This year’s stock sell-off hasn’t spared banks, with the KBW Bank index down more than 20%, largely in line with the broader S&P 500’s decline. Shares of large U.S. banks have declined despite rising interest rates, which should help boost the profitability of their core lending activities. That’s because investors are now concerned that a recession is on the horizon, which will lead to increased defaults as borrowers struggle to repay loans. Given that setting, Bank of America analysts led by Ibrahim Poonawalla reviewed the bull case as the top pick among many analysts coming into 2022 to see if it holds up mid-year. Four of the six factors tracked by the researchers were positive or stable at Wells Fargo, analysts said in a research note on Thursday. There were only two negatives: fee revenue from the bank’s mortgage division declined sharply, and share buybacks decreased as the firm conserves capital. According to analysts, Wells Fargo’s ability to take advantage of low expenses is perhaps the best among large US banks. This week, the bank’s CFO reiterated the previous $51.5 billion target on that front. According to Bank of America, Wells Fargo can afford to drag its feet on raising interest rates for depositors, and with the credit quality of its loan book stable, there’s no reason to add to reserves in the near-term. Most importantly, the company’s path to a 15% return on tangible common equity is “sustainable” and could be as late as 2022 due to the Federal Reserve’s aggressive rate hikes. Those factors, according to Poonawalla, help make Wells Fargo one of the “most compelling risk/reward” valuations, with the bank’s stock valuation declining 20% this year before Thursday. Broadly speaking, the banking sector as a whole should hold up better in a possible recession than in 2008, as regulators have forced companies to hold twice as much capital as before and endure annual stress tests. — CNBC’s Michael Bloom contributed to this story