Goldman Sachs beats after record quarter in investment management

Lloyd Blankfein
Goldman Sachs Group chairman and CEO Lloyd Blankfein. Bryan Bedder/Getty Images for The New York Times

Goldman Sachs beat Wall Street estimates in the second quarter.

The US bank delivered earnings per share of $US3.95, ahead of $US3.43 EPS expected.

Here’s what you need to know:

  • The bank reported net revenues of $US7.89 billion, ahead of the $US7.5 billion that was expected.
  • The bank had its third best ever quarter for debt underwriting revenues, with $US721 million in fees.
  • Equities had its best quarter in two years, with $US1.89 billion in revenues, up 13% from the first quarter.
  • Fixed Income, Currency and Commodities Client Execution had a weak quarter, with revenues of $US1.16 billion 40% lower than the second quarter of 2016. The bank put that down to “significantly lower net revenues in interest rate products, commodities, credit products and currencies, partially offset by higher net revenues in mortgages.”
  • Investment management had record quarterly management and other fees of $US1.28 billion. Assets under supervision increased to a record $US1.41 trillion.

“A mixed operating environment persisted into the second quarter as conditions continued to support underwriting and M&A, while constraining certain market-making activity,” Lloyd Blankfein, chairman and chief executive, said in a statement. “Against that backdrop, we produced revenue growth and improved profitability for the first half of 2017, reflecting both the diversity and strength of our global businesses.”

Goldman Sachs’ results followed a generally strong showing from peers JPMorgan, Wells Fargo, and Citigroup last week. Each of the big banks beat estimates, with JPMorgan hauling in record earnings from its commercial banking and asset and wealth management units. Earlier on Tuesday, Bank of America Merrill Lynch bested Wall Street estimates, with record quarters in global banking and wealth management.

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