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Goldman Sachs quarterly net falls by 21pc to US$2.2b

Business | Apr 15, 2019 20:52
<p>Goldman Sachs said its first quarter earnings fell by 21 percent from a year earlier, hurt by a slowdown in trading.&nbsp;<br /><br />The investment bank earned a profit of US$2.25 billion, or US$5.71 a share, down from a profit of US$2.83 billion, or US$6.95 a share, in the same period a year earlier. The results did beat analysts&#39; expectations, however. The average estimate of six analysts surveyed by Zacks Investment Research was for earnings of US$4.74 per share..&nbsp;<br /><br />Goldman&#39;s profits were primarily hurt by their trading desks. Once a place of record profitability for the bank, Goldman&#39;s trading desks have struggled under lighter trading combined with periods of extreme volatility that are hard to navigate.&nbsp;<br />Net revenues in Goldman&#39;s fixed income, currency and commodities division was US$1.84 billion, down by 11 percent&nbsp;from a year ago. Stock trading was even worse, reporting net revenues of US$1.77 billion, down 24 percent.&nbsp;<br />David Solomon, Goldman&#39;s chairman and chief executive officer, described the quarter as a &quot;muted start to the year,&#39;&#39; in a written statement.&nbsp;<br />Other parts of Goldman&#39;s businesses struggled as well. The bank reported a 12 percent&nbsp;decline in net revenues in its investment management businesses, and a 14 percent&nbsp;decline in net revenues in its investing and lending business.&nbsp;<br />Goldman&#39;s return on tangible equity, a measurement that describes how well a bank is performing with underlying assets, was 11.7 percent. Banks like Goldman and its competitor Morgan Stanley aim for a return on equity above 10 percent.&nbsp;<br />Firmwide Goldman said it had net revenues of US$8.81 billion, down by 13 percent&nbsp;from last year, below analysts&#39; estimates, according to Zachs. -AP</p><p>&nbsp;</p>

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April 2019