NEW YORK ( TheStreet) -- Despite chronic concerns over the fiscal cliff and constant threats of European debt, financial stocks were one of the bright performers in 2012. One would think it would be the other way around.The fact that Bank of America's ( BAC) stock was able to double despite an unfavorable interest rate climate highlights how fortunate investors were in the banking sector. Will that continue for the banking sector? Here are two names to watch closely in 2013. JP Morgan Chase ( JPM) It makes sense to lead off with JP Morgan since the bank lead off 2012 with a bombshell -- announcing it had amassed a credit-derivative loss (initially reported) of $2 billion. Investors later learned the poor trade -- now known as "London Whale" -- had actually reached levels of close to $7.5 billion. On the news, the stock lost almost 30% of its value. But it didn't last. Wall Street has a very short memory. Nothing says I'm sorry better than beating earnings, which JP Morgan managed to do in both quarters that followed. In the most recent quarter JPM exceeded both top- and bottom-line estimates, beating EPS and revenue goals by 6% and 16%, respectively. The bank posted revenue of $25.9 billion, which was 13% better sequentially and improved 6% year over year. Net income also soared to $5.7 billion, a 15% sequential improvement. This was also enough to top rivals such as Citigroup ( C), which posted revenue of $19.4 billion, declining 7% year over year. There's plenty to like with JP Morgan at current levels, including 20% upside potential. The catalysts will include the possibility of share buybacks over the next couple of quarters and the bank's commitment towards deleveraging its balance sheet. Investors should expect shares to reach the $52 level by the second half of the year. Wells Fargo ( WFC) Next on the list is Wells Fargo. Although the bank's third quarter was not up to its usual standards, relative to expectations, it wasn't all that bad. Plus, it was enough to continue what is now 11 consecutive quarters of profit growth, posting $4.9 billion in the third quarter. Not only was this a company record, but it also represented year-over-year increase of 22%.