Goldman Sachs’ Profits Up 44 Percent; CEO Blankfein to Retire
The New York-based bank's second-quarter profits are up nearly $1 billion over the same period last year.
Lloyd Blankfein, chief executive officer at Goldman Sachs since 2006, will retire Sept. 30. (Mark Lennihan / AP)
NEW YORK—Goldman Sachs’ profits jumped 44 percent in the second quarter compared with a year ago, driven by the investment bank’s core franchises: advising companies on mergers, acquisitions and other deals, and its trading business.
Goldman also said Tuesday that Chief Executive Officer Lloyd Blankfein will retire on Sept. 30 and be replaced by David Solomon, the president and chief operating officer. Blankfein has been CEO since 2006.
The New York-based bank said earnings reached $2.35 billion in the second quarter, compared with $1.63 billion a year earlier. On a per-share basis, Goldman earned $5.98 a share, compared with $3.95 a share a year earlier, beating analysts’ forecasts of $4.65 a share.
Nearly all of Goldman’s businesses saw double-digit growth in the second quarter. Trading was particularly strong. Goldman’s institutional client services division, which contains the firm’s trading operations, posted net revenues of $3.57 billion in the quarter, up 17 percent from a year earlier.
Goldman’s trading performance can be fickle, driven by whether the market was volatile that quarter and whether the right sort of securities saw the right sort of movement. Like its competitor Morgan Stanley, which will report results Wednesday, Goldman has been looking to diversify its businesses, moving in recent years into consumer lending and consumer banking.
Goldman’s investment banking business also had a solid quarter, posting net revenues of $2.05 billion, which is up 18 percent from a year earlier. The firm saw both higher underwriting revenue, as well as revenue for advisory services.
The firm’s return on equity ratio, a closely watched performance gauge for banks like Goldman Sachs which measures how much money the bank earned with the money investors have lent it, was 12.8 percent in the quarter. Banks like Goldman try to keep that figure above 10 percent.
Company-wide net revenues were $9.4 billion in the quarter, also beating analysts’ expectations.
Goldman shares rose 0.6 percent to $232.60 in premarket trading.
Wait, before you go…If you're reading this, you probably already know that non-profit, independent journalism is under threat worldwide. Independent news sites are overshadowed by larger heavily funded mainstream media that inundate us with hype and noise that barely scratch the surface. We believe that our readers deserve to know the full story. Truthdig writers bravely dig beneath the headlines to give you thought-provoking, investigative reporting and analysis that tells you what’s really happening and who’s rolling up their sleeves to do something about it.
Like you, we believe a well-informed public that doesn’t have blind faith in the status quo can help change the world. Your contribution of as little as $5 monthly or $35 annually will make you a groundbreaking member and lays the foundation of our work.
Support Truthdig
TD Column
Don’t bet on the disqualification of Donald Trump.
Opinion
Two decades of ongoing U.S. warfare had fueled the presumption that using deadly force is justified when all else fails.
Column
70 years after the CIA-assisted overthrow of Mohammad Mosaddegh, Trump's coup attempt is making its way through the courts.
Politics
The former President's criminal indictments and the GOP's direction on foreign policy are set to take centerstage.
Politics
Much like Richard Nixon, Donald Trump's lawyers have managed to step directly into their own legal woes while defending their client.
TD Column
After the latest charges out of Georgia, Bill Blum runs down the biggest takeaways and implications of Donald Trump's multiple indictments.
There are currently no responses to this article.
Be the first to respond.