NEW YORK ( TheStreet) -- Friday was a great day for bank stocks as investors grew more comfortable that the sector would sustain its earnings momentum.

Sector winners on Friday included PNC Financial ( PNC), which was up 5% to close at $64.22 and Capital One ( COF), which was up 4% to close at $48.38.

PNC is set to report its fourth-quarter earnings next Thursday before the market open. On January 7, Howe Barnes Hoefer & Arnett analyst William Wallace initiated his firm's coverage of the company with a buy rating and $75 price target, saying "PNC is one of the strongest banks in the country, which should help drive out-performance in shares for the next couple of years at least and should make it a core holding in investor portfolios."

Capital One Canada on Tuesday completed its acquisition of Hudson Bay Co.'s $1.3 billion credit card portfolio from GE Capital -- a subsidiary of General Electric ( GE) -- in a deal that will include the transfer of about 400 employees.

Capital One is scheduled to report its fourth-quarter results next Thursday, right after the market close.

The big banking story on Friday was JPMorgan Chase's ( JPM) announcement of $4.8 billion in fourth-quarter earnings, or $1.12 a share, far exceeding the consensus estimate of 99 cents a share among analysts polled by Thomson Reuters.

JPMorgan's release of $1.9 billion in loan loss reserves was partially offset by adding $1.5 billion to litigation reserves for mortgage-related legal expenses. The company also reported a large increase in bonus payouts in its investment banking division.

The company's shares rose 1% Friday, closing at $44.91.

The KBW Bank Index was up 2% to 54.70, with all component stocks up on the day. The worst-performing component of the index on Friday was M&T Bank Corp. ( MTB), increased slightly to $84.38, following the company's announcement of improved fourth-quarter earnings, which came in ahead of analysts' expectations.

In other industry news, the U.S. Treasury Department said on Friday that through Deutsche Bank ( DB) it would soon auction warrants to buy common stock in Citigroup ( C), Boston Private ( BPFH) and Wintrust Financial ( WTFC).


-- Written by Philip van Doorn in Jupiter, Fla.

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Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.