Goldman Sachs traders were able to take advantage of volatile markets last quarter, mitigating profit declines and highlighting investment banking giants in various earnings reports of the country’s largest financial firm. Goldman also said he has increased his dividend by 25 percent.
Overall, Goldman’s profits, which reported its second-quarter results on Monday, fell by nearly 50% from a year ago to just under $ 3 billion. However, analysts expected Goldman’s earnings to shrink by as much as 60% from the same quarter last year, when the company’s profits surged, boosted by a recovery from the pandemic.
Goldman shares rose 3%.
Still, Goldman executives said banks were cautious for the rest of the year. They said hiring was slow and banks were “aggressively reviewing” share buybacks. Citigroup and JPMorgan Chase announced last week that they would suspend repurchases.
“There is no doubt that the market is becoming more difficult,” Goldman CEO David Solomon said in a phone call with analysts. Inflation is “deeply rooted” in the economy, he said, and rising prices are a major concern of the other CEOs he recently discussed. “The environment is uncertain, it’s very uncertain,” he said.
That’s not necessarily a bad thing, as Goldman’s higher-than-expected profits were also due to volatility. Long-known and sometimes criticized for trader dexterity, Wall Street powerhouses have outperformed their rival banks in second-quarter earnings from buying and selling bonds, currencies and commodities. Did. ..
Goldman’s closest rival, Morgan Stanley, reported a 49% increase in revenue from the same business over the same period. Citigroup, the only other bank to exceed its second-quarter expectations, saw a 31% increase in fixed income trading income.
Nonetheless, Goldman’s results, like those of other major banks this quarter, reflect inflationary damage, volatile economic conditions, sluggish closings, acquisitions, venture capital investments, Equity and bond market offerings are declining. Revenues from Goldman’s investment banking division fell 41% year-over-year in the second quarter. The company said the transaction backlog declined quarterly, but did not say anything.
In addition, Goldman, which has increased its presence in retail banking and lending, has secured $ 667 million due to potential credit losses.
