Top ASX bank shares to watch in 2025

What are bank shares?

Bank shares are stocks of publicly listed companies that operate in the banking and financial services sector. When you buy a bank share, you’re essentially buying a small piece of the bank and gaining exposure to its profits, growth and overall performance.

Banks make money primarily through lending (like home loans, business loans and personal loans) and investing customer deposits. Owning shares enables share traders to benefit from the bank’s earnings, often in the form of dividends, and from any increase in the share price over time.

Bank shares can range from large, well-established institutions – often called blue-chip shares – to smaller regional or challenger banks. The larger banks tend to offer stability and regular dividends, while smaller banks or new entrants may provide higher growth potential but with more risk.

Why bank shares are important to Australia’s economy

Banks play a central role in Australia’s financial system. They help fund home ownership, business growth and government projects, making them essential to almost every corner of the economy. Because of this, the performance of Australia’s major banks often reflects the health of the country itself; when people borrow and spend more, banks usually do well; when the economy slows, their profits can be squeezed.

The largest banks, often referred to as the ‘Big Four’ – Commonwealth Bank, Westpac, NAB and ANZ – hold a dominant share of the lending and deposits market. Their lending activity supports everything from mortgages and construction to small business expansion, which, in turn, drives employment and consumer confidence.

Their large market capitalisations also mean they heavily influence the broader ASX indices, so movements in bank shares can affect the overall stock market.

Advantages of bank shares

• Reliable dividends: Major banks have a long history of paying consistent dividends, making them appealing for income-focused share traders
• Stability and scale: The big banks are well-established, heavily regulated and financially strong, offering a sense of security compared to smaller or newer companies
• Exposure to the Australian economy: Bank profits generally rise with economic growth, so they provide a way to gain exposure to national economic trends
• Portfolio diversification: They can add balance to a share portfolio, often performing differently from high-growth tech or resource stocks
• Market influence: Because bank shares are so prominent in the ASX, their movements often set the tone for the broader market, giving CFD traders clearer signals

Risks of bank shares

• Interest rate changes: Shifts in the RBA’s cash rate can directly affect bank margins, influencing profitability and share prices
• Housing market exposure: Most Australian banks are heavily tied to mortgage lending, so property market downturns can impact earnings
• Economic slowdowns: Weaker consumer spending or rising unemployment can lead to more loan defaults and lower profits
• Regulatory pressure: New financial rules or capital requirements can restrict banks’ lending activity or increase their costs
• News sensitivity: Bank shares react strongly to headlines, meaning CFD traders need to monitor the market closely to manage their risk effectively

Top 5 ASX bank shares to watch in 2025

The five shares we’ve highlighted were selected to provide a balanced view of Australia’s banking sector. Together, they represent a mix of size, stability and growth potential.

They reflect the diversity of Australia’s financial landscape, from the scale and dependability of the established giants to the agility and growth focus of newer and smaller entrants.

All figures are accurate as of 30 October 2025.

Overview of the shares in this article

All of the shares in this article, except for Australia and New Zealand Banking Group, are available for share trading with us, and all of them can be CFD traded with us.

1. Commonwealth Bank of Australia (ASX: CBA)

Market cap: A$284.87 billion¹

The Commonwealth Bank of Australia is the country’s largest bank and a cornerstone of the Australian financial system. It provides everyday banking, home loans, business lending and investment services to millions of Australians.

CBA is known for its stability and strong reputation, often viewed as one of the most dependable dividend-paying shares on the ASX. Its size and solid track record make it a key holding for share traders who want exposure to the Australian economy through a blue-chip stock.

For share traders, CBA offers reliability and consistent long-term performance, particularly appealing for those seeking steady income through dividends.

For CFD traders, it’s one of the most liquid financial stocks on the market, frequently reacting to interest rate announcements and economic news, which can create short-term trading opportunities.

Highlights:

• In its 2025 annual report, the company indicates it made A$10.133 million in statutory profit after tax (NPAT) – up 7% on FY24²
• It paid a really solid dividend, fully franked, of A$4.85 per share in FY2025³
• Its share price has grown 11.28% YTD⁴

2. National Australia Bank (ASX: NAB)

Market cap: A$132.68 billion⁵

National Australia Bank is one of Australia’s ‘Big Four’ banks. It serves a wide mix of customers, from individuals to large corporations, and has a particularly strong presence in business banking.

NAB has been modernising its operations in recent years, focusing on improving customer experience and simplifying its services. It’s regarded as a reliable performer with a balance between income stability and moderate growth potential.

For share traders, NAB offers exposure to Australia’s banking sector with a long history of paying dividends and maintaining consistent profitability.

For CFD traders, its share price tends to move with the broader financial sector, offering good liquidity and clear trends that respond to interest rate changes or market sentiment.

Highlights:

• According to its FY25 Q3 update, it earned A$1.66 billion unaudited statutory net profit, while revenue grew 3% compared to the quarterly average of the March 2025 half-year results⁶
• There’s been decent share price growth YTD – 17.65%⁷

3. Australia and New Zealand Banking Group (ASX: ANZ)

Market cap: A$110.08 billion⁸

Australia and New Zealand Banking Group is another major name in local banking, with a strong footprint across both countries and parts of Asia. It offers retail and business banking, wealth management and institutional services.

ANZ has focused on streamlining its operations and investing in technology, helping it stay competitive in a changing financial landscape. Its strong presence in two economies – Australia and New Zealand – gives it a slightly more diversified outlook than some of its peers.

For share traders, it’s a traditional choice for those seeking stable dividends and exposure to two closely linked but distinct markets.

For CFD traders, its price often tracks broader economic trends and responds sharply to financial data from both Australia and New Zealand, creating active trading conditions.

Highlights:

• Its latest earnings report – half-year results from May 2025 – indicate a cash profit of A$3.568 million, a 12% profit on the half-year results from FY24⁹
• The company’s share price has soared by 29.65% YTD¹⁰

4. Judo Capital Holdings (ASX: JDO)

Market cap: A$1.94 billion¹¹

Judo Bank is one of our country’s newer entrants to the banking sector and focuses mainly on small- and medium-sized businesses. It was founded to provide a more personal, relationship-driven approach to banking – something many business owners felt was lacking at larger institutions.

Its modern, technology-based model and focus on the SME sector give it a fresh approach and strong growth potential, though it also comes with higher risk compared to established banks. Judo has built a reputation for agility and customer service, appealing to those who value speed and flexibility.

For share traders, Judo offers a more growth-oriented exposure within the financial sector.

For CFD traders, it can be more volatile than the big banks, offering opportunities for those who like to trade momentum and respond quickly to changing sentiment.

Highlights:

• The company recently underwent a major IT platform revision, indicating its willingness to stay up to date with digital trends in the banking sector¹²
• Its latest earnings results show a 16% lending book growth, equal to A$12.5 billion¹³
• YTD, the share price has declined by 6.85%; however, over the past six months, it’s increased by 18.47%, showing that there’s substantial volatility for CFD traders to take advantage of¹⁴

5. MyState Limited (ASX: MYS)

Market cap: A$758.50 million¹⁵

MyState is a smaller, regionally based bank headquartered in Tasmania. It provides retail banking, wealth management and trustee services, and is known for its friendly, community-focused approach.

While it doesn’t have the scale of the major banks, MyState has carved out a niche by focusing on customer experience and competitive home loan products. Its gradual growth and focus on digital banking have helped it stay relevant in an increasingly competitive market.

For share traders, MyState can appeal as a smaller, income-producing stock with room to expand over time.

For CFD traders, it’s less actively traded than the big banks but can experience sharp movements after earnings announcements or economic updates, offering occasional short-term opportunities.

Highlights:

• MyState shows a healthy underlying NPAT of A$41.3 million in its FY25 annual report¹⁶
• Its total group customers amount to around 275,000¹⁷
• Its share price has seen a slight decline YTD – 0.67%, but it has gained 11.03% in the past six months¹⁸

How to trade ASX bank shares with IG AU

CFDs

1. Open a CFD trading account with IG AU
2. Search for ASX bank shares on the IG platform
3. Decide whether to go long (buy) or short (sell)
4. Choose your position size
5. Set stop-loss and limit orders
6. Place your trade and monitor it

Share trading

1. Open a share trading account with IG AU
2. Search for ASX bank shares
3. Choose the shares you want to buy
4. Determine how many shares you want to purchase
5. Place your order
6. Monitor your investment and collect any dividends

FAQs about bank shares

Footnotes
 

1. TradingView, October 2025
2. Commonwealth Bank of Australia, 2025
3. Commonwealth Bank of Australia, 2025
4. TradingView, October 2025
5. TradingView, October 2025
6. National Australia Bank, August 2025
7. TradingView, October 2025
8. TradingView, October 2025
9. Australia and New Zealand Banking Group, May 2025
10. TradingView, October 2025
11. TradingView, October 2025
12. The Motley Fool, October 2025
13. The Motley Fool, October 2025
14. TradingView, October 2025
15. TradingView, October 2025
16. MyState, 2025
17. MyState, 2025
18. TradingView, October 2025