For the second quarter, the banking sector reported $40.24 billion in net income. That's the secondhighest it's been for any quarter in more than two decades.
Yet curiously, the KBW Bank Index is down 1.2 percent over the past 30 days while the S&P 500 index is green. What's more, the financial sector as a whole is trading at 14.3 times its earnings, making it the cheapest of all ten sectors in the S&P 500.
For Gina Sanchez, founder of Chantico Global, the answer to this riddle is simple: It comes down to government scrutiny.
"Going forward, we're looking at regulation that, while it's designed to de-risk banks, is also probably going to impair their profitability," said Sanchez, a CNBC contributor. "All of the banks are actually going to be suffering from that."
Ari Wald, head of technical analysis at Oppenheimer & Co., is no fan of the banks either.
(See: CNBC's Bank coverage)
"The banking industry is losing a little bit of steam after a very strong run," Wald said. "We're bullish on the market. We think stocks in general will do well. But as a hedge to this view, we're underweight the banks. We think this is the likely culprit to drag stocks lower if a deeper correction ultimately ensues."
Focusing on the KBW Bank Index, Wald points out that it has enjoyed a strong run since October 2012. The index has mostly stayed above its technically significant 200-day moving average.
"But we are seeing some signs of a possible top," he warned. "It couldn't make it to a new high in that June to July period when a lot of the market was able to do this."
Wald sees a scenario in which banks stocks trade sideways, underperforming a rising equity market.
"There is a risk that if these support levels do breach, then that top is broken," Wald said. "Then you'll have to start worrying about absolute losses as well."
To see the full discussion on the banking sector and the KBW Bank Index, with Sanchez on the fundamentals and Wald on the technicals, watch the above video.