities, allowing account management and support within the same platform.

CFD channels: CFDs provide opportunities to trade global financial products with smaller initial capital. Advantages include high leverage (amplify gains/losses), two-way trading (long/short), high flexibility, and usually no commission. Platforms like Mitrade offer such services.

Special Offers: New clients can receive a $100 deposit bonus, zero commissions, low spreads, and a $50,000 demo account for risk-free practice.

Investing involves risks and may not be suitable for all investors.

Conclusion: Rational Choices for Bank Stocks in 2025

When faced with the question “Which bank stock to choose,” there is no absolute right answer. Investment decisions should be based on individual risk tolerance, investment horizon, and return expectations.

Whether conservative investors seeking stable dividends or aggressive investors aiming for capital appreciation, bank stocks offer options. Thai bank stocks provide familiarity and easy trading channels; international bank stocks offer diversification and broader opportunities.

With thorough research and risk assessment, appropriate allocation and regular monitoring can make bank stock investments an effective tool for building long-term wealth in 2025 and beyond.